The Nation Newspaper

Category: Special Report

  • Lagos unveils bold relief plans to combat economic hardship

    Lagos unveils bold relief plans to combat economic hardship

    Amid escalating inflation and soaring commodity prices, Governor Babajide Sanwo-Olu has unveiled a comprehensive relief plan aimed at mitigating the impact of economic hardship for Lagos residents. From targeted financial assistance programmes to innovative job creation strategies, the relief measures demonstrate a holistic approach to revitalising the economic landscape and easing hardship. Associate Editor ADEKUNLE YUSUF reports

    It was a highly anticipated event–one that garnered significant attention and received an enthusiastic response from the audience. “As we navigate the unique economic realities in the country, it is important as the chief economic and security officer of our state to share some key policy changes for the welfare of all Lagosians,” Governor Sanwo-Olu wrote on his X handle on Wednesday last week; asking the public to stay tuned for more information during a live media session scheduled for 11:15 a.m. the following day.

    And exactly at the appointed time last week, in a proactive move to address the prevailing economic challenges, Governor Sanwo-Olu took centre stage, engaging with journalists to unveil a series of robust relief initiatives.

    During the live chat, expertly moderated by esteemed media personalities, including Dr Reuben Abati from Arise TV, Babajide Kolade-Otitoju representing Television Continental (TVC), Mrs Adesola Kosoko, the General Manager of Lagos Television, and Jeffery Uzomma from Channels TV, Governor Sanwo-Olu adeptly unveiled his plans while engaging with probing questions from the panellists.

     The relief plans, described as both bold and expansive, encompass a spectrum of measures tailored to address the diverse needs of Lagosians.

    From targeted financial assistance programmes to innovative job creation initiatives, the blueprint demonstrates a holistic approach aimed at revitalising the economic landscape and fostering inclusive growth. Crucially, Governor Sanwo-Olu emphasised the imperative of collaboration and collective action in navigating the current economic turbulence. Recognising the interconnected nature of challenges, he rallied stakeholders from across sectors to join hands in forging a path toward sustainable recovery and progress.

    Lately, tension has gripped the country amid a backdrop of mounting hardships, with inflation soaring and the cost of living reaching unprecedented heights in the wake of significant policy shifts. The removal of fuel subsidies and the decision to float the naira, allowing market dynamics to dictate its value, have precipitated a cascade of economic repercussions.

    These policies, while intended to foster greater economic autonomy, have instead catalysed a sharp uptick in the prices of essential commodities and services, exacerbating the plight of ordinary citizens. The removal of fuel subsidies has triggered a domino effect, leading to a surge in transportation costs and a ripple effect across various sectors of the economy.

    Coupled with the floating of the naira, which has introduced volatility into currency markets, the resultant inflationary pressures have further compounded the challenges faced by individuals and households nationwide. As prices skyrocket and purchasing power dwindles, the spectre of financial strain looms large, casting a pall over the livelihoods of countless citizens.

    In this climate of uncertainty and economic turbulence, the Lagos State Government admitted that it recognised that the resilience of the populace is being put to the test, as communities grapple with the harsh realities of diminished affordability and heightened financial strain. To this effect, it has rolled out urgent measures to alleviate the burden on the most vulnerable segments of society and chart a course toward sustainable economic stability.

    Education, health, transport, food availability and affordability

    Moreover, ensuring the availability of affordable food options stands as a cornerstone of the relief measures, directly tackling the fundamental need for sustenance amidst escalating prices. Governor Sanwo-Olu stressed that his administration is strategically intervening in the food supply chain to guarantee that nutritious and economical meals remain accessible to all Lagosians, especially those grappling with economic hardships. In addition to addressing immediate needs, the government has placed a premium on health and education palliatives, acknowledging the intrinsic interconnectedness of these vital sectors. Through initiatives aimed at enhancing access to healthcare services and educational resources, particularly for vulnerable demographics, the state government aims to cultivate resilience and empower individuals to navigate the challenges posed by economic uncertainty. Governor Sanwo-Olu underscored that these comprehensive relief measures reflect the government’s steadfast dedication to the welfare of its residents, epitomising a proactive stance in confronting the prevailing challenges. By prioritising the well-being of its populace, the government is demonstrating a commitment to fostering resilience and prosperity in the face of adversity.

    “We are not unaware and unmindful of the current situation, but as leaders, we have the responsibility to bring immediate ease to our people. Given the nature of the challenges that we are facing presently, we have designed creative means to ease the hardship on our people. As incident commander, I am giving you the commitment that the bipartisan advisory committee that we have put together will welcome ideas and advice from everyone that can lead to more solutions out of the challenges that we have found ourselves.

    “In terms of policies, we will continue to do everything within our means that the greatest good gets to the greatest number. Lagosians are resourceful and hardworking, they are commercially driven self-starters. Those are the values I want all of us to build our hope around,” Sanwo-Olu declared with empathy to citizens over the current hardship occasioned by inflation in commodities prices.

     As part of efforts to alleviate the strain of the current economic climate, Governor Sanwo-Olu announced a new work schedule for the state’s civil service workforce. Beginning this week, employees on Grade Level 1 to 14 will be permitted to work three days per week until further notice. Additionally, civil servants in Grade Level 15 to 17 will have a four-day workweek. He highlighted that this adjustment is not intended to disrupt governance but rather to alleviate the burden borne by workers amidst economic challenges. The measure aims to reduce the daily pressures faced by employees in fulfilling their duties during this period of hardship, ultimately easing their workload and mitigating additional stress.

    In addition to the revised work schedule, Governor Sanwo-Olu has announced a 25 per cent fare reduction across all State-owned public transport services, including BRT, train, and ferry services. This initiative seeks to alleviate the financial strain on commuters grappling with rising transportation costs. He has directed all government departments and agencies to promptly implement these measures, stressing the administration’s commitment to addressing the immediate needs of its citizens. He conveyed his deepest empathy for the challenges faced by the populace due to inflation and soaring commodity prices, highlighting the government’s responsibility to provide immediate relief to the people. In his address, Governor Sanwo-Olu assured the public that these interventions are just the beginning of creative strategies designed to ease hardship and foster resilience among Lagosians.

    “I convey our deepest empathy to our citizens over the current hardship occasioned by inflation commodities prices. We are not unaware and unmindful of the current situation, but as leaders, we have the responsibility to bring immediate ease to our people. Given the nature of the challenges that we are facing presently, we have designed creative means to ease the hardship on our people, starting with public servants.

    “Effective next week, the working hours of workers from Level 1 to Level 14 in the State’s civil service will be rescheduled. They will now come to the office for a maximum period of three times a week. This measure will not shut down governance, nor will it disrupt the operations of the Government. It will all be calendarised and scheduled. Workers in Level 15 to Level 17 will be required to work four times in a week. All we seek to achieve is to reduce the pressure on our workers and save them from additional stress.

    “The rising cost of transportation has also made it pertinent for us to initiate an intervention in the sector. For the public using the government-owned transport services, we are implementing a 25 per cent fare reduction on all our public transportation channels. We are also working with various commercial transporters to assist in the little way we can to ease the situation. Instructions have been given to government functionaries for the implementation of these measures; modalities will be provided,” he said.

    To combat the escalating food prices, Governor Sanwo-Olu has unveiled a three-pronged approach to agricultural intervention. The state government will distribute combo packages of food items to vulnerable households, targeting 300,000 families. Over 100 trailers of rice and other essentials have been procured, with logistics being fine-tuned for seamless distribution. In addition, Lagos will inaugurate “Sunday Markets” in 42 communities, offering staple foods at reduced prices. Shoppers can purchase items up to N25,000, with a 25% rebate immediately after. This initiative will run for five weeks. Furthermore, the “Soup Bowl” programme, previously implemented during the COVID-19 lockdown, will be reintroduced. Local cafeteria operators will prepare meals funded by the government, with vouchers provided for free meals to residents.

    Read Also: Lagos taskforce receives petition over Ajah land grabbing

    In education, additional transport support will be provided for classroom teachers, ensuring they maintain their work schedules. Pupils in public schools will continue their five-day attendance, with the suspension of the directive requiring proof of tax payment for enrollment, aimed at discouraging absenteeism and dropout rates. In the health sector, Governor Sanwo-Olu has reinstated the free child delivery program in all state-owned General Hospitals and special maternity centres. The government will cover the costs of childbirth, including Caesarean sections, alleviating financial strain on families. Additionally, efforts will be made to reduce the cost of certain medications, such as hypertension drugs.

    Moreover, bi-weekly community health missions will be conducted across all six health districts in Lagos for the next three months. Residents will receive free check-ups for diabetes, blood pressure, and eye tests, with medications provided for observed conditions. Governor Sanwo-Olu also highlighted plans for infrastructure development, including the reconstruction of 180 inner roads in collaboration with local government authorities. Furthermore, Lagos is prepared to deploy 10,000 personnel for a state police force pending full constitutional approval from the Federal Government.

    In closing, Governor Sanwo-Olu emphasized the necessity for tough decisions in challenging times and urged against civil unrest or industrial action, noting that such actions would not provide solutions but instead exacerbate the situation. Governor Sanwo-Olu urged for patience and understanding; expressing confidence that the country will overcome its current challenges through the comprehensive reforms initiated by President Bola Ahmed Tinubu. As the incident commander, he assured Lagosians of his commitment to fostering collaboration and welcoming input from all quarters through the bipartisan advisory committee.

    Speaking directly to the people of Lagos, Governor Sanwo-Olu emphasized the importance of collective effort in finding solutions to the prevailing challenges. He reaffirmed his administration’s dedication to implementing policies that prioritize the well-being of the majority, leveraging the resourcefulness and industriousness of Lagosians to navigate through adversity.

    In his message, Governor Sanwo-Olu instilled hope and resilience, calling on all citizens to unite and draw strength from their entrepreneurial spirit and determination. He encouraged everyone to remain steadfast and optimistic, underscoring the inherent capacity of Lagosians to overcome obstacles and emerge stronger together.

