Bayelsa govt: We won’t retrench workforce amid dwindling revenue

Governor Douye Diri
Governor Douye Diri of Bayelsa State

The Bayelsa state government has assured civil servants in the state that it had no plans to downsize the workforce, amidst dwindling revenue.

The government said on Thursday that although it was contending with an unwieldy wage bill, it would seek alternative sources of revenue to shore up its finances.

The Commissioner for Finance, Mr Maxwell Ebibai, gave the assurance at the transparency briefing for the months of January and February 2021, in Yenagoa, the state capital.

Ebibai said the state government received N6.8 billion for February 2021, as net receipts from the Federation Account, after first-line deductions, as against the huge wage bill and other recurrent expenditures of N7.358 billion.

He noted that the cost of running government had become highly challenging, as the state was contending with dwindling federal revenues, coupled with low internally generated revenue.

The commissioner said: “The state government is not considering rightsizing or downsizing the workforce. Cost-cutting is not always the first solution in solving our problems. The first approach is to look for additional income.

“If you consider our salary figures, the cost of running this government is a big challenge.

“But if you look at the extraordinary figures and capital projects’ expenditure, you would notice that our government is focused and we are ensuring that such extraordinary funds are dedicated to capital projects,” he said.

Presenting the income and expenditure figures for January, Ebibai said the state received N2.2 billion as statutory allocation, derivation was N5.5 billion, value-added tax N1.4 billion, exchange rate gain of N81.9 million and foreign exchange equalisation N158 million. This brought the gross receipts from the federation account to N9.4 billion.

He disclosed that N1.9 billion was the total deductions from the Federal Allocation Accounts Committee (FAAC), out of which the state spent N47.7 million on foreign loans.

It also restructured N5.4 billion refund of overpayment of revised 13 per cent derivation indices by N183.3 million and payment of N940 million to oil-producing states, as a refund of the N11.2 billion, among other items.

The commissioner also stated that funds from other receipts, included Internally Generated Revenue of N890 million, refund of excess crude N9.1 billion, and funds from other sources N1 billion, amounting to a gross revenue of N19.1 billion.

He explained that out of the N19 billion, the government spent N1.2 billion as bank loans and guarantees, civil servants salary N4 billion, salary arrears N310 million, political appointees salary N325 million, gratuities N150 million, grants to tertiary institutions N849 million, minimum wage arrears N50 million, among other components.

According to him, total payments came up to N7.358 billion, leaving a balance of N11.8 billion.

He said recurrent and capital expenditure gulped N18.7 billion, leaving the state with a deficit of N6.9 billion, which was financed from the N17 billion balance brought forward from the month of December 2020, adding that the state had a balance of N10 billion, as at the end of January 2021.

For the month of February, Ebibai noted that total receipts from the Federation Account stood at N8.8 billion, comprising N2.4 billion as statutory allocation, derivation N4.5 billion and value-added tax N1.8 billion.

The commissioner also said that the state’s total deductions amounted to N1.94 billion, consisting of foreign loans N35.9 million, commercial agricultural credit scheme N95 million, refund of N11.2 billion to oil-producing states N940 million, and restructured commercial loans of N741 million.

He noted that the state realised N951 million in Internally Generated Revenue, for the month of February, N20 billion refund from the excess crude account, leaving the state with a net revenue of N27.8 billion.

On deductions, the commissioner stated that the state’s total deductions amounted to N1.94 billion, consisting of foreign loans of N35.9 million, commercial agricultural credit scheme N95 million, refund of N11.2 billion to oil-producing states N940 million and restructured commercial loans of N741 million.

As for Gross outflows, he disclosed that this included bank loans and guarantees N1 billion, civil servants’ salaries N3.99 billion, political appointees N307 million, gratuity N200 million and grants to tertiary institutions N848 million, leaving a balance of N20.920 billion.

He added that total expenditures stood at N6.9 billion, while government spent N4.1 billion on recurrent payments and N20 billion for capital expenditures.

Ebibai further explained that government had an outstanding balance of N10 billion from January, but had a deficit of N3.2 billion in February.

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