Economy Special Report

VERY HOT: ABIA STATE FORMER FINANCE COMMISSIONER OPENS UP, GIVES REVEALING DETAILS OF STATE FUNDS

Afnews Editor

Dec 16, 2019

In this interview with former Abia State Commissioner for Finance, Mr. Obinna Oriaku, he gave details of the financial transactions during his 4 years as finance commissioner and also gave insight into the present dispensation. READ DETAIL

As the immediate past Commissioner for Finance, Abia State, what challenges did you encounter on assumption of office?

Well, on assumption of office on June 2nd, 2015, we had about four special advisers. I started as a Special Adviser Economic Affairs on secondment from First Bank and this means that I functioned as a staff of First Bank and they still paid my salaries for the four years.

I never got any salary from Abia State Government and my name was never on the payroll of Abia State Government.

There were a lot of challenges, first, we found out that the State was still processing payment of salaries manually, there was no centralized pay roll/data management scheme in place. There was no biometric capturing of civil servants, there was no idea of TSA, and there was no existing relationship between the State and any donor agency like World Bank etc.

Our overhead obligations were heavy and cutting down was the way to go, all these and more were too heavy for the young administration.

One of the things we deliberated on was whether to pay salaries with the old processes we met and that means manual payment through the MDA's. The process is such that cheques are issued based on the submission of the payroll officers which are most times fraudulent and manipulated by the collaborations of the payroll officers.

We devised a means which was highly resisted by the civil servants by developing a checklist which captures your name, Ministry, Agency and departments, date you joined service, current level, last promotion date, gross and net amount earned. We made sure that the director of administration, finance and Permanent Secretary jointly sign that the person is a bonafide staff of the Ministry.

With this, we started gathering the data of civil servants though we discovered they were not cooperating, this semi automation process was highly resisted.

This is because the manual process they were using helped a lot of them in defrauding the State.

We identified about few bureaus that had about 20 to 30 staffs, most of them gave reason that they do not know what excel format means, however we engaged the bureaus under the SSG and taught them how to prepare the excel format and went ahead to announce that we have started paying salaries for June 2015.

Our MDA wage bill was One billion, five hundred million naira (#1.5b) as at june 2015 when we came on board with automation we saved about Six hundred million naira (N600m for the State, today the MDA salary have gone down to about 800m without prejudice to those that retired and those newly employed.

It's instructive to note that some departments were paying cash to their staff in brown envelopes
We had to deal with the issue of fraudulent employment of workers without waiver, a small committee was set to review those employed without waiver over 800 illegal workers were discovered.

When the salary committee was invited by EFCC office in Port Harcourt, payroll officers inserted the 61 names into the State payroll and two months later, they were discovered and removed which cost the State about Fifteen Million naira (#15m)

Where things are done well, the pay roll officers should have been sanctioned and made to bear the punishment of how we lost Fifteen Million naira (#15m) to non-existing civil servants, so these are the issues we met and the processes that led to where we are today.

That is my legacy that we were able to get the database of the civil servants, have them under one centralized payroll system, Did biometric capturing of entire civil servants, the subsequent administration can only improve on what we have done as it affects salary processing but currently the ministry of finance is still running on my template.

On pension, we introduced automation of pension payment instead of cash payment that was abused, it is on record that when we came in, pensioners were being unfairly treated as they were made to travel from their local Governments and villages to the Sub-treasuries and even end up going home empty handed because pensions couldn't get to them, even for as low as Five Thousand Naira and Two Thousand Naira (#5000, #2000) were being paid under the mango tree, they were at the mercy of those Sub-treasurers, civil servants lobby to be made sub-treasurers than Permanent Secretaries because they were pocketing about #7m monthly, building hostels and hotels in Umuahia and Aba. To curb the pension fraud we introduced the automation of pensioners by gathering their data because we are dealing with old people to confirm if they are still around or not, if they are not, we remove them and input the freshly retired.

We also had the issue of TSA. getting all our payments under one kettle, we succeeded in doing that but I cannot tell you it's 100% but we did at least 70% of the implementation and this also saved the State a whole lot.

We also have programmes currently going on in the State and it was courtesy of the window we opened and the narrative we changed in our relationship between Abia State, World Bank and other multilateral agencies.

Then the issue of over-bloated wage bill, we discovered that Abia till today pays the highest in the whole South-East, our Permanent Secretaries earn highest in the entire South east which is cascaded down to the least staff in the state.