  • Living on the margins: Overlooked struggles of persons with disabilities

    Living on the margins: Overlooked struggles of persons with disabilities

    Despite constant efforts to enhance the implementation of Nigeria’s national disability law since its enactment, there persists a significant gap in adherence and execution across various sectors. As a consequence, individuals with disabilities face exclusion from community events, encounter challenges in accessing buildings, healthcare facilities and transportation, and grapple with discrimination in multiple facets of their lives. Regrettably, the situation is no different in Niger State, as JUSTINA ASISHANA sheds light on these marginalised persons.

    Musa Bello found himself in a state of agitation. Despite his attempts to communicate the urgent medical needs of his wife through gestures, Musa, who has a speech impairment, encountered a frustrating barrier at Niger General Hospital. The medical attendant, unable to comprehend him, turned away.

    The absence of a sign language interpreter added to the ordeal, contravening the Discrimination Against Persons with Disability (Prohibition) Act. This legislation mandates the full integration of persons with disabilities and emphasizes the need for public hospitals to ensure special communication provisions for individuals facing such challenges.

    Frustrated by the lack of understanding, Musa lashed out at the medical attendant, prompting hospital officials to seek assistance from an official affiliated with an association for persons with disabilities to defuse the situation. Section V (24) of the law states: “A public hospital where a person with communicational disabilities is medically attended to shall make provision for special communication.”

    A 2023 study on the status of inclusive healthcare services in Nigeria recommended the construction of ramps, adapted examination tables and other facilities that enhance physical access and inclusion of persons with disabilities. The researchers also recommended the availability of information and communication aids such as material in braille and large print for patients with visual impairment, pictures and materials in simple language for those with learning disabilities and sign language interpreters for those with hearing and communication impairments. However, at the time of publishing this report, no public hospital in Niger State has provision for special communication for people with disabilities.

    It’s not just in hospitals that persons with disabilities face access challenges. The law provides for the full integration of persons with disabilities in healthcare, education, social, economic and civil rights, but in all these spheres, persons with disabilities in Niger State, and Nigeria at large, continue to face obstacles.

    Fatima Sani, who is visually impaired, feels a sense of dread every time she leaves home to go into town (Minna’s central business district). Although she has a white cane and her 12-year-old niece by her side to guide her, she has difficulty getting a keke (tricycle), which is the main mode of public transport. The keke drivers are impatient and don’t wait for her to board. In Minna, people are reluctant to help Fatima and her niece cross the busy roads. Fatima faces these challenges despite the law addressing accessibility to roads, sidewalks and vehicles. The law forbids discrimination against persons with disabilities in the provision of public transport. Refusing to provide services is an offence. The law states that a vehicle should stop for a passenger with disabilities to board or alight and that such a passenger should get priority in boarding. The law also requires that vehicles and bus stops provide functional accessibility aids (lifts and ramps) and that buildings provide special parking spots.

    According to the law, people with disabilities are supposed to be given priority in queues, but Mohammed Enagi, the Chairman of the Empowerment Initiative for Persons With Disability in Niger State, who has a physical impairment and rides a specially-designed motorcycle, said that at many filling stations, attendants ask him to wait in the queue and get off his motorcycle, even when he explains how they can accommodate him to fuel his motorcycle safely. He now prefers fueling at Bovas Filling Stations in Minna as they have shown sympathy and understanding to the plight of people with disabilities. The Discrimination Against Persons With Disabilities (Prohibition) Act states that persons with disabilities shall be given first consideration in queues, with offenders liable to a fine of N50,000 or six months in prison or both.

    Several people with visual impairment complained that bank officials would not issue them with ATM cards when they opened bank accounts.  Efforts to get a comment from the Bankers Association in Niger State on why ATM cards are not issued to visually impaired persons proved futile as officials neither picked up calls nor responded to messages.

    Persons with disability also still face challenges in accessing public buildings, including the office of the Niger State Commissioner for Humanitarian Affairs, which handles disability matters. Public buildings were given five years, which lapsed at the end of 2023, to make their buildings accessible by incorporating aids like lifts and ramps. Persons with disability, especially those with physical disabilities, said that whenever a meeting to discuss disability matters is held at the second-floor office of the Niger State Commissioner for Humanitarian Affairs, it takes them several minutes to take the stairs to the office, which has neither lifts nor ramps.

    Statistics on disability

    Disability is an umbrella term, covering impairments, activity limitations and participation restrictions. Impairments are problems in body functions or structures, while activity limitations are difficulties encountered by an individual in executing tasks or actions. Participation restrictions refer to challenges that interfere with a person’s ability to take part in different life activities.

    In other words, disability is not just one health problem. It is a complex phenomenon, reflecting the interaction between the features of a person’s body and the features of the society in which he or she lives. The most prevalent forms of disability in Nigeria include visual impairment, hearing impairment, physical impairment, intellectual impairment, and communication impairment.

    Globally, over a billion people are estimated to live with some form of disability. This corresponds to about 15 per cent of the world’s population. Between 110 million (2.2 per cent) and 190 million (3.8 per cent) people aged 15 years and older have significant difficulties in functioning. Furthermore, the World Health Organisation (WHO) observes that the rates of disability are increasing in part due to ageing populations and an increase in chronic health conditions.

    The last Nigerian census in 2006 reported that there were about 3.3 million people with disabilities or 2.3 per cent of the 140.4 million population. Then in 2018, the WHO estimated that about 29 million of the 195 million people who comprised Nigeria’s national population were living with a disability. Data from the 2018 Nigeria Demographic and Health Survey reveal that an estimated seven (7 per cent) of household members above the age of five (as well as nine per cent of those aged 60 or older) have some level of difficulty in at least one functional domain i.e. seeing, hearing, communication, cognition, walking, or self-care. One per cent either have a lot of difficulties or cannot function at all in at least one domain. Visual impairment is the most common type of disability in Niger State, according to the Nigeria Demographic and Health Survey, 2018.

    Disability rights

    In December 2006, the United Nations (UN) adopted the Charter on the Rights of Persons with Disabilities (CRPDs) which came into force in May 2008. Nigeria ratified the United Nations Convention on the Rights of Persons with Disabilities on March 30, 2007, and it’s Optional Protocol on September 24, 2010. Ratification is a concrete action taken by states which signal the intention to undertake legal rights and obligations contained in the Convention or the Optional Protocol. Nigeria is thus legally bound to uphold the rights contained in the CRPD.

    In 2019, the Discrimination Against Persons with Disabilities (Prohibition) Act was signed into law to protect the rights of persons with disabilities, provide for their integration into society and establish the National Commission for Persons with Disabilities (NCPWD) to oversee the implementation of the act. The commission was set up in 2020, and tasked with formulating and implementing policies, and guidelines, and monitoring implementation.

    The disability law encompasses several significant provisions, prohibiting all forms of discrimination based on disability, and imposing penalties such as fines and prison sentences for violations. It guarantees the right to education for individuals with disabilities at all levels, emphasising accessible facilities and learning materials in schools. It also ensures the right to health, encompassing affordable, accessible care and health insurance coverage, with healthcare providers required to make reasonable accommodations.

    The act also mandates disability-friendly public transport systems and provides concessions. Public life accessibility is safeguarded in the law, ensuring that public buildings, roads, business premises, and recreational centres are accessible. Public organisations are required to allocate at least five per cent of employment opportunities to people with disabilities, ensuring equitable salaries. The legislation mandates the inclusion of people with disabilities in political appointments with provisions made for accessibility during elections. The act further provides for the establishment of the National Disability Trust Fund.

    In 2020, the persons living with disabilities in Niger State decried the poor treatment of its members during the Special Public Workers Scheme of the Federal Government, as they claimed to have been shortchanged in the programme. The Chairman of the Joint National Association of Persons with Disabilities in Niger State, Isah Abdullahi, led a protest to the Secretariat of the Nigerian Union of Journalists in Minna, lamenting that despite the directive by the Federal Government to allocate at least five per cent of slots to PLwDs, they only got 0.4 per cent.

    Niger State was allocated 25,000 slots and persons with disabilities submitted 1,250 names to the National Directorate of Employment (NDE), with 50 representatives from each of the 25 local government areas. However, when the final list was released, it had only 100 names of persons with disabilities, or 0.4 per cent, instead of the required five per cent. Worse still, the names were from only two local government areas.

    The chairman says that persons with disabilities would now begin seeking legal redress against any individual or organisation that discriminates against its members, though he acknowledges that ignorance of the anti-discrimination law drives stigma, with some parents still segregating their children who have disabilities. The Executive Director of Quality Lives for Persons with Special Needs Foundation, Abdulrahman Alwal, echoed this thought, pointing out that the State Government and other actors have yet to implement the Disability Act.

    He said that persons with disabilities, who are among the vulnerable group of women, youth and children, are yet to get the legally mandated commission, despite advocating for it. His words: “We should be given our position just like other vulnerable groups. Let all necessary provisions that we are entitled to also be given to us so that we can live favourably and conveniently.

    “We will adopt litigation because we have exhausted advocacy opportunities. We have spent too much on advocating; we will start litigating. When we go to a building and it is not accessible, we will take the organisation to court. Whatever should happen should happen; we have gotten to that point now. And even with this political inclusion and recruitment, we will start taking people to court and start prosecuting them because it is getting out of hand.”

    Alwal further stated that people with disability in Niger State are not given equal opportunities in education, employment, healthcare, transportation and other public services. “More than 300 people have been appointed politically in the state and not even one person with a disability has been considered. We have the educated among us, but they still face discrimination in employment. Somebody who has had NCE since 2011 is on the street begging because no organisation has employed him. We don’t get equal representation,” he added.

    While the educational sector is not as accessible and inclusive as it should be, several people with disabilities in Niger State have undergraduate and master’s degrees and diplomas, while others eke out a living in business. “We try our best to do the little we can to put food on the table. Another success is that we are still alive; we did not allow stigmatisation and suffering to send us to an early grave. We will live our lives till God takes it from us. We do not allow anybody or any pain inflicted on us to kill us. We will survive,” said Alwal.

