© 2019 - International Centre for Investigative Reporting
INVESTIGATION: Strike, miracle jobs, salary cuts… how slush funds tore Akanu Ibiam polytechnic apart
Attempts to cover up years of graft in Akanu Ibiam Federal Polytechnic, Unwana in Afikpo, Ebonyi State have failed, resulting in a strike, extortion of students and a harrowing learning environment.
The Akanu Ibiam Federal Polytechnic, Unwana, has been enmeshed in financial distress since 2016, following the implementation of Treasury Single Account (TSA). It started with the Government Integrated Financial Management Information System (GIFMIS), a component of the TSA that strives to make government budgeting and revenue collection more transparent and efficient.
Before the new financial measures, Akanu Ibiam Polytechnic – just like other federal institutions – used to receive a monetary allocation of personnel costs into its bank accounts. This gave the management of the polytechnic the leeway to inflate personnel costs and enjoy a huge leftover of money after payment of salaries. The slush funds were spent at the discretion of the institution’s managers.
The GIFMIS was the game changer in the graft that was sustained for years. Now, the polytechnic still prepares its payroll but the money does not come into the institution’s accounts anymore. It uploads the payroll into the GIFMIS platform with which the Central Bank of Nigeria (CBN) disburses the money directly to the individual accounts of polytechnic staff.
‘MIRACULOUS’ JOB OFFERS WITHOUT INTERVIEWS
Shortly before the implementation of GIFMIS, Akanu Ibiam Polytechnic embarked on a secret recruitment of staff to shore up the huge personnel costs allocation it had been receiving over the years. The ICIR gathered that between 400 and 520 workers were secretly recruited.
The jobs were not advertised and those who got the jobs were never interviewed. In fact, the new employees received their letters of employment and confirmation of appointment the same day, an indication that the positions were backdated to cover up “ghost workers”. In civil service, confirmation of appointment comes after two years of the offer of employment.
Many of those who got the jobs are relatives of senior staff of the polytechnic. One of the new employees told the ICIR that she was watching a movie when she received a phone call from an uncle.
“It was a miracle,” she says. “I got a job without interview, without even applying for it.”
Inya Ibiam, Deputy Rector of Administration, admitted that the secret employment was carried out but insisted that the school did not do any wrong thing.
“We have been investigated by the Federal Character Commission and given a clean slate of operation,” Ibiam told the ICIR. “Yes, there was employment but not up to the number you stated. The school has not defaulted in its employment no matter how they look at it.”
A senior management staff lamented that the story of the secret employment would now be public, adding that the slot was shared and the beneficiaries included those from the Federal Character Commission and the staff currently campaigning to remove the Rector, Ogbonnia Ibe-Enwo, who has been recommended for reappointment by the Governing Council of the polytechnic.
He said the two wives of Marcellus Eze, the then Chairman of Academic Staff Union of Polytechnic (ASUP) in the school, were among the beneficiaries of the job bonanza. Regrettably, he said, Eze is now the arrowhead of those castigating the Rector and working against his reappointment for a second term.
He said the school was not the only institution involved in the so-called “padding of budget”; every other federal tertiary institution was involved too.
While the secret recruitment shielded Akanu Ibiam Polytechnic from being exposed on its huge number of ghost workers, the cessation of the slush funds has created an unprecedented crisis in the institution.
DEDUCTIONS FROM STAFF SALARIES
With GIFMIS in full swing by 2016, the staff of the Akanu Abiam began to notice unusual deductions from their salaries. A pay slip of a senior lecturer seen by the ICIR showed he received N273, 250 as net salary in May 2016 but it had reduced to N238, 338 by June.
The management of the institution had explained to the staff that there was a substantial drop in personnel costs allocated to the institution by the Federal Government and the polytechnic could not settle the allowances of the staff as previously done.
A check by the ICIR actually showed that the monthly allocation to the polytechnic for personnel costs dipped from 261 million to 241 million in 2016. The full allocation, however, was restored in 2017. With the restoration of full allocation, the staff began to receive their peculiar academic allowance which was suspended in 2016. The allowance is 7.2 percent of their basic salary for teaching staff and 5.2 percent for non-academic staff.
Despite the restoration of full personnel costs allocation and the resumption of payment of the peculiar allowance, members of the staff were still noticing unusual deductions from their salaries. Simply put, their salaries were still below what they were receiving before June 2016. The management had publicly explained to the staff that the deductions were caused by a shortfall in the monetary allocation to the polytechnic.
