The Truth behind Sanwo Olu’s proposed cancellation of pension payments to Tinubu, Fashola and Ambode

Sanwoolu must tell Lagosians the truth behind the proposed cancellation of former Governors’ pensions instead of presenting it like an altruistic action ….

The facts:

1. Ex-Governors are being paid humongous pension packages, after their tenors, by a lot of States.
2. The Pension Reform Act of 2004 changed Nigerian Pension system from Defined Benefits to Defined Contributions.
3. This means that private and public sector workers can only be paid pensions from the funds they contributed while in active pensionable work.
4. The salaries of Governors and their deputies are not subjected to pension deductions, their own pensions can only be fixed by the Revenue Mobilization, Allocation and Fiscal Commission (RMAFC).
5. Lagos State is one of the States using Tax payers money to make this illegal pension payment to non-contributing ex-governors/deputies, a case of robbing Peter to pay Paul.
6. When Lagos State wanted to issue Bonds to raise N100billion from the Capital Market in Jan 2020, the Nigeria Pension Commission disqualified the Bond from accessing pension monies in custody of the PFAs.
7. Lagos Government had to sign an undertaking to correct the illegal pension payment provisions in its pension law before the disqualification was lifted.
8. Lagos was then able to borrow N100billion in Jan 2020 to spend on projects yet to be properly accounted for.
9. Justice Oluremi Oguntoyinbo of the Federal High Court, in a suit filed by SERAP in 2017, in judgement last year December ordered that the Attorney General of the federation to challenge the legality of the pension payments to ex-governors and their deputies.
10. The National Industrial Court in January 2020, also declared as null and void, payment of pension and gratuity to former governors and their deputies.

This is the position of the law as of now, in the absence of any Appeal Court order setting it aside.

11. Lagos State intends to borrow additional huge sums of money from the Capital Market again, but it must cancel the illegal payments to governors/deputies by revoking Ex Governors Pension Law in order for PENCOM to qualify it’s new borrowing for PFAs’ investments.
12. Sanwoolu’s decision to cancel the ex- Governors pension law is not altruistic and should not be applauded. The decision to cancel the illegal pension is by compulsion and not by choice.

13.Civil society and other stakeholders must monitor the present Lagos State Government to ensure it does not continue to pay these monies to the ex-Governors through the back door through nebulous tax Consultancy (Alpha-Beta) contracts ,inflated and fictitious contract awards.

Concerned Lagosians

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