    Mohammed Enagi who is the Chairman of the Empowerment Initiative for Persons with Disabilities in Niger States, runs an ICT training centre where people with disabilities are trained on various skills. Enagi, who is currently a student at IBB University, Lapai, initially started studying IT and Sharia Law in Saudi Arabia but returned home during the COVID-19 pandemic, and couldn’t return to complete his course due to a lack of funds. The university had asked for a letter of support from the Office of the Governor, but efforts to get it proved futile.

    Another major concern of persons with disabilities in Niger State is mobility and accessibility. The law provides for a five-year transitional period within which public buildings, structures and vehicles are to be modified to include necessary accessibility aids like ramps and lifts, and accessible sidewalks and footbridges. The transitional period commenced in 2018 and lapsed in 2023. However, a cursory look at the buildings and structures across the Minna metropolis showed that no move has been made towards this amendment even though new buildings keep springing up across different parts of the state capital daily.

    To this end, officials at the Niger State Ministry of Housing may face several lawsuits should persons with disabilities make good their resolution to take legal action. According to the Act, an officer who approves or directs the approval of a building plan that contravenes the building code commits an offence and is liable on conviction to a fine of at least N1,000,000 or a term of imprisonment of two years or both. Therefore, a person with a disability who is not able to access a public building has the right to make a complaint and the authority in charge of the building must fix such barriers or pay for damages suffered by the complainant.

    For the past three years, Abdulrahman Alwal, who is visually impaired, has been running ‘Nakasa Baka Saraba’ a radio programme on Badeggi Radio, creating awareness about the challenges faced by people with disabilities. He advocates for the inclusion of disability rights during policymaking at every level and the implementation of those rights to make inclusion a reality.

    Alwal stated that lack of political will has limited the usefulness of the law in Niger State. While acknowledging that the Ministry of Humanitarian Affairs had set up a desk for persons with disabilities and started giving them food aid, signalling renewed concern for the affairs of persons with disabilities, Alwal said much more remained to be done. For instance, he pointed out that many buildings still don’t have wheelchair-accessible toilets and lack light alarms to notify those with hearing impairment of other people’s presence or warn them of danger. He added that public buildings should have accessibility aids for all forms of disability, such as digital communication devices and sign language interpreters.

    Lacklustre response

    The Director of Rehabilitation Services at the Niger State Ministry for Humanitarian Affairs and Disaster Management, Hajara Ndayako, who serves as the Desk Officer for Persons With Disabilities said that the State Government is doing its best to empower and train people with disabilities to be self-dependent and to advocate and fend for themselves.

    “It is all about them rising for themselves. We encourage them to form associations and monitor their election of who will steer the affairs of their association. We also encourage them to form groups so that whenever there is assistance, they can push for inclusion, not only in this ministry but in other ministries and programmes,” she said.

    She added that though the previous government had not set up a Commission for Persons With Disabilities, her office was working to put disability issues on the priority list. “We intend to bring this issue before the governor. Other states have already gotten a commission as directed by the act. We are working hard on that because when it is in place, a lot of things concerning persons with disability will be addressed.”

    Ndayaka said several buildings such as the neonatal hospital and the women’s multipurpose centre had incorporated accessibility requirements during construction, and that her office draws attention to the need for disability-friendly buildings, whenever the State Government is putting up a new building. “Some of these changes cannot be radical; it takes time and we will continue to push and draw the attention of all the people that are needed to address that to do so. We are trying and we will keep pushing,” she said.

    Disability-friendly rating

    While Minna has made little progress in making the city disability-friendly, Abuja and Lagos scored 63 per cent and 51 per cent in a 2015 report on access to public infrastructure, published by the Center for Citizens with Disabilities. This is despite their strategic importance as the seat of government (Federal Capital Territory) and the commercial nerve centre of the country (Lagos).

    Nigeria could borrow a leaf from South Africa’s MyCiTi’s Integrated Rapid Transport System in Cape Town, a project that explicitly included universal design, making accessibility a project outcome. It is the first universally accessible transport system in Sub-Saharan Africa. It has wide entrance gates without turnstiles and railway stations are enabled for level and seamless boarding of vehicles. There’s also a fleet of low-floor kneeling vehicles that have wheelchair positions, as well as wheel-chair accessible toilets. Other universal access features include tactile paving to help the visually impaired locate stations and platforms, and induction loops at ticket kiosks for the hearing impaired. There are also boarding bridges on buses serving residential and central city routes, which provide passengers with level access to the buses from bus stops. Buses are also equipped with audio LED screens and service information in diversified formats. The stations and the buses have dedicated customer support staff enabling seamless traveling for persons with disabilities. Further, MyCiTi has a Dial-a-Ride, a dedicated kerb-to-kerb service for persons with disabilities who are unable to access mainstream public transport services.

    Hong Kong Public Transport System is another model system that integrates universal design ensuring seamless access to public transport for PWDs. The Transport Department set up a “Working Group on Access to Public Transport for Persons with Disabilities” with core mandates of tackling key transport challenges and addressing the transport needs of PWDs. Consequently, 30 per cent of the buses (about 2,000) are wheelchair-accessible and are equipped with a fixed ramp and wheelchair parking space inside the buses.

    Over 95 per cent of all taxis have braille and tactile vehicle registration number plates inside the vehicle compartment while about 7,500 taxis have talking meters that announce taxi service and taxi fare messages in diverse languages including English, Cantonese and Putonghua. Similar to Cape Town’s MyCiTi’s Dial-a-Ride service for PWDs, the Hong Kong government funds Rehabus services, a territory-wide transport network with a fleet of 90 wheelchair-accessible buses, for individuals unable to access public transport.

    In Kenya, Nairobi County introduced a digital zebra crossing along Harambee Avenue and Uhuru Highway which ensures the safety of pedestrians with disabilities.

    Assistive technology

    Assistive technology enhances accessibility and improves the quality of life for persons with disabilities. Screen readers convert text to synthesised speech, allowing individuals with visual impairments to access and navigate digital content. Braille displays convert digital text into braille, providing tactile feedback for individuals with visual impairments, and text-to-speech software and customisable communication boards help individuals with speech or communication difficulties express themselves.

    Other technologies include hearing aids which amplify and clarify sound for individuals with hearing impairments, improving their ability to perceive and understand speech and other sounds, adaptive keyboards that customise keyboards with larger keys, tactile feedback, or alternative layouts to assist individuals with motor skill challenges, and eye-tracking technology which allows individuals to control a computer or device through eye movements, benefiting those with mobility impairments.  Prosthetics and exoskeletons assist individuals with limb differences or mobility impairments by providing support and enhancing mobility, smart glasses (augmented reality glasses) provide real-time information, aiding individuals with visual impairments in navigation and recognising objects, and voice recognition software transcribes spoken words into text, facilitating hands-free computer operation for individuals with mobility impairments. Accessible mobile apps with features like voice commands, screen magnification, and captioning, enhance accessibility for various disabilities, while closed captioning and subtitles provide text descriptions of audio content in videos, benefiting individuals with hearing impairments amongst others.

    Alwal uses Okam My Eyes, an app that helps him scan newspapers and books and do his financial transactions independently, thereby improving his financial security. He also has an app that can take pictures of a person or place and describe them.

    In many African countries, many persons with disabilities don’t have access to these and other assistive technologies. WHO data from four African countries found that only 17 per cent to 37 per cent of people received assistive devices such as wheelchairs, prosthetics and hearing aids; and only 26 per cent to 55 per cent received the medical rehabilitation they needed, while only 17 per cent to 37 per cent received the assistive devices they needed such as wheelchairs, prostheses and hearing aids.

    • This article was produced with the support of the Africa Women’s Journalism Project (AWJP) in partnership with the International Center for Journalists (ICFJ) with support from the Ford Foundation.
  • African Alliance’s ‘technical insolvency’ leaves policyholders in limbo

    African Alliance’s ‘technical insolvency’ leaves policyholders in limbo

    • We’re fulfilling our obligations, says firm

    In the fading glow of financial stability, African Alliance Insurance Plc teeters on the brink of technical insolvency, leaving it unable to uphold its fundamental pledge of honouring claims. A thorough investigation unravels a protracted struggle within the company, transforming its premises into a battleground where beleaguered policyholders engage in arduous conflicts to secure rightful claims and receive payouts upon the maturity of their savings policies. This grim scenario is not a recent development; it has persisted for over a decade, marked by relentless losses, precarious cash flow, escalating bad debt and a growing inability to meet current liabilities. Policyholders find themselves caught in the crossfire, prompting a visit from our correspondent to the company’s premises, unveiling firsthand the plight of those entangled in African Alliance Insurance Plc’s financial predicament. OMOBOLA TOLU-KUSIMO reports

    A disconcerting analysis of critical performance metrics and indicators has brought to light a distressing revelation about the financial health of African Alliance Insurance Plc – it stands on the precipice of technical insolvency, unable to fulfil its fundamental obligation of honouring claims. The investigation conducted by The Nation unveils a protracted struggle within the company, transforming its premises into a battleground where policyholders find themselves entangled in arduous conflicts to secure rightful claims and receive payouts upon the maturity of their savings policies.

    This grim scenario is not a recent development but has persisted for an alarming span of over a decade. The company’s financial trajectory has been marred by a relentless series of losses, a precarious cash flow, escalating levels of bad debt, and a growing inability to meet its current liabilities. The repercussions of this financial turmoil have reached policyholders who now find themselves grappling with the repercussions of the company’s precarious financial standing.

    In response to a surge in complaints and a public outcry regarding the non-payment of claims and savings policies, our correspondent embarked on a visit to the company’s premises. This investigative journey provides firsthand insight into the plight of policyholders caught amid African Alliance Insurance Plc’s financial predicament. The investigative visit exposed a disheartening scene as beleaguered policyholders besiege the premises of African Alliance Insurance Plc at 54 Awolowo Road, Ikoyi, Lagos, daily. Their collective demand resonates with the urgency for the company to settle their unpaid claims and savings policies. Adding a layer of tension to this already fraught atmosphere, the company has stationed a policeman at its front desk, a move that further fuels the flames of frustration among the aggrieved policyholders.

