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Osun saves N1.4bn from pension arrears payment

/, News Room/Osun saves N1.4bn from pension arrears payment
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Osun saves N1.4bn from pension arrears payment

The Osun State Government has said it has saved N1.4bn from the payment of the 142 per cent pension arrears due to retirees.

In a statement on Friday, the Commissioner for Finance, Economic Planning and Budget, Mr. Wale Bolorunduro, said the feat was achieved through the use of biometric database created by the administration of Governor Rauf Aregbesola.

According to the statement, the total pension arrears left unpaid by the previous administration of Prince Olagunsoye Oyinlola was N4bn.

The commissioner said Aregbesola accepted to pay the debt in October last year out of his concerns for the welfare of the senior citizens of the state.

The first instalment payment of 15 per cent or N599m, according to him, resulted into a savings of N213m.

He added that the same biometric database system created by Aregbesola would be used to pay the balance, which would result in additional savings of N1.2bn.

According to the statement, the total savings of N1.4bn would have been paid to un-identified retirees if the manual system had been used.

Bolorunduro congratulated the recipients of the 142 per cent pension arrears and promised that the administration would continue to cater for the welfare of Osun citizens and residents.

He explained that the use of the biometric database was part of the expenditure re-engineering required to free the state’s cash flow for capital project development.

“Once the payment of the first instalment is concluded, we shall commence the subsequent payments. The system was developed through a partnership with a very reputable indigenous and proven technology company, Chams Plc  as a public-private partnership, and instead of making initial project fund available, the partnership is such that the state and the operator share the savings over a period,” the commissioner added.

According to him, this risk sharing mechanism is a global acceptable standard employed to improve public finance.

(Punch – March 25, 2013 )