AN ASSESSMENT OF SALARIES REFORM ACT AND ITS IMPLEMENTAION IN NIGERIAN PUBLIC SECTOR

ABSTRACT

        This study examines critically assessment of salaries reform act and its implementation in Nigerian public sector, using ministry of works Rivers state as a case study. The urgent need of reform necessitated fact due to the fact that public sector organization at both the federal, state and local government levels have woefully failed to meet their salaries liabilities thereby groaning under the heavy burden of paying the retirement benefits of retirees. The scourge of “ghost salariesers, has further aggravated the lingering salaries crisis. Strict regulation of the activities of salaries fund Administrators and Nation salaries commission is to be established and charge with the responsibility for the regulation, supervision and effective administration of all salaries matters in Nigeria. The researcher used primary and secondary methods of data collection to gather the needed data. The data obtained through questionnaires were presented in tables and analyzed using the simple percentage. The findings have also shown that factors which militate against successful salaries reform act and its implementation I Nigeria public sector: knowledge gap and general misconceptions, widening the coverage in the informed and private sector, many of the public sectors are not yet to buy the idea, securing system widebuy-inand initial reluctance form employees for register with PFAs and capacity building in the new salaries industry. The study recommends that workers should invest in fixed income. The Nigeria government should intensify effort to ensure financial safety net for older persons in general; through social salaries of foxed stipends for individual above the age of 65 years.

CHAPTER ONE

• INTRODUCTION

Salaries as a form of social security against old-aged poverty and other uncertainties have great interest virtually everywhere in the world, both in developed and developing countries, in recent times. Salaries programs especially those that are publicly financed and administered, have become an issue of concern to economists, policy makers and the general public for effective implementation. This is not only because such programs are central to the well-being of the salariesers and the elderly, but also, the majority of salaries programs are not actuarially balanced (that is, they are not financially stable), and as such, they are run at deficits, thus making the present values of their future liabilities to be enormous.

The present civilian administration extended its form programs to the administration of salariess in the public service. The reform holds an overall objective of reorganizing the salaries scheme and the various institutions charged with the administration of salaries in Nigeria. The reform overhauled the entire machinery of the salaries system through a holistic redefinition of its essence, as a mechanism of participatory savings for the proverbial rainy day.

Salaries scheme is a transfer programs that serves as a channel for redistributing income to the elderly or retirees, after a stipulated number of service years. A salaries is usually a regular payment made by the government or private companies or organizations to their retirees, as a form of social security against old-aged risks and uncertainties. In addition, salaries scheme/programme are also used to promote a saving culture among current employees, and this stimulates saving.

Nigerian salariesers are suffering badly from the stings of the problem of public salaries scheme, which was largely governed by salaries decree No.102 of 1979. It has features persistent problems in recent times, especially in civilian regime. Some of the problems are:

1. The dependency of salaries scheme and the erratic budgetary allocation to the federal government.
2. The untimely release of salaries scheme.

• The untimely release of salaries funds which affects the payment of salaries benefit and other retirement benefits

1. A huge accumulation of salaries liabilities, among several others.

The present salaries reform, repeated the previous salaries Act No.102(cap 346) of 1979. It replaced it with salaries reform Act 2004 , as amended in 2014 which gives legal backing to the reform specifically by sec,11(5) of salaries reform Act 2004,as amended in 2014 employers are required to  deduct from source the monthly contributions of their employees and remit same together with their position, directly to the account designed by salaries fund administration(PFA). Remittance of work must be made within seven (7) working days from the date of payment of salary of employees. Failure to comply with the requirement, constitute an offence under sec.11 (7) and 89 of the salaries reform Act 2004 as amended 2014.

Finally, a greater importance has been given to salaries and gratuity by employers because of the belief that if employees future needs are guaranteed, their fears ameliorated and properly taken care of, they will be more motivated to contribute positively to organizations output. Similarly various government organizations as well as labor union have emphasized the need for sound, good and workable salaries scheme.

• STSATEMENT OF THE PROBLEM

Several years before salaries reform, most salaries scheme in the public sector has been under funded, owing to in adequate budgetary allocations. Budget releases which seldom came on scheme where far short of due benefits. This situation has resulted to unprecedented and unsustainable outstanding salaries deficits estimated at over N2trillion before the commencement of PRA in 2004.

First, comes the layoffs then pay cuts finally a delay in the payment of benefits due to poor salaries policy formulation and implementation, incorrect record keeping and inadequate accountability of public funds. The non-implementation of budgeted income to salariesers delay in payment and denial of salaries’s accrued to salariesers leading to salariesers protesting over nonpayment of salaries and non-compliance with ethics of public financial management.

