NITEL crippled by mounting debt

Nigeria’s  House of Representative Committee on Communications yesterday recommended the immediate disengagement of the entire 3,389 staff of the nation’s moribund telecoms operator, Nigeria Telecommunications Limited (NITEL), and its mobile subsidiary, M-Tel.

It also suggested the re-engagement of 455 transition staff from the 3389 staff so as to reduce the monthly wage bill to N115.5 million from the current N695 million. The re-engaged staff will remain until the handover to a core investor, while the existing security arrangements will also be maintained to secure the assets of the companies.

The House Committee made the recommendations while meeting with the top management of the Bureau of Public Enterprises (BPE) led by the Director-General, Ms Bolanle Onagoruwa over the lingering controversy surrounding settlements to the ex-staff of the communication’s outfit. The (BPE) said the communications outfit is currently weighed down by over N208 billion in debts being claimed by its creditors.

A crisis recently erupted between workers in the Office of the Accountant-General of the Federation and protesting ex-staff of the nation’s first communication’s outfit who were agitating over non-settlement of the entitlements. The protests began shortly after President Goodluck Jonathan approved the payment of the outstanding staff entitlements of N33.4 billion due to the ex-staff of NITEL and M-tel. The payments are to be effected in two installments in March and May, 2011, will commence next week.

The BPE Director-General said the verification and payment of all NITEL/M-tel staff and pensioners, except the casual staff, was carried out in 14 designated centres across the country between December 6 and 21, 2010.

Ms Onagoruwa, in a release by the BPE Spokesman Chukwuma Nwoko, said the sum of N54.4billion was sourced to settle outstanding staff liabilities which include salary arrears, entitlements to current disengaging NITEL/M-tel staff, allowances payable following court judgment in respect of the staff disengaged by Transcorp in 2006, pensioners and casual workers of the two telecoms outfits.

National Council on Privatisation (NCP) had at its meeting on June 11, 2010 reactivated the Presidential Task Force on NITEL/M-tel Labour Restructuring (Taskforce) headed by the Minister of Labour and Productivity to address the issue of outstanding salaries and allowances owed to Nitel/M-tel staff and to determine the number of staff to be disengaged to reduce the wage liabilities of government since the enterprises are not operating.

The Director-General added that owing to the poor record keeping of the pre-and-during Transcorp management of NITEL/M-tel, it was impossible to establish the actual debts of NITEL/M-tel.

She said in order to attract reasonable bids, the National Council on Privatization (NCP) approved to sell the enterprise net of all debts: “The entire debts of NITEL/Mtel were assumed by government and would be warehoused for subsequent settlement from the proceeds realised from the sale,” she said.

By Angela Meadon