Osun Modulated Salary: Saved Workers From Retrenchment and Helped to Manage Economic Crisis

What is new? What has changed? Why it matters?

Osun modulated salary save jobs of civil servants in Osun. It was new because 72% of civil servants between level 1-7 got their full salary. It matters because from level 8 and above took much of government revenue to pay civil servants salary. What has changed is that Osun state government now developed skills to pay workers salary in a period of economic crisis and managed little resources. By July 2018, full salary of workers was paid.

With the gale of retrenchment sweeping through the private sector, public workers were not smiling either, as they were variously owed months of salary, while others were apprehensive of the likelihood of wage cuts. Many states were facing a hard time meeting salary obligations since the slide in oil prices, a development that led to about 60 per cent cut in allocations from the Federation Account.

Osun embarked on modulated salary of 28 percent of its workforce to prevent mass retrenchment of its workers. Modulated salary saved Osun workers from mass retrenchment, a policy put together by former Governor Aregbesola as a kind of rescue package. Aregbesola used modulated salary to show his commitment to his contract and the future of Osun workers. He used modulated salary to save jobs in Osun and help the workers instead of reducing the workforce. The Osun government used modulated salary to save jobs and pay wages of workers that would have be sacked. The government used modulated salary to get a settlement and a guarantee of wages of the workforce in Osun. Modulated salary was the policy instrument that saved the workers’ jobs in Osun. Modulated salary was not half salary.

The report by some groups in Osun is a clear attempt to malign Governor Rauf Aregbesola and paint the state government as deliberately paying Half Salary. It is only a section of workers on grade level 13 and above that receives painfully 50 per cent of their salaries based on agreement between the government and the labour unions. Outside that category of workers on grade level 13 and above, no other receives half of his or her salaries and the workers in this category are just about 20 per cent of the state’s workforce. Workers on levels 8-12 receive 75 percent of their salaries while officers on levels 7 and below receive their full pay.

Only 28 per cent of the state’s total workforce received modulated salary, and that the remaining 72 per cent of the workers have been earning their full salary and are not being owed any outstanding salaries.  28 per cent of Osun civil servants have endured modulated salaries. These are the 20 per cent who earn 75 per cent of their monthly pay and the eight per cent who collect 50 per cent of their salary. “The remaining 72 per cent, as you all know, have been earning their full pay and are not being owed any outstanding salaries, irrespective of the spin being given to this by our traducers. Even at that, we must thank everyone for the sacrifice you have all made in other areas.

28 percent of civil servants in Osun State in the employment of the state government under the leadership of Rauf Aregbesola began to receive payment of full salary for the month of July 2018. Government workers and their dependents in the State of Osun constitutes only 3 per cent of the entire population adding that governance should not be reduced to paying salaries. The percentage of the civil servants is 1 percent and their dependants are 2 per cent of the population of the State. So, if you also consider the 97 percent of the society, Aregbesola administration has succeeded amazingly.”

Within the 8 years of the government of Rauf Aregbesola, a whopping N200 billion was spent on payments of salaries, allowances and pensions while a relatively paltry sum of N60billion naira went into infrastructure, or what we call capital projects. This translates to 77 per cent to 23 per cent respectively. The reverse should have been the case. No nation develops this way and it is so sad. So, when people falsely declare that Osun government is building infrastructures to the detriment of workers’ welfare, it is laughable.

The modulated salary structure adopted by the State of Osun became a child of necessity in July 2015. It is a survival strategy for a State that had been long neglected in infrastructure development but recently took a deliberate decision to rapidly develop the State. Well, soon the reality of the bad economic situation and some not well thought through policies crept in on everyone in the second half of 2015. Prior to this period however, the administration of Ogbeni Rauf Aregbesola had introduced and paid the 13th month bonus to workers for the first time in the history of the State as a gesture to motivate the public service workers and make them partners in the development of the State.

Let us examine the facts:

1. *GL 1-7* constitute *72%* of the workforce.

2. These *72%* are paid *100%* of their salaries and have been paid up till November 2017. _*Not a dime is owed this group which are the most vulnerable in any society.*_

3. *GL 8-12* constitute *20%* of the workforce.

4. These *20%* are paid *75%* of their salaries and have b een paid up till November 2017.

5. *GL 13* and above constitute *8%* of the workforce.

It is important to highlight that *28% of the workforce account for more than 50% of the wagebill.* This is however understandable when you plot that against the Pareto principle.

Modulated salary structure became a painful child of necessity in *July 2015.* Up until then full salaries were paid to all categories of workers, leave bonuses were paid promptly and pensions were never delayed. Now, lets look at these figures which were captured in nearest absolute decimal numbers:

Prior to November 2010 when Ogbeni Rauf became Governor, the *average IGR was less than N400m.

The implication of this is that wage bill alone in the period under review constitutes *85.85% of Gross Total Revenue.*

The massive investment in infrastructure is a strategy towards jump starting the economy of the state. There is no doubt that the workers of the State have made huge sacrifice towards the huge transformation going on across the State. History will be kind to them. It’s been tough for the administration of Ogbeni Rauf. He was able to make omelette without breaking an egg with the support of workers. It is important that this support is sustained in the interest of the State..

Inwalomhe Donald

writes from Osogbo inwalomhe.donald@yahoo.com