Following the agitation by the staff, the Rector had summoned leaders of the three staff unions in the school to disclose the real reason for the unusual deductions – it had realised that it was overpaying the staff when the institution still had access to slush funds made from ghost workers or inflated personnel costs. For this reason, the management has begun to deduct contributory pension from the gross earnings of the staff in June 2016 which accounted for the decrease in their net salaries.
PENSION DEDUCTIONS EXPLAINED
The 2004 Pension Reform Act mandated employees and employers to contribute to the employees’ retirement savings. In this regard, 7.5 percent of employees’ consolidated salary will be deducted for the contributory pension scheme. The employer equally contributes 7.5 percent towards the scheme.
When the Federal Government realised that many of the institutions were not remitting their employees’ pension contributions to the employees’ retirement savings accounts maintained by their pension administrators, it decided to start deducting the employees’ contributions at the source. The Federal Government subsequently centralised employer and employees’ contributions and deducted at source by the Budget Office of the Federation. Personnel costs are released to federal ministries, departments and agencies net of the deductions.
In a December 2012 circular to departments and agencies of the Federal Government, Ngozi Okonjo-Iweala, former Minister of Finance, explained that the deduction at source was necessary to ensure timely remittance to the National Pension Commission for onward transmission to the appropriate staff pension manager.
She said the amount deducted at source should only appear on the employee’s monthly pay slips as a proof of their contributions and to show that they did not receive less than the government approved salary.
According to Okonjo-Iweala, the reflection or showing the amount of the staff contribution to the scheme in their pay slips does not in any way constitute double deductions as was being speculated then in some government’s institutions.
Despite the fact that the Federal Government started deducting pension contribution at source as far back as 2007, Akanu Ibiam Polytechnic continued to pay its staff 100 percent, instead of 92.5 percent of their gross earnings as the government had already deducted 7.5 percent at the source for a pension. In essence, the polytechnic was paying its staff 107.5 percent. This was possible because even when the government had deducted pension contributions from the personnel emolument, the polytechnic was still able to pay the staff 100 percent because of the huge leftover from inflated personnel costs. The surplus payment continued until 2016 when GIFMIS became the mode of payroll.
LECTURERS EMBARK ON CONTROVERSIAL STRIKE
To convince the leaders of the staff unions that the new pension deduction being reflected on the staff’s pay slips was not double deductions, the management of Akanu Ibiam Polytechnic offered to sponsor them on a trip to investigate it.The leaders of the two non-teaching staff unions accepted the money from the management to embark on the investigation while the leaders of teaching staff declined management’s sponsorship for the trip.
Innocent Agha, Chairman of Senior Staff Association of Nigeria Polytechnic, Unwana chapter, told the ICIR that his union did not join the strike because there was no justification for it. He said when they investigated the pension deduction by visiting relevant agencies in Abuja, they realised that the explanation given by the management was true.
“If you bring what was taken at source, it will give you your salary,” Agha said. “When you multiply it by 12, it gives you the per annum. If you go to your letter of employment or letter of promotion, you will see that what is stated there is reflecting what is being given to you now.”
ASUP, however, submitted a report that the pension deduction amounted to double deductions. ASUP also accused the leaders of other unions of accepting a bribe from the management to keep quiet about the deduction.
Amidst this controversy, Marcellus Eze, ASUP Chairman, was suspended by the National Executive Council (NEC), following a petition that was allegedly written by the management of Akanu Ibiam Polytechnic. Eze had been putting the members’ dues into his personal account and tampering with the money without remitting to the national body. With Eze’s suspension, his vice, Carl Nworu, became Acting Chairman.
At the ASUP’s congress on March 1, 2018 in Unwana, a motion to embark on strike was moved since the management had failed to restore their full pay prior to June 2016 after an ultimatum had elapsed. The motion was supported by 189 members against 51, while six votes were voided. Instead of declaring the strike, Nworu pleaded with the members to give him until March 8 to obtain approval to embark on strike from NEC.
Members resisted his plea and the session became rowdy. Nworu eventually left the venue without declaring the strike. In the absence of the chairman, the secretary took over and made the declaration.
The intention of the members was to begin the strike before the students start their semester examination on March 9, which they believed would hit the management the hardest.
“As long as the union is concerned, we are not on strike,” Nworu told the ICIR before the strike was called off. He said since the NEC did not approve the strike and he did not declare it, the strike was invalid.
