Zero allocation: Payment of salaries’ll be tough, C’River govt warns

Cross River governor Ben Ayade

The Cross River state government has warned its workers that payment of salary could be a bit tough due to the resolve of the Nigeria National Petroleum Corporation (NNPC) not to make remittance to the Federation Account Allocation Committee (FAAC) for May due to the burden of subsidy payment.

Christian Ita, Senior Special Assistant (SSA) and Chief Press Secretary (CPS) to Gov Ben Ayade, stated this, Tuesday, in an interview with Blueprint in Calabar.

“This is not the best of time for us as a country. The NNPC not remitting to FAAC translates to the fact that there could be zero allocation for some states like Cross River. There are three main sources of revenue into FAAC, which are the Customs, Federal Inland Revenue Service (FIRS) and NNPC.

“However, the NNPC accounts for about 60 percent of the total revenue that acrues to government. With zero allocation, the challenge will be on how to graple with the cost of governance, including payment of salaries and overhead cost.

“Let us not pretend about it, it is going to be tough. Incidentally, our industries are not yet at the productive stage to cushion effect of zero allocation. Our industries and the airlines are not yet in the position to do that,” he stated.

When asked on why the state Internally Generated Revenue (IGR) was not utilised to rescue the state from the financial logjam, Mr Ita said IGR in Cross River cannot take care of the cost of governance, adding, “as you know, certain categories of people were exempted from paying taxes and some levies.

“There are so many things that government spends money on. Effect of any zero allocation projection could be cushioned only when our industries are fully functional.

“But let me say again, it could be tough paying salary; it is going to be a bumpy ride but all hope is not lost. Our governor, who is very passionate about workers welfare, will come out with a package, a remedy. He could fill that void with what he always referred to as intellectual money. Somehow, we have to depend on Ayade magic.”

The NNPC had said it planned to deduct N111.96 bn from April 2021 oil and gas proceeds due to the Federation account on Mày for payment of petroleum subsidy.

Related content you may like

Be the first to comment