Waltzing through Landmines


The federal government and Power Holding Company of Nigeria workers’ unions are still negotiating to find a solution to possible hurdles that can delay the handing over of privatised distribution companies to new investors

By Maureen Chigbo  |  May 13, 2013 @ 01:00 GMT

THE federal government is still trying to find its way out of the stumbling block workers of the Power Holding Company of Nigeria, PHCN, pose to the privatisation of the company. As at last week, the government, the Bureau of Public Enterprises, BPE, and union officials were still locked in negotiations, which is hoped will end in two weeks. By that time, all the thorny issues raised by the workers which revolved around their gratuity and severance packages are expected to be resolved so that the handing over of the privatised distribution companies, DISCOs to investors who have successful bid for them and completed the remaining 75 payment for the companies can proceed without any hitch. The bidders of the 17 DISCOs have paid the initial 25 percent of the bid offer. They have less than six months to make full payment.


Before that time comes, the workers’ union have insisted it will not allow any handover of the companies to the investors until all the severance packages are fully paid. Joe Ajaero, general secretary, National Union of Electricity Employees, had said recently that the directive to union members to prevent the take-over of successor companies was not an empty threat.

Since then, the federal government has engaged workers in negotiation and trying not to send the wrong message to investors.  For instance, Chinedu Nebo, minister of power, said May 1, that the federal government would use the proceeds from the privatisation of the Power Holding Company to offset the severance package of the power sector disengaged workers. He said that the proceeds would be used to bridge the gap between the N384 billion approved for the payment of workers’ severance package and N45 billion allocated for the same purpose in this year’s budget.

Realnews gathered that the government will net more than $3 billion from the whole privatisation of the DISCOs and that the money was more than enough to pay the workers. An  official of the Bureau for Public Enterprises said that it had always been the practice of the BPE to use the proceeds from privatisation of companies to pay off staff severance packages. “The proceeds are more than enough to make the payments. We are going to pay them before the handover. That’s what we have always told them. It’s not new. That’s what we have always done,” Joseph Anichebe, BPE spokesperson, told Realnews on phone.


Negotiation between the government and the workers union has been a long drawn process since 2000. It got so bad when Barth Nnaji was the minister of power that the union organised a prayer vigil raining fire and brimstone on the minister. They also embarked on an industrial action by blocking staff from entering the premises of the PHCN headquarters.

The ongoing negotiation between the government and union workers heated up when it was reported that the federal government said that private investors are to determine the fate of workers of the Power Holding Company of Nigeria and its 17 successor companies. The BPE had reportedly issued a letter to the chief executives of the power companies to submit names of 20,000 workers to be retrenched before the takeover of the firms by the successful private sector investors that won the bids for their sale. Denying the allegation, Anichebe said the agency had never been responsible for the sacking of workers in any entity that it had privatised. Anichebe added that the delay in paying the benefits accruing to the workers was as a result of their failure to submit their bank account numbers and retirement savings account numbers. Nebo also said neither the federal ministry of Power nor the BPE issued the directive that 20,000 workers should be retrenched. Kande Daniel, spokesperson for the minister on media, described as unfortunate the allegation of nocturnal meetings between the federal government and chief executive officers  of PHCN successor companies.

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