The Nation Newspaper

Category: Business

  • Late remittance of deductions to attract fine, warns PenCom

    The National Pension Commission (PenCom) has warned employers to submit deductions in respect of pensions’ contributions within two weeks or risk two per cent fine.

    In a statement, it said: ‘’Employers are to remit employees’ contributions not later than seven working days from the day salary is paid.”

    It noted that if default persists after three months, one per cent of the outstanding pension would be paid to the commission.

    PenCom warned that it would sue defaulters if violation persists. It added that employers who refuse to give access to information about their staff would pay a fine of not less than N200,000 and that every false or misleading information would attract N100,000 fine daily.

    It said any employer who forces its employees to open an account with a Pension Fund Administrator (PFA), would pay N1,000 after three months per employee for every month of violation.

    Besides, it was gathered that the commission is seeking powers to enable it to sue employers for refusing to remit pension contributions.

    PenCom called for the amendment of Section 11(7) of the Pension Reform Act (PRA) 2004, saying the provision is faulty.

    It said: “Power to Institute Criminal Proceedings against Employers for Persistent refusal to Remit Pension Contributions: Section 11(7) should be amended to empower the Commission to institute criminal proceedings against employers who persistently fail to deduct and/or remit pension contributions within the stipulated time; review the penalties and sanctions, arguing that the sanctions provided under Section 85 are no longer sufficient deterrents against infractions of the PRA 2004.

    It, therefore, suggested that Section 85 should be amended to provide for stiffer penalties.

    Pencom’sDirector-General, Mohammad Ahmad, said 172 debt recovery agents had been employed to collect unpaid contributions, adding that they have resumed.

    He explained that the agents, who are lawyers and accountants, would ensure that employers comply with laws on remittance of their workers’ contributions.

    He noted that 50 per cent of the penalty from outstanding contributions recovered through the agents would be given to employees with RSA, while the balance would be used to defray the cost of recovery.

    He added that PFAs would not be allowed to charge administration fee on retirement savings’accounts that benefited from the recovery of the arrears.

    He said each agent’s performance would be monitored based on performance.

    He said: “The Commission would hold quarterly meetings with the recovery agents and PFAs to discuss remuneration of recovery agents which would be performance based. The remuneration would be met from the interest penalty charged on the outstanding contributions recovered through the efforts of the agents and administration fees charged by PFAs.

    “In that regard, 50 per cent of the interest penalty would be used to defray the cost of recovery while the balance would be for the benefit of the RSA holder. In addition, PFAs would not be allowed to charge administration fee on RSAs that benefited from the recovery in the arrears or in retrospect.

    “Recovery agents would be required to submit monthly progress report with respect to recoveries from employers assigned to them. The reports would be reviewed to determine if the performance of the agent is satisfactory or otherwise. Challenges encountered and ways forward would also be reviewed. The compliance and enforcement department would be responsible for the implementation of the framework in conjunction with other relevant departments in the commission.

    “The Commission would provide the secretariat and basic resources, such as telephone and Internet access for use of the recovery agents. The secretariat would be located in the Commission’s office. The framework is subject to a periodic review to ensure speedy recovery of un-remitted pension contributions by employers.”

  • $7.9b loan: Senate cautions states over reckless borrowing

    $7.9b loan: Senate cautions states over reckless borrowing

    The Senate yesterday warned state governments against reckless borrowing, saying it would not acede to every request.

    Chairman, Senate Committee on Local and Foreign Loans, Senator Ehigie Uzamere, gave the warning at the continuation of the defence of a loan of $7.9 billion by the Federal and state governments.

    Uzamere said states which were expecting blanket approval of requests for loans should forget it, because his committee would not grant their requests.

    He stated that approved loans must not be seen by benefiting states as free money that should end up in private pockets.

    “It is sad the way we are going in this country,” he said, adding that states must take loans seriously.

    He noted that the committee would monitor the use of the loans through oversight to ensure that they are not diverted.

    He urged the states that have not submitted their template for loans to do so because the Federal Government was awaiting approval of the loans.

    He insisted that requests by states that fail to submit their template would not be considered.

    A member of the committee, Senator Gbenga Obadara, also warned that there was no reason for any state to “over borrow.”

    He said: “These loans, you are not the ones to repay it. This is how our nation became a debtor nation and we battled to free the nation from huge foreign debts.

    “From what I see, the debt profile will continue to pile up. I don’t want my children to become slave of any nation because of loans. We know the consequences of these loans. You may mean well, but you must be careful how you borrow.

    “Some states have asked for $50 million loan, others asked for more. You begin to wonder how much is the GDP to warrant the huge loans.”

