From inception, allegations of financial impropriety have been a reccurring decimal at the Nigeria Social Insurance Trust Fund (NSITF). The Federal Government last month inaugurated a new board. Will the new team be different from the predecessors, TOBA AGBOOLA reports.
On June 1, 2021, the Federal Government, through the Minister of Labour and Employment, Dr Chris Ngige, inaugurated the new management of the Nigerian Social Insurance Trust Fund (NSITF), with Dr Michael Akabogu, who has a doctorate in Financial Mathematics, as the Managing Director.
Earlier, the Senate had issued a warrant of arrest on the NSITF management for not honouring its invitation over what it described as financial malpractices of it management. The Senate claimed the agency had over 50 unanswered audit queries.
Will the new team be different from the predecessors? Will there be transparency and proper accountability in the new team? These and many questions are on the lips of those familiar with the Fund.
Empowered by the Employee Compensation Act of 2010, the NSITF collects contributions from public and private employers and pays compensation to workers for injuries or death at work. The fund was contributed by employers to purchase insurance package for their employees, and from which employers can also seek compensation for loss of man-hours.
But the NSITF has been in the news over misappropriation of funds. For instance, the Senate, on Tuesday, indicated that the management of the NSITF misappropriated about N84 billion within four years.
The Chairman, Senate Public Accounts Committee, Matthew Urhoghide, who made this known, described the agency as a cesspool of corruption.
“They depleted our resources, just a few human persons who are mindless,” he said, noting that the revelation came from 12 out of 50 queries investigated so far by the committee.
He said it was unfortunate that the management and board of NSITF colluded between 2012 and 2017 to carry out the alleged graft. “They are all guilty. They are implicated. They stole the place dry. The agency is most defiant and most notorious,” he said. One of the queries read: “Audit observed that the Fund had been implementing a salary structure that is not approved by the National Salaries, Income and Wages Commission. As a result, irregular payment of N38,219,919,530.32 by way of personnel cost was made to the staff of the Fund from 2012 to 2017. “Implementation of unapproved salary structure may result in wastage of public funds, as remuneration may be higher than the productivity level of staff. “The Managing Director is required to provide the approval of the National Salaries, Income and Wages Commission for the implementation of the Fund’s salaries structure.”
Another query reads: “Audit of the Fund’s bank statements for the period under review revealed that contributions received from the Federal Government in 2014, amounting to N 5,500,000,000 were diverted to a Zenith Bank account number 1013938003, instead of the Skye Bank account number 1790122304 into which other contributions were paid, without providing any authority or any form of explanation for such diversion.
“Audit further observed the following: The bank account was opened without the approval of the Accountant-General of the Federation, as no such approval was presented for audit. The new account was opened specifically for this purpose as seen in the bank statements where a first tranche of N2,750,000,000.00 was used in opening the account on August 29, 2014.”
From Ismail Agaka’s acting management of 2015 to Bayo Somefu, who took over in 2017, observers believe that the agency has underperformed in meeting the objectives for which it was set up for.
Speaking with The Nation on the expectation, the Director-General, Nigeria Employers’ Consultative Association (NECA), Mr Timothy Olawale, said the Fund with the new board was expected to deliver its mandate of providing compensation to employees who suffer injury at work.
“This is fundamental. Employers are making contribution towards this; it goes beyond this. It must be used to provide succour to the employees.
“Another aspect is the safe work intervention project. This is another contribution from the employers. It is to support both the employees and the employers of the saved working environment
“We expect that the new management will continue in this line. And, most importantly, prevention is better than cure. They should deliver their mandate this time,” Olawale said.
A labour activist, Emmanuel Anuke, said a close observation of the activities of the NSITF showed that its core mandate has been relegated to the background while issues of pecuniary interests had become the main preoccupation of those overseeing its affairs.
He said if there was going to be any meaningful change, the Federal Government and other public and private sector stakeholders need to review and overhaul the operations of the NSITF.
That, according to him, is the only way to make it more transparent and result-oriented.
“The constitution of a new board has not resolved the problem at the Fund. If anything, it has only just added a new layer of problems. Apart from incessant tussle for prominence among the Fund’s stakeholders, there seems to be no transparent accounting and procurement procedures in place. “There is also the issue of poor placement of priorities by the management of the fund with more attention given to the awards of contracts on frivolous projects than voting more money for employee compensation, medical treatment and other welfare packages,” he said.
It is against this background that Ngige during the inauguration told the new management, led by Akabogu, that he expectexd nothing other than a total re-birth of the Fund.
Taking cognizance of the incidence of mismanagement of funds that had bedeviled the operation of NSITF, Ngige implored Akabogu and his team to ensure a re-birth, saying: “I am confident that you can lead the charge of re-birth of the NSITF.This new management has one unique advantage, a defining shift, in having men and women who have been staff of this organisation rise to its topmost management positions. You know the problems of this organisation and I am confident that you can lead the charge of re-birth of the NSITF. This paradigm shift in structural composition must meet the huge expectations of positive shift in goal delivery.
”It is important for me to draw the attention of the new management to the financial hemorrhage the NSITF has passed through in the last few years and the imperative of a new direction as contained in the directive of the President. The NSITF must be revitalized and repositioned to fulfill its mandate in accordance with the establishing Act.
“The years of the locust are now over. You can’t afford to take us back to Egypt. The era where N5 billion vanished in one day is gone for good. The era of looting of N48 billion without a single voucher is far gone. This new management should not indulge in the sins of the past and must adhere to the statutory conditions of service and remuneration for Board members approved by the Minister as enshrined in the NSITF Act.
“Procurements must be done as contained in Procurement Act 2007 and Finance Act, Financial Regulation and the extant Government circulars, especially on Threshold of Procurement items. “Your performance will be measured every quarter and annually with the yearly reports and Audited Accounts to enable the Ministry do her own report to the President. Our measure as supervising Ministry is tied to your performance in terms of realisation of your mandate and vision.” While admonishing them, he said: “On your shoulders lies the burden of untying this organisation from the tethers of stagnation. We must live down the past and lead a rewarding change in the fortunes of the NSITF.”
It would be recalled that on July 1, 2020, President Muhammadu Buhari approved the suspension of the former Managing Director, three Executive Directors and nine other senior management officers of the NSITF from office, following established prima facie infractions on extant financial Regulations and Procurement Act, and other acts of gross misconduct. The President also approved the setting up of a Presidential Joint Board and Audit Investigation Panel to probe affected officers.
According to the minister, the investigation panel sat, completed its assignment, and made far reaching recommendations as well as steps for their implementation. He said the highpoint of the recommendations which President Buhari approved, included the removal from office of the former officers suspended last July and the structural changes in the management team.
Also sworn in were Mrs. Akinwale Caroline Temitope as the Executive Director, Finance and Investment, Mrs. Maureen Allagoa, Executive Director, Administration and Gana Mudu, Executive Director, Operations following their appointment as approved by President Muhammadu Buhari.
Also sworn in as nominal Directors were Mrs. Lauretta Adogu, Director, of the Department of Occupational Safety and Health, to represent the Federal Ministry of Labour and Alhaji Najeem Yasin, Deputy President, Nigeria Labour Congress (NLC), to replace the late Khaleel Ibrahim, who died in October 2020.
Whether the new team will break the jinx remains to be seen, but it has one unique advantage which the two previous boards didn’t have. Both the MD and three other executive directors were appointed in-house.
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