In line with the Governor's directive of cutting down 50% of his emolument, we were able to cut down Seven hundred and Fifty thousand naira #75,000 from One Hundred and Fifty Thousand naira #150,000 which naturally should have been overhead in the Permanent Secretaries salary but they embedded it in the entire salary.

This cost cutting affected every other overhead expense as a committee made up of the then SSG, AG and myself we took a critical look at our overhead and decided to reduce the entire overhead including that of my office by reducing the cost of going to Abuja for FAAC from One million, six hundred thousand naira #1.6m to Five hundred thousand with the belief that we must practice what we preach but surprisingly the amount has been jacked up to 1.6m since I left office.

It is surprising to note that barely two days after the new exco was formed, the salary committee that worked very hard was disbanded as was announced on air.

But it is interesting to note that after one week, this same committee headed by Mrs Charity Ukonu the lady that was detained at Afara prison and her team is still and currently processing payment of Abia civil servants, but why the current commissioner for finance decided to keep it a secret is still a surprise to me.

During your time as Commissioner, salaries were coming late, sometimes into the first and second week of the following month but now, salaries come latest the 28th of the month. What was the problem?

Salaries were the major issues of the previous administration and even the current one. The picture they succeeded in painting was that Obinna Oriaku was not keen on paying salaries as it were.

As it affects salaries and pensions, I must state that the issue of salary payment is very fundamental and that is where I lost it with the civil servants and people who refuse to reason with it. If what we used in paying one civil servant in Abia is what is used in Enugu to pay for two months which does not add up. If you like bring Ngozi Okonjo Iweala to be the Commissioner for Finance, the issues are there and they will continue to be there until the fundamentals are addressed which was the area I focused on.

You cannot eat your cake and have it. You cannot have an over the bloated workforce, employ everybody in your village because your brother is the Governor.

You are earning far than what you should earn. I did an analysis of our total receipt in 45 months and outside the intervention of the Paris Refund, the State got about one hundred and fifty six billion naira (#156 billion) and about One Hundred Billion (#100 billion) was used for salaries, emoluments and pensions, the other Fifty Six Billion Naira (#56 billion) was used for overhead and capital projects, the implication is that Abia State exist just to pay salaries this has to change if the State is to move forward.

On why salaries are being paid early, during FAAC meeting in April 2019, the Commissioners Forum made a passionate appeal to the current Minister of Finance that we want the FAAC brought closer, before then our FAAC meeting date starts 24th -26th and if it falls on a weekend, that means the allocation is gotten either 30th because you will have to give a 2-3 days notice after FAAC meeting to get your allocation. That is why the average expectancy for FAAC allocation is between 27th -28th and after that, you can begin to talk about salaries.

After the demand by the Commissioners Forum, the FAAC meeting was brought back to the 19th of every month. The implication is that by the 22nd -23rd of every month, allocations have arrived and salaries are being paid.

That salaries are being paid today has no input from anybody except for the fundamental change in FAAC date from the federal government and the repayment of the Temporary Overdraft (TOD) under my watch as the commissioner for finance.

Most importantly, we were running on a temporary overdraft, this means that we usually go to the banks, ask for little augmentation to pay salaries and that system has been on for over three years.

That was why salaries were paid the first week of a new month because you must wait for them to do their end of the month for the CBN and other regulatory authorities to see that that account is in credit.

Abians should note that it had no human or technical intervention, it is only this thing that I have explained now done under my watch that is making salaries come early, go to the DMO and CBN sites and confirm when the FAAC holds.

Can you highlight those Reforms you brought on board as the Commissioner for Finance?

1) We discovered that we cannot be going round the problems of Abia State as they are fundamental from the military era. We resolved to attack them which we did.

One of the reforms we did is the Judiciary reform. I know that the white paper was about being implemented when I left.

The JUSUN salary issue, people ran to the judiciary, when you go there, we have more than 30 staff in one small magistrate court and even the customary courts and they do not seat more than once in a quarter and you are paying a humongous wage bill. An analysis of the judiciary will tell you that the entire judiciary constitutes over 40% of the entire wage bill so we felt that we need to attack it.

2) Civil Service Reform: I expect that the civil service reform should be concluded. That civil service reform is very critical to the survival of the state because today in Abia State, the budget is not being followed.

A situation where every year people are being promoted, the civil servants are excited about it but they forget that they are also going to wait for the repercussion, imagine every one leaves together at level 16, it will have an effect on the pension and it becomes difficult to pay, I'm sure their pension is hitting Five Hundred Million naira (500m) monthly and It beats me how these payments will be made regular with poor monthly allocation and I wonder which government will pass out such value with the meager allocation we are getting. So these are the reasons I made enemies because I said we must address these issues if we are going to tell ourselves the truth.

