The Real Reason Why Nigerian States are Bankrupt and Can’t Pay Workers

According to Prof. Charles Soludo, most Nigerian states are bankrupt and can’t afford to pay their workers because they’ve signed away their future statutory allocations to contractors whom they owe, Vanguard says.As a result, payment to contractors and other debt instruments are deducted at source and have become first line charge on their lean resources.

He said after such deductions from allocation to the states, they are left with little or nothing to operate with. As a result, most of the states are not able to perform their statutory obligations. Instead of telling the people the simple truth, they keep complaining of lack of funds.

Also, the internally generated revenues of these states are also not enough to meet their obligations so they owe workers several months of unpaid salaries.

Most of these states go into further indebtedness through heavy borrowing and undertaking projects they have no financial capacity to carry, he added.


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