    Delta State Commissioner for Finance, Mr Bernard Okumagba, who defended his state’s request, noted that there was a huge funding gap in the state’s drive to successfully implement some projects.

    Okumagba said the terms for the credit are maturity spanning 40 years, a grace period of 10 years, service charge of 0.7 per cent and commitment charge of 0.5 per cent.

    He said the projects for which the loan are sought included youth empowerment and access to socio-economic services, public financial management reforms and project coordination and implementation support.

    The Commissioner noted that the credit amount negotiated in November 2011 by the Federal Government, participating states and World Bank is $200 million.

    He added that an additional equivalent of $110 million has been approved as grant by European Union (EU) to support project development objectives in the participating states.

    Okumagba said $39.78 million has been tentatively allocated to Delta State based on the original credit and will be scaled up to include the EU grant when the approved amount is released.

    Delta State, he said, is interested in the approval of the project “which is expected to create about 16,100 jobs for youths in the state.”

    He said about 7,500 persons would have access to services, such as basic health, education, water and agricultural extension, supported under the community driven development sub-component in benefiting communities.

  • MTN backs bank-led mobile money services

    MTN backs bank-led mobile money services

    MTN Nigeria is supporting the Central Bank of Nigeria (CBN’s) bank- led mobile money model.

    The CBN recently licensed some financial institutions to carry out mobile money services with the objective of providing easy money transfer services, using mobile phones and enhancing financial inclusion, particularly in rural areas.

    MTN’s Corporate Services Executive Akinwale Goodluck, said the CBN bank-led model has many merits and that it is full implementation would achieve the CBN’s stated objective to extend money transfer services to millions of Nigerians who are currently underserved.

    “We are supportive of any initiative that brings financial inclusion to the masses and the Central Bank’s efforts in this regard are highly commendable,” Goodluck who spoke at a capcity building forum in Lagos said at the weekend, adding that the partnership between licensed organizations and telecommunications companies is a win-win combination.

    He said, “The current partnership between banks and telcos in the mobile money space leverages available cutting edge ICT technology offered by telcos and best practice payment protocols and expertise supervised by the CBN.”

    During the seminar, participants gained a better understanding of the details of the CBN guidelines and discussed various ways in which MTN could offer tangible backbone and logistical support to licensed organizations.

    In his closing remarks, Goodluck remarked that as the leading ICT company, MTN’s greatest responsibility to its customers and to Nigeria is to provide world class quality of service in order to support a multitude of products and services. He observed that MTN Nigeria had already built the largest and most sophisticated network in Africa.

    “The world today is heavily dependent on ICT. Our future success as a company depends on how well we support services like mobile money,” he said.

  • NAMA handles 500 aircraft daily

    NAMA handles 500 aircraft daily

    The Nigeria Airspace Management Agency (NAMA) handles about 500 aircraft and 300 helicopters daily, the Managing Dirctor, Nnamdi Udoh, has said.

    He told The Nation that the aircraft are aside the numerous foreign aircraft that over flies the nation’s airspace en route other countries.

    He explained that the increased number of aircraft that use the nation’s airspace  would continue to challenge the infrastructure,  including radio communication between the pilots and air traffic controllers.

    The NAMA boss explained that because of the increasing traffic on the nation’s airspace, the agency has taken steps to improve air navigation infrastructure, including the total radio coverage of the country, the total radar coverage of Nigeria, as well as the performance based navigation for which Nigeria is the first country in Africa to implement it.

    He said the airspace agency has been approached by many private airstrip and aerodrome operators to provide air traffic services, which is evidence of improved infrastructure and recurrent training of it’s personnel.

    He explained that this year alone, NAMA has trained at least 300 air traffic controllers in the U.S, South Africa and Egypt in many areas of air traffic management.

    Udoh said the agency will continue to invest in the training of its personnel, which he said is key to ensuring that Nigeria meets the minimum acceptable standards in air traffic services.

    He explained that it is wrong for anybody to insinuate that the Nigerian airspace is unsafe, as it will be unprofessional for any air traffic controller to suggests so, even as he affirmed that no airline pilot will embark on any flight without receiving air traffic instructions from the control tower.

    He wondered why more foreign airlines will like to fly into the Nigerian airspace , if it is not safe, even as he said that without radio communication, which could have issues of congestion, the pilots could still land their aircraft.

    He said : “ If all is well, there will be no air traffic control, those that design air traffic control know that there will be problem like this but let quickly say that no pilot can fly an aircraft from the ground without receiving an instruction.

    For the record and for the umpteenth time the agency want to use this opportunity to reassure Nigerians that our airspace is safe as in safe and as should be safe.

