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FG to clear N75billion pension arrears through bond issue

Posted by By Chijama Ogbu and Oluyinka Akintunde on 2006/07/10 | Views: 827 |

FG to clear N75billion pension arrears through bond issue


The Federal Government has concluded plans to pay off outstanding N75billion arrears of pensions to workers by floating a bond.....

The Federal Government has concluded plans to pay off outstanding N75billion arrears of pensions to workers by floating a bond.

The Minister of Finance, Mrs. Nenadi Usman, who announced this in Lagos on Friday, said that the government had concluded an arrangement with a bank to finance the payment of the arrears.

Usman said, "We have been able to successfully put together a plan in which we float the bond. The bank will pick up the bond and bring the cash. And it is not going to be at any premium to the pensioners at all.

"Everybody is going to get his money in cash and in full. And it will now be between us and the bank that lent us the money. And the bank has given a number of years within which we are to pay and all that. Those are the things I will disclose at the appropriate time. But it will not be a long time from now."

She said that the government would ensure that farmers received loans at concessionary rates to encourage them to buy high-yielding seedlings and modern implements.

She also said that she had worked out an arrangement with the Minister of Agriculture, Alhaji Adamu Bello, for the purchase of farm produce whenever prices were low.

Usman, who presented what was like her agenda as the Minister of Finance, said that her focus would be to raise the living standard of the people.

She identified creation of jobs and enhancement of the disposable income of Nigerians as her priority areas.

She said, "I will make sure that we affect the lives of the masses positively through our actions.The first thing I thought of doing is to pay the local contractors that we have been owing all these years.

"We have constantly put it in the budget but it had not exactly worked out. We have got to pay these people back their money.

"These people took loans from the banks and they executed the jobs and they have not been paid. Right now, what some of them will receive will be used to liquidate their loans."

She added that the government would begin the payment of contractors whose monies were less than N100million from Monday (today).

A senior government official had told our correspondents on Friday that over N450billion was needed to clear the verified debts to local contractors.

The total domestic debts are estimated at over N1.3trillion.

It was also learnt that the government would pay the contractors at the Banquet Hall of the Presidential Villa, Abuja.

The source, however, was not forthcoming on the source of financing the debts, as the government had budgeted N25billion in 2006 to pay contractors.

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