    The newspaper’s observations extended beyond the mere presence of security personnel. The front desk staff, tasked with interfacing with customers, were noted for their hostility, rudeness, and lack of professionalism, exhibiting behaviour that contravenes the ethos of customer service. Of particular concern was the propagation of misinformation, with staff erroneously asserting that the waiting period for claim processing, from submission to payout, spans an astonishing 50 working days. This stands in stark contrast to the regulatory mandate set by the National Insurance Commission (NAICOM), which stipulates a more reasonable timeframe of 48 hours.

    The unsettling scenario took an even more alarming turn when the deployed policeman not only endorsed but actively expounded on this misleading narrative on behalf of the company. When confronted by our correspondent, who assumed the role of an aggrieved policyholder seeking clarification, the policeman responded with aggression, issuing threats and displaying an unwarranted readiness to retaliate against any probing inquiries.

    Incorporated as a private limited liability company in 1960, African Alliance Insurance Plc underwent a transformative journey, transitioning to a public liability company in June 2008 through a successful private placement exercise. This pivotal move culminated in the company’s listing on the Nigerian Stock Exchange on September 17, 2009. Currently, African Alliance Insurance Plc holds a noteworthy position in the industry, boasting 100 per cent equity ownership of Axiom Air Limited, a cargo airline company, and a substantial 98 per cent stake in Ghana Life Insurance Company Limited, a prominent life insurance entity in Ghana.

    The core focus of the group revolves around the provision of life assurance and pension services, catering to both corporate and retail clientele in Nigeria and Ghana. The financial performance of the group in 2021 showcased a commendable profit after tax of N2.4 billion, with the company separately reporting profits of N2.8 billion. These positive trends continued from the preceding year, with the group and company achieving profit-after-tax figures of N1.56 billion and N1.96 billion in 2020. Importantly, these profits have been prudently transferred to retained earnings, reflecting the company’s commitment to sustained financial health and stability.

    Deloitte’s statement on going concern status

    As of the financial year ending December 31, 2021, African Alliance Insurance Plc faces significant challenges flagged by its auditor, Deloitte. The identified going concern matters paint a concerning picture, showing a negative regulatory solvency margin of 713 per cent, a stark contrast to the required 100 per cent position mandated by the regulator, the National Insurance Commission (NAICOM). This critical financial metric underscores the company’s technical insolvency, raising alarm about its ability to meet regulatory obligations and fulfil its financial commitments. The auditor’s report sheds light on the urgent need for remedial actions to address the severe financial strain and safeguard the company’s viability.

    “The company’s solvency margin is below the regulatory requirement as stated in the Insurance Act CAP I17, LFN 2004 as it reported a solvency margin deficit of N12.3 billion for the year ended December 31, 2021 compared to a minimum of N2 billion required for life assurance companies. Similarly, the total admissible assets of the company less net insurance and investment contract liabilities amounted to a deficit of N23.2 billion as at December 31, 2021.”

    The company’s financial report as of December 31, 2021, showed a concerning negative shareholders’ fund of N4.29 billion. Deloitte’s assessment, taking into account the company and group’s performance as well as financial statements, highlights critical issues, such as a deficit in the solvency margin and the inadequacy of regulatory admissible assets to cover insurance liabilities. Collectively, these indicators signify a material uncertainty, casting significant doubt on the company’s ability to sustain itself as a going concern.

    “The board of directors assessed its ability to continue as a going concern and is satisfied that it has the resources to continue in business for the foreseeable future based on the following action plans that it is currently executing and will execute in the next 12 to 15 months.”

    The independent auditor noted that the company has taken certain actions in response to the regulatory solvency and liquidity breaches. However, Deloitte emphasised that these actions might not be adequate to fully resolve the identified issues. Furthermore, the auditor expressed uncertainty regarding how the regulatory body, NAICOM, will respond to the persistent non-compli ance with regulatory ratios.

    Action plans

    Deloitte reported that the Board of Directors unequivocally affirms the implementation of several action plans currently progressing through different stages of execution. The directors express confidence that these strategic initiatives will empower the company to rectify its standing and return to a going concern status without impediments. The comprehensive action plans include: Launching a rights issue of N2 billion shares for existing shareholders; attracting fresh capital through investment from new stakeholders; securing the renewal of overdraft facilities; executing the disposal of the company’s interest in Ghana Life Assurance Limited; initiating the sale of FGN bonds. Additionally, other action plan considerations involve: Acquiring dividends from PAL Pensions; focusing on the growth of Premium Income; and implementing de-risking measures for all new business ventures.

    The auditor said: “The directors have appointed relevant professional advisors to assist with the relevant processes of obtaining regulatory approval for a rights issue as soon as possible. However, the process is hinged on the conclusion of the FY2021 financial statements. Of significant impact is that Conau Trade and Investment Limited, the company’s majority shareholder, has underwritten to take on 100 per cent of the rights in issue when the right issues have been approved by the regulators and made available to the shareholders. Shareholders of the company at the last Annual General Meeting (AGM 2020) had given their consent and approval to the offering. This is, however, subject to the final approval of the regulators (National Insurance Commission (NAICOM), Financial Reporting Council of Nigeria (FRCN) and Securities and Exchange Commission. We are confident that the regulators will give their nod to the offering.

    “On injection of fresh capital by new investors, the Board of Directors are at the final stages of concluding an arrangement with an independent investor with plans to inject about N7 billion into the company as fresh capital. However, the process involves the conduct of due diligence on the financial statements of the company. The above-proposed capital injection has been approved by the shareholders at its last AGM in four phases which include Transaction preparation/Investor engagement; Documentation/Early Regulatory engagement; Phase III – Regulatory filings; and Allotment and listing. The Board of Directors has received the special resolution of the shareholders to proceed with the action plans and currently in progress. However, the success of this transaction is not under the control of the directors therefore there is material uncertainty as to the probability that this transaction will succeed.”

    Deloitte showed in its report that any business failing to align with its predetermined risk appetite is not accepted. This criterion has become evident in the frequency of claims recorded in recent months. The board remains optimistic that with the ongoing risk assessment process, it will witness added value and a notable reduction in claims payouts. While the outlined actions are expected to address the liquidity challenges faced by the company, its crucial to note that they may not fully alleviate the deficit in the solvency margin, as highlighted by the auditor.

    “Material uncertainty exists for each of these plans because of events that might be beyond expectations of the directors. There can be no assurance that the company will be successful with these strategic initiatives. If such initiatives and plans are not successful, the company and group may be forced to limit its business activities or be unable to continue as a going concern, which will have a material adverse effect on the operations and financial performance of the company. While the directors are confident that these action plans will be successful and have prepared these financial statements on a going concern basis, material uncertainties exist that may cast doubt on the company’s ability to continue as a going concern,” the auditor said.

    It is important to emphasise that when a company is no longer considered a going concern, it signifies negative trends, such as poor cash flow, the inability to secure credit or borrow, sustained losses, escalating levels of bad debt, challenges in meeting  liabilities (such as servicing loan repayments), and the presence of existing or impending legal actions against the company, among others.

    Management’s reaction to going concern status

    Joyce Ojemudia, the managing director, has shown that the directors have outlined specific measures and strategies to rectify the negative position, steering the company and the group towards profitability and an enhanced solvency position. However, as of December 31, 2022, the company grappled with a negative insurance solvency margin of N4.04 billion, a stark contrast from N12.3 billion in 2021. Ojemudia acknowledged that the total admissible assets, excluding net insurance and investment contract liabilities, reflected a deficit of N29.8 billion in 2021. She highlighted that the solvency margin fell below the two billion naira threshold required for life insurance by NAICOM. It’s noteworthy that the company has not distributed dividends to shareholders in the past decade.

    In the financial results of the group for the year ending 2022, there was a five per cent decline in premium income compared to the previous year, 2021. The group attributed this reduction to the challenging operating environment and the inability to consolidate the audited financial statement of its subsidiary, Ghana Life. However, there was a three per cent increase in Net Premium Revenue due to the group’s robust performance. Despite this, the group experienced an underwriting loss of N4.7 billion, a stark contrast to the N8.1 billion profit recorded in the preceding year, primarily due to unforeseen changes in contract liabilities.

    The investment income also took a hit, decreasing by 49 per cent as of December 31, 2022. This decline was attributed to a market-wide crash in interest rates, impacting the overall investment income of the group. Operating expenses of the group, on the other hand, witnessed a notable 25 per cent reduction for the year under review compared to the previous year, 2021. This reduction was a result of the group’s cost-cutting measures. Ultimately, the group reported a loss after tax of N2.9 billion, representing a 220 per cent decrease from the N2.4 billion profit recorded in the previous year.

    In 2022, the company enlisted the services of Messrs. Ukwuegbu, Ogbeleje & Co. as its auditor. The auditor, Mr. Ukwuegbu, who signed the report on the Valuation of Insurance and Investment contract liabilities, said the company is burdened with significant insurance and investment liabilities.

    He said: “The measurement of insurance and investment contract liabilities involves judgment over uncertain future outcomes as mortality, morbidity, lapse and surrender, among others and economic assumptions, such as interest rates, return on investments which are the ultimate total settlement value of long-term liabilities, including guarantees provided to policyholders. The insurance and investment contract liabilities of the group was N45.73 billion and for the company N43.97 billion, representing 96 per cent of the overall liabilities of the company.”

    Unpaid claims and policy holders’ dilemma

     In a more detailed examination of African Alliance’s financial results, it was shown that the company bears claims liabilities under Life Business amounting to N43 billion, with annuity claims reaching N29 billion in 2022. The critical point to emphasise is that being technically insolvent, the company lacks sufficient cash flow to cover these substantial claims, leading to concerns about the company’s underwriting practices and its management of assets and liabilities.

    An aggrieved policyholder, who visited the company to demand her money, shared that her colleagues who invested in the same savings policy had informed her that unless she created a scene at the company, her payment would not be processed. Consequently, she decided to make her presence felt, and after a period of confrontation, she was eventually attended to by the staff. Leaving the office with a smile, she seemed to have achieved the resolution she sought.