In an interview: Eze, the suspended Chairman; Osibe Jonathan, former Chairman; and Madubuike Chibuike, the current Publicity Secretary of the union told the ICIR that they did not do anything wrong in embarking on the strike.
“As at the time that I was a member of NEC, there was a blanket approval that any chapter that has problems with its management and can sustain the fight, they can go ahead with strike but notify NEC,” Eze explained. He said they would have gone on strike over the issue of deduction in 2017 when he was still the Chairman but he pleaded with the members to shelve the strike.
However, a resolution of the 90th meeting of NEC expressed disappointment at the level of impunity in the Akanu Ibiam Polytechnic chapter with respect to disobedience to the union’s constitution.
A copy of the letter dated March 9 and addressed to the Chairman of ASUP in the school, the NEC declined any form of approval for the already declared strike as due process was not followed in taking the action.
NEC also condemned the level of disrespect to constituted authority in the union, including the office of the Chairman of the chapter resolving to address the issue administratively with the culpable officers.
A copy of ASUP constitution obtained by the ICIR clearly stated that chapters must obtain approval from NEC before embarking on a strike.
To resolve the impasse over pension deduction claims, a joint committee of ASUP and Governing Council of the polytechnic went on fact-finding mission to other institutions. A report by the committee that the pension deduction did not amount to double deductions led to the suspension of the strike on April 19 – seven weeks after it was declared.
STUDENTS THE VICTIMS OF IMPUNITY
As the GIFMIS blocked the slush funds of Akanu Ibiam Polytechnic, students are now being extorted.
Realising that the polytechnic, which was established in 1979 and effectively took off in 1981, did not have an active alumni association, Grace Ibe-Enwo, wife of the Rector, installed herself as President of the association in 2016. She was first employed as administrative staff in the school but she worked her way to become a senior lecturer. Along with another senior staff of the polytechnic who is the Secretary of the alumni association, they imposed outrageous levies on all the students.
Since 2016, all the students in the polytechnic, including freshmen in ND and HND, have been paying N5,000 annually for alumni levies, making it the first tertiary institution in the country to charge first-year students alumni levies.
The imposition of the alumni levies on all the students is an ingenious means to make money in a school with a student population of just over 5,000. The Rector’s wife actually took a cue from the management that charges students N5,000 in addition to their school fees for entrepreneurship courses that they must take every session.
Meanwhile, the effect of GIFMIS is not only evident in the unjustified fees imposed on the students but also in the depreciating quality of learning and services.
Unwana hardly has electricity from the national grid; the polytechnic depends heavily on the generator. The state of financial distress of the polytechnic means that purchasing diesel for the generator has become a struggle. The diesel-powered generator is often switched on from 10 am to 2 pm. With this short period of power supply, students are not able to make use of laboratories for their practice and assignment.
The Akanu Ibiam Polytechnic has also slashed the duration of its part-time programme from three years to two years in an effort to attract candidates who do not meet the entry requirements for regular programme into the ND and HND programmes. The part-time programme is now run as regular but the only difference is that the students on part-time pay higher fees.
The polytechnic has concluded arrangements to make all examinations in the school computer-based, in order to reduce the cost of printing question papers. But the teaching staff has argued that the measures will make all examination questions objective, which are ineffective for testing students’ knowledge in a technical school.
MORE TROUBLE FOR THE POLYTECHNIC
While slush funds have sustained the polytechnic for years, it has come to its wit end. In January, the management announced to the staff that it could no longer pay the peculiar allowance because its internally generated revenue is very poor.
Now that the academic staff have finally agreed that the pension deduction is not double deductions, the management of the institution will still have to convince them to forgo their peculiar academic allowance, which is 7.2 percent of their basic salaries.
“Our internally generated revenue is zero,” Inya Ibiam, the Deputy Rector of Administration, told the ICIR. He said the only source of internally generated revenue is the part-time programme but due to the location of the school, it does not attract enough part-time students. Part-time students pay N68,000 per session while regular students pay 37, 000 depending on the faculty.
“What we have is service fees, not school fees,” Ibiam argued. For example, he explains that what makes up some of the so-called school fees are N1,,500 for an identity card, N4,500 for examination scripts, N5,000 for medical, and N3,000 for ICT.
The termination of the slush funds did not only affect the staff and students of the Akanu Ibiam Federal Polytechnic but also the outsourced security and cleaning services in the institution. Cleaners and guards are victims, too, their monthly pay slashed from N25,000 to N10,000.