  • Our strategy for massive job creation, by SURE-P

    Resuscitation of the defunct Public Works Department (PWD) and rehabilitation of the near-comatose rail transport system are some of the strategies employed by the Subsidy Reinvestment and Empowerment Programme (SURE-P) of the Federal Government.

    Speaking in Lagos, Nse Akachukwu Nwankpo, the Special Adviser to the President of Technical Matters and Secretary, SURE-P, said others were massive investment in the provision of health infrastructure targeted, especially at reducing child/mother mortality rate, employment of midwives, completion of strategic abandoned projects and a host of others, challenging the other two tiers of government, state and local, to make the impact of the SURE-P funds allocated to them trickle down to the people.

    He said the intervention agency has done a lot considering the short time it was constituted and when it actually went out to work.

    Nwankpo said the agency, which was a child of necessity, was created as an intervention body by President Goodluck Jonathan to bring succour to the common man on the streets of the country, adding that this vision of the president stood at the centre of the choice of the agency in the choice of areas of intervention.

    According to him, in the last count, the country is littered with about 12,000 abandoned projects valued at about N7.7 trillion, adding that the agency has selected the projects that have mass-effects on the people for completion.

    He cited six major road projects being handled by the agency to include East-West road, Onitsha-Enugu raod, Port Harcourt road, Lokoja road and two others, adding that in addition to this, the agency is also supervising the completion of two key bridges-Oweto Bridge and the second Niger Bridge.

    “Maintenance of roads is an area we are working on. We are investing bringing in automatic road patchers not using spade. We are working with the Federal Road Maintenance Agency (FERMA) with a view to bringing back PWD,” he said, adding that vocational centres have also been established.

    He said a total of N135 billion has so far been received by the agency, stressing that the money is not kept with any commercial bank but with the Central Bank of Nigeria (CBN). According to him, in order to avert the drift, the sum of N70 billion has been paid based on performance of job.

    Speaking on the Second Niger Bridge for instance, he said it is going to be based on Private- Public Partnership (PPP), adding that about N5billion counterpart funding has been paid while a transaction adviser has been appointed.

  • Oxfam to fight poverty with five million euro

    The Country Director, Oxfam Nigeria, Dr. Chichi Okoye, has said Oxfam has budgeted over five million euro in addressing poverty in Nigeria, especially in assisting small scale farmers in the next three years.

    Okoye stated this during a press conference on ‘Go live’ in Abuja, saying it is time to challenge the government on how to meet the need of small scale farmers in Nigeria.

    She said: “In Nigeria the Single Management System (SMS) process has led to Oxfam GB and Oxfam Novib developing a joint country strategy which outlines our areas of focus and ways of working for the next three years.

    “With a combined annual budget of over five million euro, the new Oxfam in Nigeria will be more robust and aggressive in addressing issues of poverty in Nigeria.

    “Oxfam aims at achieving this by saving lives and responding swiftly to provide aid support and protection during emergencies. Develop programmes and solutions that empower people to work their way out of poverty.

    “The organisation has recorded some success by raising the voice of the small scale farmers, especially women farmers through the GROW campaign which is primarily focused in simple terms on food access, availability and production.

    “It also aims to ensure that small scale farmers are empowered to meet food demands through increased investment in agriculture and building their resilence towards food price volatility.

    “We have helped organised small scale farmers by providing support for the establishment of the association of small scale agro producers in Nigeria ASSAPIN the first ever association of small scale farms in Nigeria.

    “Oxfam has successfully linked Cocoa farmers in Ibadan to a chocolate factory in the Netherland where the Cocoa farmers will supply the factory with Cocoa for their chocolate at a fair price and under favourable working conditions. We are hoping to replicate this with other produce,” she stressed.

    On December 13, 2012, the two Oxfam that operats in Nigeria, Oxfam Great Britain and Oxfam Novib Netherlands, are coming together as one Oxfam. It will be marked by the signing of Memorandum of Understanding (MOU) in a ceremony tagged Go live in Abuja.

  • World Bank, Lagos plan multimillion fish market

    World Bank and the Lagos State government are planning a state wide multimillion fish market projects as part of its efforts to ensure food security and boost development.

    Though no figure was given for the project, the Commissioner for Agriculture and Cooperatives, Prince Gbolohan Lawal,who announced this while speaking with reporters in Lagos at the seventh Joint FGN /World bank said the fish mart projects is part of its multi-million fisheries transformation programme to rejuvenate the economy and provide fishing jobs for people.

    Like the Eko farmers mart initiative, he said the facilities which will be located in major areas of the state will include a fish grading area, a cold store and display areas for fish mongers and additional new jobs in the long term.

    He said the project will use the value-chain model, an approach to economic development to connect and strengthen all levels of an industry supply chain.