    The discontent among policyholders at African Alliance manifested in various scenes as numerous clients demanded the release of their funds. The presence of the unnamed policeman only fuelled the frustration among policyholders, who vehemently resisted any form of intimidation or harassment. Bayo, one policyholder, shared his frustrating experience with the company’s staff since the maturity of his savings policy and his subsequent payment requests. Khalid, holding a Takaful Plan policy with plan number MO4965, expressed the hardship he faced after investing his life savings, only to face refusal from the company upon maturity.

    Folake, with policy number M05731, is awaiting payment of over N250,000, while Adesina, holding policy number M05715, contributed N20,000 monthly for 19 months, totalling N380,000 without any interest accrual. The accumulation of such grievances among policyholders underscores the broader issues plaguing African Alliance. Lamenting, he said: “I started the Takaful Savings policy with African Alliance (AA) in May 2021, with a monthly contribution of N20,000. I saved for 19 months, which amounted to N380,000. I obtained, filled, and submitted my claim form AA in November, 2023. Ordinarily, payment of a claim does not take more than two weeks. I know this because I have been saving with them for years. As I noticed that this payment was not forthcoming, I went to their corporate head office where they told me that they did not see my claim form. They asked me to re-submit it to their mail, which I did immediately. They promised me that they would get back to me in the next two weeks. I am still waiting for them,” he noted.

    In the same manner, Mrs Adebanjo Fausat ldowu purchased two policies with numbers TO5006 and MO5532. She said the first policy started in January 2020 at the rate of N10,000 and the second policy started in January 2021 at the rate of N10,000.

    “My first payment is N415, 730 and my second payment is N350,435 both amounting to N766,165. I requested my money in June, 2023 and I only got a response from them in December.

    “I was in their office in the first week of January to create a scene because I learnt that is the only way I can get them to pay me. They called me in and appealed that they would pay me in one week so I left. Unfortunately, till date, they have not paid me. I am appealing to the newspaper to help me to retrieve my money from the company,” she cried.

    ‘We have been fulfilling claims for our policyholders’

      On the surge of policyholders demanding their funds and the apparent dissatisfaction, African Alliance’s Managing Director, Joyce Ojemudia, responded: “I would like to state that we have been consistently fulfilling claims for our policyholders. The information that we are not paying claims is not a factual representation of our company’s position. We have paid about N7 billion to our policyholders in one year.”

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    However, Mrs Ojemudia provided insight into the company’s solvency status in the 2022 financial report, saying: “The solvency level at the valuation date was 302 per cent for the company, compared to 713 per cent in 2021. The company’s assets do not match liabilities. Hence, asset admissibility requirements and localisation rules in Section 25 of the Insurance Act CAP I17 LFN 2003 were not met. The life fund shows a deficit of N29.8 billion as of December 31, 2022.”

    The Board of Directors comprises the Chairman, Dr Anthony Okocha–Sylva Ogwemoh (SAN), Managing Director/CEO Mrs. Joyce Ojemudia, Executive Director, Mrs. Olabisi Adekola, and Non-Executive Directors Alh. Abatcha Bulama, Dr. Adiele Ekechukwu, Sir. Macauley Atasie, and Dr. Alex Nwuba.

    The response from NAICOM to the company’s challenges and the status of the N7 billion fresh capital injections remain unclear at this time. In the 2022 result, the company said: “The Board of Directors is at the final stages of concluding arrangement with an independent investor with plans to inject about N7 billion into the company as fresh capital. However, the process involves the conduct of due diligence on the financial statements of the company. The above proposed capital injection has been approved by the shareholders at its last Annual General Meeting, and is in four phases, starting with Transaction preparation/Investor engagement; Documentation/Early Regulatory engagement; Regulatory filings; and Allotment and listing.

    “The Board of Directors has received the special resolution of the shareholders to proceed with the action plans currently in progress. However, the success of this transaction is not under the control of the directors, therefore there is material uncertainty as to the probability that this transaction will succeed.”

    On the rights issue of N2 billion shares to existing shareholders, “the directors have appointed relevant professional advisors to assist with the relevant processes of obtaining regulatory approval for a rights issue as soon as possible. Of significant impact is that Conau Limited, the company’s majority shareholder, has underwritten to take on 100 per cent of the rights in issue, when the right issues have been approved by the regulators and made available to the shareholders.

    “Shareholders of the company at the 2022 Annual General Meeting (AGM) had given their consent and approval to the offering. This is, however, subject to the final approval of the regulators, such as NAICOM, Financial Reporting Council of Nigeria (FRCN) and Securities and Exchange Commission,” the report read.

    Meanwhile, the Nigerian Insurers Association (NIA) has said it is working assiduously to redeem the image of the industry and restore public trust and confidence.

    The Chairman, Mr. Segun Omosehin said one of the challenges the industry is facing is the issue of public trust and confidence, saying NIA is working hard to enhance the industry’s credibility by encouraging members to pay claims promptly.

    “We discuss this extensively in all our meetings at the governing council. We have descended on members when we hear report of unpaid claims. This led to the publications we have done currently. We have done three publications where we are asking the public with genuine unpaid claims to come forward for payment,” he said.

  • Furore over currency for diaspora remittances payouts

    Furore over currency for diaspora remittances payouts

    Three years after the Central Bank of Nigeria (CBN) initiated a policy on diaspora remittances payouts in dollar and other foreign currencies, the move has generated a huge debate. Attempts by the apex financial regulator to reverse payments in naira exclusively has altered the narrative in the handling of payouts. What are the chances of the apex bank reinstating the dollar payout policy? And how viable is the move to cease foreign currency payments by reintroducing naira payouts? asks EKAETE BASSEY

    Handling of diaspora remittances has been a lingering issue in Nigeria for  years. Reason: There have been directives by financial regulators on the currency for payment of such inflow.

    The pendulum has been swinging in the direction of the indigenous currency: Naira and the world’s commonest currency for transactions – the United States Dollar.

    This has generated a huge debate in the financial and allied circles for some years.

    There behooves answers to these and more questions as Nigerians express their opinions on the issue. Some have praised the measure as a means of protecting the country’s currency, while others have forecast that it won’t last long.

    Still, others have criticised the measure, pointing out how weak the country’s legal tender has become in relation to other nations. They expressed their concerns that banks might not be transparent about the prevailing rate when purchasing dollars and other foreign currency from their customers.

    A civil servant-cum-entrepreneur, Godwin Archibong registered his dissatisfaction about the reinstatement of the rule requiring payouts in naira. He bemoaned the recent sharp decline in the value of the naira compared to other nations’ currencies.

    In light of this, Archibong remarked, quite perplexed, “How can I be sent dollars and you offer to pay me in naira?”

    This followed reports that the nation’s Deposit Money Banks (DMBs) and International Money Transfer Operators (IMTOs) had stopped paying their customers in dollars earlier this month.

    Customers of certain banks were notified that they would not be able to receive dollars from friends and relatives in diaspora after the Central Bank of Nigeria (CBN) published updated guidelines for International Money Transfer Operators on January 31, 2023.

    “The circular issued by the Central Bank of Nigeria dated January 31, 2024, stipulates that all in-bound money transfers to Nigeria (via the above-mentioned IMTOs) will be paid only in naira through a bank account or in cash at the prevailing rate in the Nigerian Foreign Exchange Market.

    “Furthermore, transfers exceeding the naira equivalent of $200 must be credited to the recipient’s bank account. Naira cash payment equivalent for amounts below $200 will require an acceptable means of identification. The acceptable means of identification is any of the following: international passport, Driver’s licence, National identity card, and INEC Permanent Voters Card.”

    The apex bank said recipients of inward money transfers to Nigeria would be paid in naira, either in cash or through a bank account, and that it would no longer permit IMTOs to make outward transactions under the updated standards.

    It further said that money exceeding $200 would be transferred via a bank account.

    “Proceeds of IMTO more than the equivalent of $200 shall be paid through an account. Cash payments shall be made upon the provision of a satisfactory/acceptable means of identification. Where the beneficiary does not have an account with the IMTO agent bank, the agent bank shall credit the beneficiary account in another bank.”

    Though banks and fintechs were prohibited from providing foreign money transfer services, according to the guidelines; nonetheless, banks could function as agents and the majority already are.

    “All banks are prohibited from operating International Money Transfer Services but can act as agents. Also, financial technology companies are not allowed to obtain approval for IMTO,” part of the revised guidelines stated.

    Also, depending on the official foreign exchange rate in the market, the apex bank requested quotations from IMTOs for the naira distribution to beneficiaries.

    Last Thursday, The Nation discovered that banks were pressuring their clients to sell the foreign exchange in their facilities.

    It was discovered that several banks have created platforms to educate clients on the process of converting dollar deposits into naira from their domiciliary accounts.

    Several banks informed their clients via SMS that holders of domiciliary accounts could  convert US dollars to naira via their online banking platform.

    The SMS read: “It is as instant as a regular transfer between accounts. The service is available between 9 am to 4 pm Mondays to Fridays, excluding public holidays.

    “Customers are expected to log into their internet banking platform, go to the FX transaction portal and select FX sales.”

    The transaction rate was fixed at N1,450 to the dollar, notwithstanding the bank’s assurances that the rate is competitive. The rate was less than the N1, 510/$ exchange rate that was available on the black market the previous day.

    The banks also pegged the daily transaction  at $50,000.

    A staff member of the apex bank, who pleaded anonymity, who confirmed the development said: “Yes, it is true that banks may contact customers who have domiciliary accounts and recommend converting their foreign currency to naira.

    “However, it is important to note that this is not a mandatory directive from the Central Bank of Nigeria (CBN). Rather, it is simply a service being offered by the banks.”

    An official at one of the commercial banks, who also preferred anonymity, said: “We will not be the one to initiate that move but if we have customers who may have inflows and want to sell, what we will do is to tell the customer to write an instruction that I have so and so amount inflow, please sell at the prevailing rate.”

    To enhance the flow of remittances into the country, CBN has issued some guidelines and rules since 2014. However, in November 2020, it declared that remittances would only be paid out in dollars, temporarily halting the regime of naira payouts.

    By requiring payouts in dollars, the 2020 policies ensured that remittances were routed through official channels, such as authorised banks. In addition, the policies improved foreign exchange liquidity in the parallel market and forced International Money Transfer Operators (IMTOs) to bring foreign exchange directly into the country. These goals aimed to improve the CBN’s visibility of remittance flows.