3) We also have the IGR reform which is still ongoing, we automated the processes, the autonomy was about being implemented but there are still some issues that need to be addressed, the workers in the board of internal revenue, those employed as a board cannot be sacked or moved, these are the issues that needs to be sorted out because the reforms demands that you run the board like a private-sector based organization where professionalism and performance is given prominence than where you come from or how long you have been in the organization, these are the reforms that are still ongoing, We need to find a mutual resolution of those workers employed by the board and fully implement the restructuring as being done by other States that have grown their IGR as fresh and highly motivated staff is what is needed.

4) Again we did that of parastatals, we set out committees that visited them, discussed with them and also get to know their problems and now the implementation is what I expect the government to follow up.
Also the Educational Institutions: schools, I remember that Professor Mkpa headed the one for the technical college, so the report should be out by now.

5) Local Government Reform, we engaged in that reform because we discovered that some people earn salaries in the local government at the state level and also earn as political appointees, with the automation we did, and linking with their BVN we were able to identify them and made it clear that their salaries can come from only one source while others can be called allowances, but these are the reforms that we did and substantial savings were also made at the local and state government levels because we realigned our salaries in line with what it should be.

This act also incurred enmity among friends and relations who feels that because you are there it is your turn to protect their own people and perpetuate the fraud and immorality that is going on in the system so that it how it affects the reforms we did.

The most important one which today I'm excited about is the disarticulation, this is one of the most exciting reforms I supervised, It's unfortunate that almost 20 years after the implementation of the Universal Basic Education law in 2004 Abia State is the only State that still had the Junior secondary school management under the State, This accounts for why we have challenges with teachers salary. Today we have successfully moved the management and supervision of JS1 to JS3 to ASUBEB which is under the local government and free the state to focus on the senior secondary school, today the State is better positioned to clear the arrears of secondary school teachers as the wage bill has drastically gone down this is one of our legacies and I am excited that after 20yrs we have solved that problem.

We made available #6b as state Government contributions towards clearing the arrears of outstanding UBEC counterpart funding obligations, today over 10b has gone into remodeling of our primary schools and with our recent success in implementation of disarticulation. our Junior Secondary schools (JS1-3) will now benefit from the UBEC intervention in schools.

6) Economic Reform and Provision of counterpart funding of Projects: On assumption of office there was no viable donor agencies projects on going in the State .This was basically due to the mismanagement of such funds by past officials of government we understood that we cannot solve our problems alone we focused on provision of funds to attract the federal government component.

These include provision of over Six Billion naira (N6b) as state government contribution. Today we have almost cleared arrears of our UBEC funds that were lying fallow at UBEC Abuja. We provided over One Billion (N1b) as counterpart fund for NEWMAP that attracted over Thirty Two Billion Naira (# 32B) to Abia State for the takeoff of the Port Harcourt road, Uratta Road, Ngwa road, Drainage and flood control management.

We also provided over Six Hundred Million (N600m) for the Ramp. Today we are among the few States in the south South and South East states involved in Ramp 2 worth of Sixty Million USD ($60m dollars), We also intervened in the world bank ARIN program worth over Twenty Million USD ($20m). FADAMA 2. We were among the few States that keyed into the Sftas program etc.

African development Bank. AFDB.

Our engagement with Adfb was reinvigorated even before assumption of office in 2015 through Mr. Emeka Ononiwu.

This intervention has literally been concluded as ADFB have already concluded the procurement process for the engineering design of some projects. This intervention which is on drainage, road and Sanitation is worth Three Hundred Million Dollars ($300m).

As the Commissioner for Finance I successfully defended the loan request before the House Committee of both the National Assembly and the Senate.

Note: This is outside their interest in the Enyimba Economic City Project
Procurement Reform. Under my watch we redefined government business by making sure that our procurement process is very transparent, this as expected did not go down well with few disgruntled people, however I am convinced that it is the only way to go and no regrets about it and this this saved the state a lot of money.

Some of the staff that worked directly under you then as Commissioner for finance, in the salaries and wages committee were accused of fraud, some were arraigned by the EFCC and taken to court, what do you know about those cases?

In as much as we are advised not to discuss matters that are Sub-judice, but it's instructive to note that some of them are in court on allegation of Six Hundred Thousand Naira (N600.000) to Two million Naira (N2m) but today that same team have also been redeployed to the salary committee and they are currently processing the salaries of civil servants in Abia state, Salaries are paid from a central poll so they sold this wrong notion to the people that the committee deducts their salaries and that word "deduct" connotes illegality and fraud, I'm sure that is why the House of Assembly was quick to see that committee as evil and because they did not sit down to ask the fundamentals of their roles and objectives.

