LASU reacts to allegation of non-remittance of staff salary deductions to cooperative societies

Success Damian:

Lagos State University Management has reacted to claims of non-remittance of staff salary deductions to cooperative societies by the institution.

In a press statement by Ademola Adekoya, Coordinator, Centre for Information, Press and Public Relations, LASU, the university is worried that a matter built on the understanding and agreement of concerned stakeholders has unfortunately found its way into the media space as an issue.

He said prior to the nationwide lockdown in March this year in response to the coronavirus pandemic, the Lagos State University under the current administration had never defaulted in the monthly remittance of staff salary deductions to the cooperatives, ditto every other financial obligations to all its subsidiaries, adding that the University Management also pay salaries latest every 25th day of every month; that has never failed, till date.

Reacting further he said “The remittance of staff salary deductions to Cooperatives however became a challenge starting from April this year as a result of the significant drop in the University's income caused by the Covid-19 lockdown. The finances of the University, like that of many other organizations, states and nations, was severely hit when all income-generating activities stopped due to the lockdown; we were in a situation where income (subvention from state government and IGR), was low, and yet, obligations must be met, the most important of all being staff salaries.” 

Giving details of the university’s income and expenditure as it relates to salaries, the statement said “The University receives about Four Hundred and Fifty Million naira  (#450,000,000.00) monthly in subvention from the Lagos State Government and pays in the range of Five Hundred and Fifty Million Naira (#550,000,000.00) as salaries to its staff every month. This leaves the University with a deficit of about One Hundred million naira (N100,000,000,00) every month, which it augments from its Internally Generated Revenue (IGR) to meet up with regular payment of salaries .

“In April this year, the monthly subvention from the state government was cut from Four Hundred and Fifty Million Naira (N450,000,000,00) to Two Hundred and Ninety Two Million, Five Hundred Thousand Naira (#292,500,000.00) leading to a shortfall of One Fifty Seven Million, Five Hundred Thousand Naira (#157,500,000.00) coupled with the regular augmentation of One Hundred Million Naira (#100,000,000.00) which the university must cough out from its IGR monthly to pay salaries. The IGR was however, by this time, not available anymore owing to the total shut down of the University. By implication, in spite of this financial challenge, the University had to look for Two Hundred and Fifty Seven Million, Five Hundred Thousand Naira (#257,500,000.00) to meet up with the payment of staff salaries in April, 2020,” the statement said. 

The statement reads further “Recall that the State Government during the lockdown had promised to pay all workers in Lagos State their salaries despite the global economic downturn, and so even when it was almost financially impossible for the University to pay full component of its staff salaries like their counterparts in the state. Part of the very limited options available to the University however was to pay the component of staff salaries to banks while the staff salary deductions to the cooperatives was to be remitted when the university's finances (IGR) fully improves.”

He said that the University Management invited all the Cooperative Societies with Staff Unions to explain in detail and share with them the situation of the University's finances and how the Management intends to meet the challenge, saying that the majority of the stakeholders showed understanding with the Management on the position that the situation was not peculiar to LASU and as such, should be handled and resolved as proposed by the management. “It is with this understanding that the management continues to augment monthly staff salaries pending when the situation normalizes,” he said.

He decried the situation whereby mischief makers have been quick to escalate the issue in order to discredit the University’s Management for some selfish motives.

He said despite the dip in the Internally Generated Revenue (IGR) of the University occasioned by the suspension of some academic programmes, the main source of the IGR, the University has continued to meet up with the performance of its financial obligations: payment of staff salaries latest 25th of every month, promotions of deserving staff carried out despite its financial implications, and other ancillary expenses are also carried out by the University in spite of its lean resources.