    Remittance stakeholders reported varying effects from the dollar payout policy, according to a survey at the time by Stears, a market intelligence company for investing in Africa that provides macro insights and analytics to global organisations investing and operating in the continent.

    Authorised bank stakeholders reported few changes, but noted they often struggled to find dollars to distribute to remittance recipients. While traditional IMTOs reported little business disruption because they depended on their reputation, extensive agent networks, and bank relationships to guarantee payouts.

    Fintech and digital IMTOs that were surveyed fared worse. Some incurred increased costs as a result of the 2020 policy since they had to change their business models and collaborate with banks to guarantee dollar payouts to their consumers. Others, notably mobile money providers, were shut out of the market by the directive since their wallets were unable to process dollar payments.

    It was established that customers experienced increased difficulty receiving their remittances following the policy’s reintroduction. Customers favoured unofficial techniques due to their lower risk and higher exchange rates.

    The Tinubu-led administration acknowledged these difficulties earlier in July, last year and gave customers the freedom to choose whether to receive remittance payouts in dollars or naira.

    The implications of reintroducing naira payouts, according to analysts in Stears, include

    Significantly, this policy comes against the backdrop of the CBN’s move to unify the parallel and official exchange rates. This lowers the incentives and profitability of IMTOs who were alleged to have benefited from arbitrage opportunities.

    The unification of the exchange rates should motivate more consumers to avoid the fraud risks associated with informal remittance channels in favour of formal routes. This should increase the volumes flowing through IMTOs and banks.

    How IMTOs can work better

    The inclusion of licenced IMTOs in the Investor & Exporter (I&E) window should improve FX liquidity and transparency for the CBN. This should motivate the apex bank to ease restrictive policies on the IMTOs over which it now has better oversight.

    The return to naira payouts should reduce costs for IMTOs who may no longer need to partner with multiple banks.

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    Mobile money operators and other fintechs who previously exited the sector are expected to return. This will depend on their ability to obtain an IMTO licence or partner with licensed IMTOs. We expect that foreign players who left will watch the market closely for the next few months before making a decision.

    Altogether, the policy is a positive step for both businesses and consumers. A combination of higher competition, more favourable exchange rates, and naira payout should lower the cost for consumers and increase the prospects of higher remittances to Nigeria in the medium term.

    An expert reacts

    Speaking on the policy, a business/policy analyst, Tosin Arthur, welcomed the idea in the interim but expressed some reservations about it.

    He said: “It’s a welcome development but the banks should also make it possible for customers to buy dollars through their online banking channels.

    “I have also observed that some banks are not being sincere with the prevailing rate to buy the dollar from customers. There is one I know that has been offering N1,100 for weeks while others continue to adjust to reflect the prevailing rate. If they want customers to patronise them, they have to be honest and transparent.’’

    Remittances to Nigeria may be impacted, according to Arthur, who added that the CBN may have taken this action only to hold onto dollars.

    He maintains that this is a provisional action because the CBN and DMBs want to keep them out of the public eye for various reasons, including health issues, exports, and overseas education. However, he said the apex bank needs to strike a balance so that purchasing dollars is easy for the common Nigerian.

    “The logic behind this is not quite clear. Although this is not the first time the CBN has adopted this measure which I believe is tentative, I think it will most likely affect remittances to Nigeria except the banks are offering the prevailing rate.

    “It also seems that the CBN and banks just want to hold on to the dollars and not make any available to the public who need it for different reasons from medicine to export to studying abroad.

    “It’s a lot of process, documentation, and time for an average person to access the dollar at an official rate through the banks now while it is seamless for them to get the dollar from you and give you naira. The CBN has to find a balance. Make buying dollars seamless for the average Nigerian just the way it is to get the dollar from them. As I said earlier, it will most likely be a short-lived policy. It’s not a new one, just reintroduced.”

    Another, Media and Communications Officer, Jeremiah Otu, was among those who expressed optimism on the policy, pointing out that it’s a positive move.

    “The policy seems to be based on global best practices. In Britain, for instance, if you receive dollars from abroad in your bank account, the bank will almost automatically convert it to and pay you the pound equivalent, because the dollar is not legal tender in the United Kingdom.

    “There are exceptions, of course, but that is the standard practice in the UK and most of the Western world. Everyone does what they can to protect their currency. We should too. Yes, the policy will cause some problems, so there should be exceptions,” he said.

    Otu recommended that services rendered in Nigeria that are paid for using US dollars should be outlawed by the government.

    “For instance, we must stop private schools or services in Nigeria from collecting fees in dollars. Foreign NGOs and firms must pay their workers in naira. Our economy has become too dollarised.

    “That said, our biggest problem is not even the policy, rather it is the government.The policy will affect the rich, including politically exposed persons, bankers, and other high net-worth individuals in government or who have friends in the government more than it will affect the poor, so they will do all they can to frustrate it. Does the government have the willpower to see the reforms through? I think not,” he added.

    A lawyer, Chibuzor Paul, explained that he owned a domiciliary account and could withdraw from it. Likewise, he suggested, he might transfer funds to another Nigerian domiciliary account.

    He is unable to determine, however, if he would be able to move funds outside of Nigeria or receive payment in dollars in the event that he receives money from elsewhere.

    “There was a programme that CBN had, if someone sends me up to $1000 from abroad, I get N5,000 incentive on top of the money. But I don’t know whether that programme is still available in light of all these confusing messages from CBN almost every day.

    “I’ve not been sent money from abroad recently. But I’m sure the initiative by CBN is a bad idea because CBN and banks will never pay you the correct market value of the Naira equivalent of the FX.”

    Further justifying his stance, the lawyer added: “Most times when I ask banks how much they’ll change dollars for me, they give me a very ridiculously low rate. But an aboki man sitting in the bank and watching me collect the dollars, will corner me at the door of the same bank and offer me a mouth-watering rate. If you were me, which would you go for?

    “The CBN should retain that policy of N5,000 incentive for every $1,000 received from abroad. I’m, however, convinced that CBN/banks will NEVER pay you the actual market value of the Dollars equivalent”, he added.

  • How tobacco industry circumvents regulations

    How tobacco industry circumvents regulations

    Nigeria records no fewer than 26,800 tobacco-related deaths annually. To make matters worse, the latest Tobacco Industry Interference Index shows that the tobacco industry has found and is exploiting weaknesses in the National Tobacco Control (NTC) Regulations 2019 to interfere in tobacco control  at the risk of public health and government revenue. CHINYERE OKOROAFOR reports

    Patrick Ngoka has been a chain smoker for over 25 years, even though he does not consider himself a cigarette addict. “I used to be a very heavy smoker, but I don’t smoke as much anymore. These days, I only smoke every December whenever I visit my village for the Yuletide. I may take two or more packs of cigarettes daily during this period.”

    Despite knowing the dangers of smoking, Patrick isn’t easily deterred. He has felt the impact on his health, especially when heavy smoking triggers coughing and chest issues. He admits it’s a bad habit and hopes to quit someday. “Sometimes when I smoke very heavily, it affects my chest and I begin to cough. So, I know it is a bad habit. I hope to stop someday though,” Patrick said.

    Patrick’s story sheds light on the struggle of breaking free from a cigarette addiction. According to the United States Food and Drug Administration (FADA), cigarettes, e-cigarettes and other tobacco products are so hard to quit because they contain nicotine, a highly addictive chemical that keeps people using tobacco products, even when they want to stop. Millions of other Nigerians are in that trap. A 2019 study titled “Current Prevalence Pattern of Tobacco Smoking in Nigeria: A Systematic Review and Meta-analysis” estimated that “one out of 10 Nigerians still smokes daily.”

    Tough laws against tobacco entities

    Alarmingly, the tobacco industry – despite Nigeria’s enactment of tough regulations and campaigners’ efforts–is finding new ways to ensnare non-smokers. Some of the regulations are Nigeria’s National Tobacco Control (NTC) Act, which was signed into law on June 10, 2015, covers several areas of tobacco control, including regulation of smoking, the prohibition of tobacco advertising, promotion and sponsorship, regulation of tobacco products, contents and product packaging, licensing and protection from tobacco industry interference, among others.

    Regulations for implementing the Act which came four years after and is now known as the National Tobacco Control (NTC) Regulations 2019 gave more clarity on stakeholders’ obligations for effective tobacco control. Nigeria is also a signatory to the World Health Organisation Framework Convention on Tobacco Control (WHO FCTC) which came into force on January 18, 2006.

    Tobacco Industry

    Interference Index 2023

    Notwithstanding tough anti-smoking laws, the tobacco industry is exploiting loopholes to undermine efforts to check the problem. Some of its tricks were exposed last November in the Tobacco Industry Interference Index 2023, published by Pan-African transparency watchdog Corporate Accountability and Public Participation Africa (CAPPA) with support from Bloomberg Philanthropies through the Centre for Good Governance.

    “While Nigeria’s National Tobacco Control Act and its regulations have largely checked the activities of tobacco corporations and entities, the industry has exploited some weaknesses in these laws and gaps in the system to interfere in tobacco control,” said CAPPA’s Executive Director, Akinbode Oluwafemi at the launch of the report in Lagos. One such tactic, Akinbode noted, “is the tobacco industry’s use and loud celebration of its corporate social responsibility (CSR) activities in the media and on social platforms as a way of enhancing its image to attract unsuspecting individuals, thereby creating a perception of the industry and its products as responsible and desirable. These CSR initiatives are further promoted by the endorsement of state authorities, who associate and collaborate with the industry to execute socio-economic empowerment programmes.”

    The report, the third in the series, shows a marked deterioration in Nigeria’s rating from 53 points in 2021 to 60 in the period under review. It noted that the main deterioration was the government’s failure to adhere to transparency mechanisms, especially relating to demands it is supposed to make of the industry or disclosure of exchanges with the industry as mandated by the National Tobacco Control Act 2015 and the National Tobacco Control Regulations 2019.

