29 April 2013, ABUJA — THE Federal Government has ordered the retrenchment of no fewer than 20,000 workers of the Power Holding Company of Nigeria, PHCN, ahead of takeover by successful bidders of its assets.
Vanguard gathered that the Bureau for Public Enterprises, BPE, issued the directive to the Chief Executive Officers, CEOs, of the 18 successor companies to PHCN at a meeting in Abuja, to compile names and drastically reduce the 50,000 strong workforce before the new investors take over.
It was gathered that new investors demanded that the workforce must be pruned before government hands off.
Labour warns on danger of action
Though it is not clear how government arrived at this figure, however, General Secretary of the National Union of Electricity Employees, NUEE, Mr Joe Ajaero, who confirmed the directive to massively retrench the workforce, said it was obvious that the Federal Government had decided to truncate the implementation of the collective agreement reached with the unions.
Already, organised labour had kicked against the move and warned the government against such action even as the agreement reached between both parties in December 2012 on the terminal benefits of workers had not been implemented.
The Senior Staff Association of Electricity and Allied Companies, SSAEAC, has petitioned the government through the Federal Ministry of Labour to explain the dangers and futility of government action when agreement on terminal benefits had not been honoured by the government.
On its part, NUEE directed members to shut down the power sector once any worker is issued a retrenchment letter without a financial back up in line with the December 2012 agreement.
NUEE, in a statement by Ajaero, rejected the planned retrenchment of workers without honouring the agreement the government entered into with the workers.
According to NUEE, “our attention has been drawn to the nocturnal meetings being held between Federal Government and all chief executive officers in Power Holding Company of Nigeria, PHCN, where a mandate to retrench workers in the power sector has been handed down to them. It is rather unfortunate and provoking that the Federal Government is hatching such obnoxious idea when agreement reached with the unions on payment of severance benefit is yet to be implemented.
“Information reaching us reveals that arrangement to close down PHCN’s Corporate Headquarters has been put in place. While people are still working, government plans to kill their management.
“It was equally gathered that the Federal Government has concluded plans not to pay pension or transfer money to the Pension Fund Administrators, PFAs, all in the name of driving workers to their early graves. We are worried that the government could be privatizing without cash backing, as information at our disposal suggests that about N43 billion is available out of the over N400 billion agreed with the unions.
“At the moment, agreement on certain indices to be used in calculating entitlements like life expectancy which the Federal Government put at 14 years is yet to be reconciled.
“By this posture, it is obvious that the Federal Government has decided to truncate the implementation of collective agreement reached with the unions. Nigerians should, therefore, hold government responsible for any reaction this action may generate.
“While there is still opportunity for the Federal Government to follow due process, we wish to state unequivocally that PHCN workers will legitimately resist every attempt to shave their hair in their absence. Should the Federal Government make good its threat to retrench workers in the sector when labour issues have not been settled, all members are advised to stop work, while those monies paid into their accounts should be seen as free money. The hour has come for you to defend your rights.”
Govt set to pay off workers —Igali
Meanwhile, the Federal Government has said it is now set to pay off the staff of PHCN. The Permanent Secretary, Federal Ministry of Power, Ambassador Godknows Igali disclosed this, weekend.
Igali told journalists in Abuja that the fund for the payment of the workers’ severance package was ready and that in a matter of weeks, they would be paid as part of the process of the takeover of the sector by private investors.
His words: ”What we have done so far is to try to ensure that the entitlement of these people and their severance package is well calculated from the point of their engagement to the point where the government is bringing the private people to take over.
“We have agreed on virtually everything. Government is preparing towards the formal takeover by the private sector. We expect the process to be seamless. So far, there is no major problem; the fund required to pay the people is available.”
The Permanent Secretary expressed satisfaction at the resolution of the issues surrounding the disengagement with the PHCN staff as well as casual workers and assured that the Federal Government was working to ensure that they were all happily disengaged.
According to him, the new owners would certainly re-engage many of the workers as it would be practically impossible to operate without the old staff. He said the private sector operators would be made to adhere to the nation’s labour laws.
His words: “The people that are working in these power plants are Nigerians, and when the private people take over, they are not going to bring workers from Jupiter, Mercury or China; most of their workers would remain Nigerians.
“The only difference is that they have been government workers up till now and as the government finishes with them, they will transfer their services to private operators who are driving the sector now. But the private sector will still follow the Labour law of this country.
“So, it is not a situation of whether there is going to be mass exodus of people out of the sector. Most of these workers have been very competent; they have been serving the country very well with commitment. And you cannot just replace those who have been on the job for many years.”
Training and retraining of workers
For those who would not be re-employed by the new owners and those who may choose to go into private business, Igali said: “Government also has a very robust programme to train and retrain the workers of most of these companies. Retraining them is at two levels: first is to retrain people in such a way that they can fit into a new nature of the sector. Before it was public service but now, we have private people taking over.
“So we are retraining them so that those who will continue working on contract basis will fit into the system properly. The second training is directed at those who would opt for private life. A lot of people may want to go into consultancy; like I said, the private people coming in cannot go out of the country to import thousands upon thousands of workers to take over our electricity sector. They will still need these same people.
“Government from the highest political authority has assured people of their commitment to ensure that all parties are satisfied with the way the issues are resolved.”
He added that the power reform transaction signing summit presided over by President Goodluck Jonathan, last Monday, was an eloquent demonstration of highest commitment by the government to ensure a successful conclusion of the power transaction.
The Perm Sec said $600 million (about N94 billion) was realised from the 25 per cent initial payments by the investors in the power sector and that they were equally determined to make the transactions successful with some even ready to make 100 per cent payment of their bid prices ahead of the 90-day stipulated payment period.
He said: “Some are ready to pay 100 per cent but 25 per cent was what was required at this stage and the total amount from the information we have from BPE is about $600m.”
Igali said power generation had risen to over 4,500 and that the Federal government’s target of 9-10,000 at the end of the year was still intact.
He claimed that some major cities of the nation now enjoy about 16 hours of electricity daily.
*Emma Ujah & Victor Ahiuma-Young, Vanguard