In Nigeria, to collect retirement benefit became problematic and a source of hardship to retirees. The Nigerian salaries system had been plagued by week and restrictive investment practices, under funding and mis-management in addition to poor corporate governance. These problems led to the institutionalization of salaries reform in 2004 to make salaries payment less burdensome and more efficient.

It is on this background that this study sought to investigate how the ministry of works Rivers states addressees salaries reforms act vis-à-vis its implementation.

1.2OBJECTIVE OF THE STUDY

1. To examine the impact of salaries reform and implementation on the welfare of retirees in the ministry of works Rivers State.
2. To identify the benefits/importance of salaries reform act on salariesers of ministry of works Rivers State.

• To access the strategies for efficient salaries scheme in Nigeria with particular reference to ministry of works Porthacourt.

1. .To examines challenges that are affecting effective salaries reform and implementation in the ministry.
2. .T o recommend ways of implementing salaries reform scheme in ministry of works Rivers State.

1.3 RESEARCH QUESTIONS

1. What are the impacts of salaries reform and its implementation on the welfare of retirees in ministry of works Rivers State.?
2. What are the benefits of salaries reform act on salariesers of the ministry of works Rivers State?

• What are the strategies for efficient salaries scheme in Nigeria with particular reference to ministry of works Rivers State.?

1. What are the challenges that are   affecting effective salaries reform and implementation?
2. How can salaries scheme be implemented in the ministry of works, Rivers State?

1.4 RESEARCH HYPOTESIS

HO: salaries reform and implantation has no impact on the welfare of retirees in the ministry of works Rivers State.

H1: salaries reform and implementation has impact on the welfare of retirees in ministry of works Rivers State.

H0: salaries reform act has no benefit on retirees in the ministry of work. Rivers State.

H1: salaries reform has benefit on retirees in the ministry of works Rivers State.

H0: salaries scheme has no effective strategies for efficient salaries system in Nigeria with particular reference to ministry of works Rivers State.

H1: salaries scheme has effective strategies for efficient salaries system in Nigeria with particular reference to ministry of works Rivers State.

H0: salaries reform and implementation has no challenge that is affecting the system.

H1: salaries reform and implementation has challenges that are affecting the system.

1.5 SIGNIFICANCE OF THE STUDY:

In this research, the significance of the study is to bring together the various ways and facts as regards to the subject matter, Assessment of salaries reform Act and its implementation in Nigerian public sec tor

1. It is believed that the outcome of this research work will be of interest to Government, individuals and to the corporate organization.
2. The research work will provide them with vital information regarding challenges facing effective salaries act and its implementation in Nigeria public sector. The organization can utilize its study to make amendments or control a number of lapses that may be affecting the effectiveness of salaries reform act and its implementation in Nigerian public sector, in terms of untimely payment, lack of efficient implementation and lack of efficient record keeping for salariesers.
3. It will also highlight the benefits of salaries reform act and its implementation in Nigerian public sector to increase the status of the public sectors.
4. This research work will also serve as a vital material to those who may want to carry out further research work in this regard.

1.6 SCOPE OF THE STUDY

THIS research focuses on Salaries reform Act and its implementation in Nigerian public sector which was limited to ministry of works Rivers State.

1.7 LI MITATION OF THE STUDY

This research was constrained by some factors like lack of fund which delayed the realization of the study, other limitations are:

1. Lack of co-operation: many of the respondents are usually aggressive to relay the issues that borders co-operation among the respondents border.
2. Material factor: shortage of relevant material for literature review posed a great difficulty.
3. Inability to retrieve all questioners forms for good representative used for anticipation sample.
4. The study equally limited to the information gathered from primary and secondary sources.

1.8 DEFINITION OF TERMS:

1. GRATUITY: This is a lump sum of money given to an employee on retirement from the public service. It could as well be in kindness or other monetary benefits.
2. IMPLEMENTAION: This is the realization of an application, or execution of a plan, idea, model, design, specification, standard or policy. It is also the process of putting something into operation.
3. LUMP SUM: This is a single payment for a number of separate items, money paid in full rather than in several smaller amounts.
4. SALARIES: This is a periodic payment made by the employer to the retired employees, in consideration for his/her past service in the organization. It is the 30% of terminal salary, paid on monthly basis. It is a fixed sum paid regularly to a person, typically given retirement from service.
5. POVERTY: this is the general scarcity or death, or the state of one who lacks a certain amount of material possession or money .it is also seen as the quantity or state of being poor.
6. RETIREE: This is someone who has retired from active working life.
7. SCHEME: This is systematic plan of future action.

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