    These breaches are exploited maximally by the industry to interfere in public health policy. This report x-rays industry interference in policy development in Nigeria, their misleading CSR activities, benefits the tobacco industry enjoys, unnecessary interactions between the industry and public officials, transparency mechanisms in government dealings with the industry that are not strictly adhered to, conflict of interest and preventive measures, among others. The report reinforces the importance of parties adhering to the WHO FCTC guidelines which requested parties to protect their tobacco control policies from commercial and other vested interests of the tobacco industry (Article 5.3).

    Tobacco industry tricks

     According to the report, the main deterioration in tobacco industry interference in 2023 is manifest in the Nigerian government’s challenges and failure to adhere to transparency mechanisms, and disclosure of exchanges with the industry as mandated by the National Tobacco Control Act 2015 and the National Tobacco Control Regulations 2019. These breaches, the report noted, are exploited maximally by the tobacco industry to interfere in public health policies and deliberations. The report also flagged other areas of concern which include “the unnecessary and unhealthy interaction between the tobacco industry and public officials, mostly in the agriculture sector where top government officials have been documented in several instances, participating in the industry’s activities and openly lauding them; the tobacco industry celebrates its CSR activities in the mainstream and social media platforms as a way of enhancing its image to attract unsuspecting individuals; thereby creating a perception of the industry and its products as responsible and desirable. These CSR initiatives are further promoted by the endorsement of state authorities, who associate and collaborate with the industry to execute socio-economic empowerment programmes.

    “The weak enforcement of preventive measures, including ambiguities in the National Tobacco Control Act (NTCA) 2015, and its regulations of 2019 inadvertently allows the tobacco industry to operate without accountability in certain instances. For instance, while the NTCA mandates the tobacco industry to submit annual reports on tobacco and tobacco products, it also retains that the minister may choose to either disclose or withhold this information from the public. This optional transparency makes it difficult for public health advocates to verify whether compliance is being enforced or not.

    “The industry’s continued participation in policy development in Nigeria such as its enjoyment of invitations from the government inter-agency bodies and agencies to meetings where classified resolutions on public health are reached.”

     The human cost of

    tobacco smoke

     No fewer than 26,800 tobacco-related deaths are recorded annually in Nigeria, the Federal Government revealed in May last year. The National Coordinator, Non-Communicable Diseases Division of the Federal Ministry of Health, Dolapo Sanni, who spoke in Abuja at the launch of a research report on tobacco taxation and health financing in Nigeria, described the tobacco epidemic as one the biggest public health threats the world has ever faced.

    The research, conducted by the Civil Society Legislative Advocacy Centre and Tax Justice Network Africa, was titled ‘Tobacco Taxation and Health Financing in Nigeria Beyond COVID-19 Era.” The findings largely corroborate a 2021 study by the Centre for the Study of Economies of Africa (CSEA) which put the annual deaths at 28,876. CSEA’s research further found that smoking-related ailments burden the Nigerian healthcare system with a direct annual treatment cost of N526.45 billion, which was equivalent to 0.36 per cent of the Nigerian GDP in 2019, and 9.63 per cent of the country’s annual healthcare spending.’

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    Chronic obstructive pulmonary disease (COPD) was the top cause of smoking-attributable mortality, followed by ischemic heart disease, stroke, passive smoking, lower respiratory tract infection, and cardiovascular deaths of non-ischemic cause. Adding up productivity losses due to illness, early deaths and informal caregivers, tobacco-related diseases represented 0.44 per cent of the GDP in 2019, according to the study. A study on the estimated benefits of increasing cigarette prices through taxation on the burden of disease published in 2022 in the PLOS ONE journal, found that tobacco’s total economic burden accounts for ₦634 billion annu ally, considering direct treatment costs, productivity losses (due to early mortality and disability) and informal caregiving cost.

    It added that in Nigeria, the tax revenue generated by the sale of cigarettes (and other tobacco products) was around ₦36 billion in 2019, which covered only 6.9 per cent of the direct medical costs of smoking, or 5.7 per cent of the total financial burden.

    Way out of the problem

    To address tobacco industry interference challenges, the report urged the Federal Government to implement fully the National Tobacco Control Regulations 2019, and also review ambiguities in the law so that they do not provide revolving doors that the tobacco industry can exploit to interfere in public health and other government policies. “The Nigerian government must work to ensure that public officials in relevant ministries, departments and agencies sign conflict-of-interest forms periodically to remind them of commitments or obligations that may compromise their office and operations,” said Zikora Ibeh, Policy and Research Officer of CAPPA.

    Additionally, the report also urged state authorities to build inter-governmental synergy at all levels by establishing clear protocols for the full disclosures of minutes and proceedings from meetings and interactions with the tobacco industry. To begin, it advised relevant ministries, departments and agencies (MDAs) to consistently update their websites and other information platforms to facilitate the easy dissemination of information and engender transparency.

  • Worsening power crisis ignites push for Electricity Act 2023 implementation

    Worsening power crisis ignites push for Electricity Act 2023 implementation

    Despite priding herself as Africa’s largest economy and having the highest population estimated at 213 million as of 2022, Nigeria’s power generation capacity still hovers around 3,134 and 3,814.68 megawatts (MW). This translates to a significant shortfall of about 16, 866MW from the 2030 target of 20, 000MW, resulting in yearly economic losses to poor electricity supply estimated at $28 billion, about N10 trillion. With about $100 billion said to be the investment required over a decade to address the nation’s power challenges, experts and real sector operators say that the Electricity Act 2023, if robustly implemented, holds prospects of addressing the challenges and breaking the jinx in the power sector. Assistant Editors CHIKODI OKEREOCHA and MUYIWA LUCAS report.

    No one envy Power Minister Chief Adebayo Adelabu. The burden he carries on his shoulders—overseeing a ministry widely acknowledged as pivotal to the actualization of the President Bola Tinubu administration’s Renewed Hope agenda—has become too heavy to bear. Though an inherited burden, the intractable crisis in the Nigerian Electricity Supply Industry (NESI) manifesting in the shortage of electricity to power the current administration’s economic recovery agenda has put the Minister in the eye of the storm.
    This has been particularly so in the last few weeks, perhaps months, since the nation’s power generation dropped to an embarrassingly low level of 3,134 megawatts (MW). Besides, this year alone, the national power grid has collapsed twice and in one instance, to zero MW, plunging most electricity consumers across the country into near total blackout. Although Adelabu sought, albeit unsuccessfully, to pin the blame on gas supply glitches, it was doubtful if any Nigerian was swayed by his explanations.

    In one of such embarrassing drops in power generation, the Minister, through his Special Adviser, Strategic Communication & Media Relations, Mr. Tunji Bolaji, explained that gas supply problems were responsible for the nation’s power sector woes. He, however, assured Nigerians that the Federal Government will end the blackout, pointing out, for instance, that government was making efforts to ensure payment of all outstanding debts to Electricity Generation Companies (GenCos).

    Adelabu said this was with a view to enabling Electricity Distribution Companies (DisCos) supply more electricity to Nigerians. “In the past couple of weeks, there has been a significant downturn in the level of power supply to Nigerians. This is mainly due to a decreased level of gas supply to GenCos. This situation has led to a lower level of energy supplied to load centres, which has affected supply of electricity to DisCos,” the statement by Bolaji quoted the Minister as saying.

    Chief Adelabu said government acknowledges that the current situation is unsustainable and it expects a turnaround immediately, adding that the problem in the sector has adversely affected production, leading to blackout in some parts of the country. Sadly, however, not a few Nigerians refused to be convinced by his explanations. Many of them were quick to observe the lack of a timeline for the “expected turnaround” in the troubled power sector. For instanmce.

    More importantly, many electricity consumers could not fathom how, despite being the largest economy and having the highest population on the continent, estimated at 213 million as of 2022, Nigeria’s electricity generation capacity still hovers between 3,134MW and 3,814.68 MW, leaving South Africa and Egypt leading on the continent as the countries with the highest electricity generation capacity.

    For instance, while the Rainbow Nation (South Africa), boasts domestic power generation capacity of 58, 095 (MW) from all sources, Egypt has installed electricity generation capacity of 58, 818MW as of September 2023. Experts at professional services firm, PricewaterhouseCoopers (PwC Nigeria), brought the depressing disparity nearer home, noting that Nigeria’s electricity generation per capita was 147 kilowatts per hour (kWh) in 2022.

    PwC, in its latest Nigeria Economic Outlook, highlighting the seven key trends that will shape the nation’s economic trajectory in 2024, said Nigeria’s 147kWh electricity generation per capita is lower than the figures for the other four largest economies in Africa. The report said South Africa’s electricity generation per capita was 3,566 kWh, while Algeria’s was 2,041 kWh. Egypt’s stood at 1,875 kWh, while. Morocco was 1,099 kWh.

    To address these disparities that have become a national embarrassment, Adelabu had, after a recent meeting with electricity generation and distribution companies announced the prioritization of gas supply issues. “During our meeting, we also addressed the indebtedness to GenCos by Nigeria Bulk Electricity Trading Company (NBET). While acknowledging the sector’s liquidity challenge, we are working on validating the debt and determining a fair resolution,” he said, on his verified ‘X’ handle, formerly Twitter.

    The Minister added that a plan has also been drawn out to initiate discussions with the Minister of State for Petroleum Resources regarding collaboration and to emphasize to the Ministry the importance of prioritizing gas to power. “Our commitment is unwavering in addressing the challenges affecting power supply… our goal is to swiftly resolve the issues of gas supply, indebtedness, and overall sector stability. Your patience is appreciated as we work collaboratively towards a brighter, more reliable energy future for Nigeria,” Adelabu said.

    Yet, for many Nigerians, there is no reason why the country should be having power problem. “In power, there are three levels. There is generation, transmission and distribution. The government decided they were going to hold on to transmission and that is why we are having the problems we are having and the truth is the transmission infrastructure is over 40 years old,” argued the Chief Executive Officer, CommonSense Group, Dr. Olumide Emmanuel.

    Emmanuel, who is also a wealth creation coach, argued that while the government may be weary of totally handing over the entire transmission to the private sector for fear of sabotage, some of the agreements signed between GenCos and the other members of the value chain were faulty. According to him, they were an added burden to consumers of the commodity.