    According to him, the supply chain for fish and fishery products can involve a large number of stakeholders. These comprise stakeholders such as producer, wholesaler, dealers, middlemen, retailer, processor and consumer.

    He said there is effort to improve value addition and bring the different forms of fish products to the market place.

    To keep increasing fish supply, Lawal said aquaculture is becoming an important occupation while bridging the gap between demand and supply.

  • ‘Govt records N459.1b budget deficit in Q3’

    The nation’s budget deficit more than doubled in the third quarter to N459.1 billion ($2.9 billion), the Central Bank of Nigeria (CBN) has said.

    The budget deficit of sub-Saharan Africa’s second-largest economy jumped from N211.8 billion in the previous three months and N161.1 billion in the third quarter of 2011, the Abuja-based bank said in a report on its website.

    “The deficit was financed mainly from domestic sources, particularly through the issuance of additional Federal Government of Nigeria bonds,” the bank said.

    The country increased its target for this year’s budget deficit to 2.97 per cent of economic output in February, from a 2.77 per cent target announced in December 2011, after it added N733 billion of spending on fuel subsidies, according to the Finance Ministry.

    The country wants to narrow the fiscal deficit to 2.2 per cent of GDP next year, according to the October 10 budget proposal by President Goodluck Jonathan.

    During the period, N26.2 billion were withdrawn from the excess crude account “to bridge the shortfall in revenue for the period,” leaving $9.3 billion in the account, in which Nigeria saves revenue from crude sales higher than the budgeted price, the bank said.

    The government aims to raise savings in the account to $10 billion to provide a buffer against global economic uncertainty. Net foreign-currency inflows through the bank in the quarter stood at $5.8 billion, with inflows at $14.4 billion and outflows at $9.2 billion, according to the report.

  • ‘Include 13% derivation in new constitution’

    Oil Producing communities in six states have urged the National Assembly to include the 13 per cent derivation in whatever formula they come up with in the new constitution.

    This was contained in the letter the communities presented to the Fiscal Responsibility Commission in Abuja and made available to the media yesterday.

    In the letter, the group said whatever formula the National Assembly adopts in the proposed new constitution, it must reflect the 13 per cent Derivation.

    Acting under the aegis of the Oil and Gas Communities of Nigeria, the members of the oil and gas producing communities took their agitations for direct payment of the 13 per cent derivation by writing to the Fiscal Responsibility Commission (FRC) and stating their demands and asking for consideration.

    The letter, which was signed by Chief William Igere, who represented Delta State; Pastor Macpherson Kurobo, representative of Bayelsa State; Princess Nomwen Uhunmwangho of Edo State; Chief Harry Opaks of Rivers State; Comrade Samuel Ebiwanno, representative of Ondo State and Saviour James Okon of Akwa Ibom State, the communities demanded the direct payment of the funds to them.

    The group said the principle of 13 per cent Derivation is firmly entrenched under the provisions of Section 162 (2) which supports the payment of the derivation fund to the communities.

    Beyond that, they stated in their letter to the Fiscal Responsibility Commission (FRC) that the intended beneficiaries of this 13 per cent Derivation Fund are the oil producing communities because they directly feel the effects of oil and gas exploration and exploitation.

    As a result, “the principle of derivation is thus introduced to cushion the effects of this devastation of oil exploration as well as to recompense them for divesting them of their proprietary right.”

    According to the six individuals who signed the letter which was also sent to the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) last week, ”the 13 per cent Derivation Fund belongs to the oil and gas producing communities which are the sources of derivation.

    “The oil facilities, flow stations etc. are located in the oil and producing communities where oil exploration, exploitation and production are being carried out causing monumental degradation, pollution and health hazard etc 13 per cent Derivation Fund is compensation and reparation for loss of fishing right and loss of productive farm land,” they said.

  • Nigeria spends N11b on tomatoes import

    Nigeria is spending over N11 billion yearly on the importation of tomatoes, the Director-General, Raw Materials Research and Development Council (RMRDC), Peter Onwualu, has said.

    He disclosed this at the opening of a workshop on tomato juice processing and marketing in Gusau, Zamfara State.

    He said the country’s overdependence on the importation of tomatoes costs the huge sum and that the trend would continue until adequate domestic food processing and storage facilities are put in place.

    The RMRDC boss said tomato could be processed into sauce, ketchup, paste, jam, among others, likewise onion and pepper, which could also be canned or dried.

    He said using locally developed technologies at lower cost would enhance the production and value-addition to the primary and secondary raw materials to meet the needs of the nation’s industries.

    The RMRDC, according to him, has adopted a strategy to encourage value-addition to local resources, such as fruits and vegetables.