The Nigerian government has outlined its plans to sack federal civil servants to reduce the size of its workforce.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, disclosed this while taking questions at the Public Presentation and Breakdown of Highlights of the 2022 Appropriation Act on Wednesday in Abuja.
According to the minister, there will be exit packages for the workers which would be disbursed immediately they are sacked.
She added that the retrenchment of workers was a necessary step in stemming the huge amount spent on recurrent expenditure annually by the Nigerian government.
She said, “There is a special committee, led by the SGF, that is working on the review of agencies, with a view to collapsing them partly using the Oransanye Report.
“At the end of it, what we want to do is to reduce the size of government and also to reduce the size of personnel cost and part of it will be designing the exit packages that are realistic.
“We are revenue challenged. So, for everything we do, we can’t put an exit package if you are not willing to cash it immediately. So, when you are asking people to exit by choice, you must be able to give them that package as they are exiting.
“There are so many things that are happening. These are not easy decisions to make because they affect people and families. So, you have to make sure that whatever we commit to we are actually going to deliver on it.”
Meanwhile, Nigeria is broke and has been borrowing to fund its budgets and relying on loans to pay salaries.
For example, Minister of Labour and Employment, Chris Ngige, while doctors were on strike over poor allowance, had in September 2021 confirmed that the Nigerian government under President Muhammadu Buhari borrowed funds from international sources to pay salaries of workers because of a shortfall in the country’s revenue.
Ngige had said the government took borrowed funds from foreign institutions like the World Bank to offset some recurrent expenditures.
Also, Ahmed, had in April 2021 admitted that Nigeria’s economy was facing a difficult time, saying borrowing was inevitable.
She had said, “We have very low revenues, we have very high expenditures. What we have done so far is just to provide some stability to make sure salaries are paid, pensions are received every month; that we send funds to the judiciary and the legislature; that we meet our debt service obligations.
“That’s what we are doing. It also means we have had to borrow more than we had planned before the COVID-19 started because we need to still continue to invest in infrastructure using our national budget. We borrowed to invest in key projects such as roads, rail, airports, seaports and several other investments that are required in health and in education and upgrading the social standards and quality of life of our people and Nigeria is not unique as several countries of the world went into recession.
“Almost every other country has had to borrow more than it planned. It means we expanded our deficit very fast in 2020. 2021 is a year that we see as the year of recovery.
“So, FAAC reduces and whenever FAAC reduces, it is a very difficult situation and in the past one year, we have tried to fall back on some specific accounts that are meant to be saved; savings that when you have such a situation, you fall back on the resources and augment.
“So, we take funds based on Mr President’s approval either from Excess Crude or Stabilisation Account or in some cases, President approved for us to take funds from LNG (Liquefied Natural Gas) dividends. In the month of March, we had a shortfall of FAAC that was about N50 billion; we didn’t have enough accrued in any of those accounts other than some N8.5 billion that we took from the exchange rate differential account so we added that and we ended up with the FAAC of N605 billion.”
Nigeria’s dwindling finances had also come under intense pressure as the Muhammadu Buhari-led government has been amassing foreign loans.