The little display of shame didn't work so the matter is still before the court so I will not want to go further in that area.

Why were you not reappointed despite all the reforms you put in place, the services you rendered to the State, you did a whole lot of work so why were you not reappointed for the second time in office?

First, I thank God that I am in good health, I also thank the Governor for giving me the platform and for having such confidence in me, at a time I was the only commissioner remaining after others were dissolved so that man that did it then is still the same man in charge.

Our relationship is still robust and I still contribute from the background, we all must not be on board at the same time, and it is not all the time that you will be in charge, so even if it didn't come again, I'm happy to have found favour to work with him for four years, when others were at home for close to six months I and the then attorney general were the only people working so let's leave it as this is my own period of rest because every appointment is at the mercy of the Governor. We are still in good terms, when I explained the issue about Lloydant, some people came to understand that this was the only thing they could hold on to, they even went to the Bank to search if there is any incriminating thing they can hold onto but unfortunately they didn't see, I thank God for the type of person I am, I didn't try to compromise and I even challenged them and stood my ground that things must be done the right way.

When I came in I discovered that Lloydant, though already engaged by the state through the tertiary institutions had positive ideas, a good example is the IGR collections by those institutions prior to the coming of Lloydant, ABSU was collecting One Billion, Five Hundred Million Naira (N1.5 billion) but under Lloydant they were able to make Three Billion, Eight Hundred Million Naira (N3.8 billion), Abia Poly with a large number of students were only able to collect Six Hundred Million (N600 million) in 2015 but with a reduced student population in 2018 did over 1 billion Naira (1bn), school of health was only able to collect Twenty Five Million Naira (25 million) as of 2015 but between January to June under Lloydant they collected Two Hundred And Forty Million (240 million).

People were more worried about me and that is why I thank God that I'm alive today but all the same I bear no grudges against anyone and I am also contributing to the art of statecraft, we all must not be in office to contribute. I encourage everybody not to back off when faced with my type of challenge but keep contributing.

Did your constituents feel your presence while you were in government and what's their reaction to your non-inclusion in the present government

It was one of the biggest shocks for them especially when they knew that my ward came first in the Governorship election among the ten wards in Isiala Ngwa South. In fact, the second ward had a difference of almost 250 votes so for them they worked hard.

They believed that their brother was the face of the government and the Governor, they were totally demoralized but I quickly gathered and spoke to them. I encouraged them not to despair about what happened as it is natural in politics.

My constituents have fared well in the past four years. We have a market that closed for over 40 years, that market is back today courtesy of the Governor and that is why we are grateful to him.

Not every Commissioner could have done that, today we have a ring road that serves as a gateway to Port Harcourt and even Imo airport. Businesses are developing on that road and that is how you add value to the life of the people. Empowerment is not only when you share money, but the people on that road have also been empowered to the extent that they can bring out their vegetable and people travelling to Port Harcourt can stop and do their shopping.

The most important road we did is the one called Umuechalla road, the road was so bad that even a trailer could not pass through that road for years, but today, it is asphalted, linking up Isiala Ngwa South and North even though it is not finished yet. It is only Governor Ikpeazu that could have done that.

We got over two transformers within this period, through ASUBEB intervention we built two new school blocks in my area. Government presence was felt, and that is why I told them not to despair. The Governor knows why, so I am not worried, we can always move ahead but are we going to continue in the trajectory we are.

They say I'm arrogant but I only stand by what is right. We cannot continue to run the State like that, we must support the Governor to change the narrative. Every South East State is moving on. We cannot be dragged down by things that have transient value, money and influence when other States are moving ahead.

It is my wish that we keep the growth trajectory, we keep improving. I'm excited at what has been made with Made in Aba goods, Golden Guinea coming back and we also expect others to come back too.

Any regret serving the State?

Not at all, how many people had that opportunity to serve as Commissioner for Finance for four years and have the access and relationship with the Governor and still do? So, no regrets. I thank God he saw me through for four years
We give him the glory and we are committed towards the new Abia so we keep soldiering on until we get it right.

As I always say "if you want to be loved by everybody then go and sell ice cream".

Thank you

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VERY HOT: ABIA STATE FORMER FINANCE COMMISSIONER OPENS UP, GIVES REVEALING DETAILS OF STATE FUNDS

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