Commercial Law

Tinubu, Fashola to lose jumbo pension

Lagos State Governor, Babajide Sanwo-Olu on Tuesday announced his intention to repeal the Public Office Holder (Payment of Pension Law 2007), which provides for payment of pension and other entitlements to former Governors and their Deputies.

Sanwo-Olu revealed this while presenting the 2021 budget to the Lagos State House of Assembly. He said the abolition of pension for former governors and deputies will reduce the cost of governance.

He said, “Mr. Speaker and Honourable Members of the House, in light of keeping the costs of governance low and to signal selflessness in public service, we will be sending a draft executive bill to the House imminently for the repeal of the Public Office Holder (Payment of Pension Law 2007), which provides for payment of pension and other entitlements to former Governors and their Deputies.”

Sanwo-Olu first gave the hint five days ago when he advised governors to look for ways of cutting down on expenditure in other to provide more social needs of the people.

Speaking at the 22nd Annual Tax Conference of the Chartered Institute of Taxation of Nigeria (CITN) held at Eko Hotel, Victoria Island in Lagos, on November 5, 2020,Governor Sanwo-Olu stressed the need for better utilisation of tax payers’ money by public office holders to build the trust of the citizens, adding that State executives must work toward having a better reform process.

He said: “We need to look at our expenditure profile as Chief Executive of our state and ask ourselves, where can I cut the red tape; what can I do away with so as to increase the revenue of my state or even make available more money for my state.

“What I have done till date is that I have not purchased any single official vehicle for myself, for any of my personal staff or any of my family members from the government purse. If you see me have a convoy of 10 vehicles, these are all vehicles I was using during my campaigns.

A serving Commissioner in the state earlier  in the year had revealed to Gavel International that members of the State Executive Council have been using their private cars because, according to him, “the state is broke”. He said the governor had been using his financial expertise, goodwill and connections to raise funds for the few projects the state embarked on.

According to the information on the website of the Debt Management Office as of Wednesday, 26 states that have the pension laws for their ex-governors owe a total of N3,920,194,580,284.72 (about N4trillion), comprising N2,906,789,725,341.46 domestic debt and $3,311,780,571.71 (N1,013,404,854,943.26) foreign debts as of June 30, 2019.

Among the states, Lagos State, which owes N479bn domestic and $1.4bn foreign debts, and tops the two debtors’ lists, was the first state to introduce the pension law for former governors in the history of the country. It was signed into law by former governor Bola Tinubu at the twilight of his tenure in 2007. Since then other states have copied the law like wildfire, providing comfort for a few and depriving the people much needed funds for social and infrastructural projects.

According to the Public Office Holder (Payment of Pension) Law, former governors of the state, who completed two terms consecutively, are entitled to a house each in any location of their choice in Lagos and Abuja.

Also, a former governor is entitled to six new cars every three years, 100 per cent of the basic salary of the serving governor (N7.7m per annum), free health care for himself and members of his family as well as furniture allowance, which is 300 per cent of their annual basic salary (N23.3m).

This however is subject to review depending on current situations of the country.

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