    “So you sign with the GenCos that whatever power they generate will be taken up and paid for. Right now, the GenCos are generating more power than we can transmit. So, you are paying for a power you are not using. You are generating 8,000MW while our grid can only carry 3,800MW or 4,000MW, implying that we are paying for 4,000MW that we are not using.

    “And because you have generated 8,000MW but only sending 4,000MW, the people on the other side will be paying for the unused 4000MW because you have to pay the GenCos for the 8,000MW they have generated,’ Emmanuel explained.

    He further added that: “Everybody in Nigeria today is complaining about the electricity supply and they all have generators. Is it not better that we let go of the noise and pay for the electricity? We are complaining that they are increasing the tariffs. No, they did not increase it, there was something signed- the Multi Year Tariff Order (MYTO). The situation was that every six months, it will be increased. It has been signed years ago. They are only following what they have signed.”

    OPS, experts calls for implementation of Electricity Act 2023

    It remains unclear how Adelabu’s envisaged “reliable energy future for Nigeria” based on the prioritization of gas supply and the resolution of the sector’s indebtedness will close Nigeria’s huge power infrastructure gap. This is so considering that available generation capacity declined by three per cent from 4,341.87 MW in Q3 2022 to 4,211.44MW in Q3 2023, leaving a significant shortfall from the 2030 target of 20,000MW, according to PwC.

    Therefore, for the professional services firm and indeed, other critical stakeholders, including manufacturers, industry experts, managers of the troubled NESI, and Nigerians generally, the implementation of the Electricity Act 2023 (the Electricity Act [Amendment} Bill, 2024 was signed into law on Friday, February 9, 2024) is the game-changer.

    To them, the Electricity Act 2023, which devolved powers to the sub-nationals (States) to enact their own electricity laws across the value chain of generation, transmission, distribution, trading, and regulation within the confines of States, is the tonic to close the nation’s huge energy deficit forced by age-long challenges in the power sector.

    Recall that President Bola Tinubu signed the Electricity Act 2023 on June 9, last year. This was sequel to the Fifth Alteration to the 1999 Constitution (as amended) signed during the last days of his predecessor, Muhammadu Buhari.

    The Electricity Act 2023, which replaced the Electricity and Power Sector Reforms Act 2005, was aimed at providing an all-inclusive framework that will serve as a guide to the decentralization of the power sector in order to encourage private investment and build a competitive electricity market.

    The icing on the cake of the new Act is the Electricity Act (Amendment) Bill, 2024, which seeks to address the development and environmental concerns of host communities. It sets aside five (5) per cent of the actual annual operating expenditures of GenCos) from the preceding year for the development of their respective host communities.

    The Bill further provides that the funds set aside for the development of host communities will be received, managed, and administered for infrastructure development in the host communities by a reputable Trustee/Manager to be jointly appointed by the respective GenCo and their host community.

    The signing of the Electricity Act 2023 sure gladdened the hearts of experts, private sector operators, particularly manufacturers, and Nigerians generally. “It’s a major step in the right direction,” the Director General of Manufacturers Association of Nigeria (MAN), Mr. Segun Ajayi-Kadir, said.

    According to him, the move, which came in the aftermath of the removal of fuel subsidy, was “Another reflection of the boldness and commitment of the new administration towards the diversification and decentralization of the power sector.”

    Making a case for the implementation of the new Act, the MAN DG recalled that over the past decades, the Nigerian power sector has encountered much turbulence in its electricity value chain due to poor policy enforcement, over-regulation, instability of gas supply and bottlenecks in its transmission network.

    These problems, according to him, have culminated into erratic electricity supply, frequent power outages and persistent collapse of the national grid, adding that for many years, this situation has stunted the growth of the economy.

    Ajayi-Kadir, however, expressed optimism that “The empowerment of the State Governments and private investors, the adoption of renewable energy and the reformation of the governance structure of the power sector are capable of driving investment, improving electricity access and fostering economic growth.”

    He said in light of the huge energy deficit occasioned by the age-long challenges in the power sector, President Tinubu set the ball rolling by signing the Electricity Act 2023 which is meant to be “a game changer to address the numerous constraints within the sector.”

    For Ajayi-Kadir and indeed, other critical stakeholders in the economy, the capacity of the Electricity Act, if well implemented, to change the dynamics in the troubled power sector is not in doubt. For instance, the MAN boss noted that the current power supply is inadequate to satisfy the energy requirements of the manufacturing sector and the entire population.

    He, therefore, stated that the new Act has implication for the manufacturing sector, as it will reduce cost of alternative energy and also usher a regime of competitive and lower electricity tariff.

    He listed other expected positive deliverables from the dynamic implementation of the Electricity Act to include improvement in inflow of Foreign Direct Investment (FDI) and manufacturing performance, increase in Internally generated Revenue (IGR), improved infrastructure and less tax burden on manufacturers, more investment in renewables, backward integration and energy security, and stable power supply and proper planning

    For a start, Ajayi-Kadir said the Electricity Act holds promises of reducing drastically the cost of alternative energy for manufacturers, which currently stands at over 40 per cent. “We expect this to boost our profit margin,” he said, adding that the new Act will also help actualize a cost –reflective tariff considering the healthy price competition it will bring between the states and private investors.

    According to him, MAN, as an advocacy Association, has always pushed for the need to charge cost-reflective electricity tariff to avoid extortion of its members. He also said on the strength of the new Act, an improvement in inflow of FDI and manufacturing performance is in the offing.

    While pointing out that the country’s epileptic power supply is one of the prominent reasons for the relocation of some manufacturers, Ajayi-Kadir said he is quite optimistic that provided the new Act is implemented, “It will encourage the inflow of manufacturing FDI, boost the performance of the sector and increase the sectoral contribution to the economy.”

    The possibility of an increase in IGR, improved infrastructure and educed tax burden on manufacturers is also high. According to Ajayi-Kadir, Nigeria’s electricity market is one of the biggest in the world because of its massive population and growing demand for energy by households and businesses.

    “Therefore, the amount of IGR that each state stands to accrue from the decentralization of the power sector is delightful. If properly utilized, such huge revenue can bridge the infrastructure deficits in many states without imposing further tax burden on manufacturers,” he said.

    That’s not all. The new Act, which seeks to open greater investment opportunities in renewable energy, has also forced MAN to intensify its advocacy in favour of its diligent implementation. This is because for manufacturers, investment in renewables like solar will not only promote cleaner climatic environment but ensure that energy consumption is cost efficient. “The cost savings will directly improve profit margin and promote further manufacturing investments,” Ajayi-Kadir emphasized.

    He also stated that energy is the most vital input of manufacturers. Accordingly, the empowerment of private manufacturing companies to generate their own electricity, the MAN DG said, will unleash massive investment in backward integration activities which will no doubt be a major enabler of energy security within the sector. He also said the new Act will guarantee stable power supply and proper planning.

    Justifying this expectation, Ajayi-Kadir stated: “The epileptic power supply often destabilizes daily business plans of many of our small and medium sized members that cannot afford or maintain alternative sources of energy. A distorted business plan can be highly detrimental for manufacturing operations.

    “Apart from causing sub-optimal capacity utilization, the amount of wastage can be highly unbearable. The new Act, if fully implemented, can re-write the story by stabilizing the supply of electricity to infant manufactures and aid their planning for optimal delivery.”

    ‘Act expected to curb 28b (N10tr) annual economic losses’

    Manufacturers are not the only economic actors pushing for the implementation of the new Act to breathe life into the nation’s beleaguered power sector and unleash the potential of various sectors of the economy. PwC Nigeria also weighed in on the issue, pointing out, for instance, that “If implemented by the States, the Electricity Act 2023 is expected to minimise the annual economic losses estimated at $28 billion (N10 trillion).”

    PwC also said the new Act, which grants constitutional authority to States to enact laws for generation, distribution, and transmission of electricity within their boundaries, including territories formerly covered only by the national grid, will enhance electricity access to the 85 million Nigerians that lack access to the electricity grid in the various unserved and underserved areas.

    PwC, in its report released penultimate week and made available to The Nation, painted a distressing picture of the NESI, noting, for instance, that despite the targeted 30GW supply by 2030, electricity supplied has never gone beyond 6GW, and this implies that not much progress has been made since the target was set.

    “This huge gap is due to deteriorating plants/units’ capacities, poor maintenance due to liquidity challenge and access to forex (foreign exchange), non-binding contracts and delayed payment, inadequate gas supply, transmission constraints, limited distribution network and commercial viability of DisCos operation,” the report said.

    It also aid despite the growth in the number of metered customers, which grew by 10.4 per cent to 5.47 million metered customers in Q2 2023 from 4.96 million metered customers in Q2 2022, the ratio of metered customers to registered customers population remains low at 50.6 per cent due to insufficient funding.

    With Nigeria’s electricity generation capacity currently hovering between 3,134MW and 3,814.68 MW, PwC, in the report authored by its Partner and West Africa Lead, Olusegun Zaccheaus; Lead Economist and Researcher, Omomia Omosomi; and Senior Economist & Researcher, Adesola Borokini, said “Such a disparity has a negative impact on growth and productivity.’’

    The professional services firm stated that $100 billion is the estimated investment required over a decade to address the nation’s power challenges. And one of the visible challenges is the fact that at moment, Nigeria holds the unviable record as the country with the largest energy access deficit in the world.

    Indeed, according to the 2021 report by the International Energy Agency (IEA), Nigeria’s 86 million is the largest number of people in the world without access to electricity. Access to electricity has remained a hurdle for millions of Nigerians. And shortage of electricity supply has been identified as a hindrance to the profitability of manufacturers and indeed, other operators in the economy.

    The N10 trillion annual economic losses PwC and manufacturers estimated to be lost to shortage of electricity supply is equivalent to two per cent share of Nigeria’s Gross Domestic Product (GDP). This unfavourable situation, according to Ajayi-Kadir, has positioned the country among the worst countries to do business with a rank of 171 out of 190.

    “Notwithstanding, the Electricity Act 2023, if well implemented, promises to be a major game changer for the manufacturing sector,” the MAN DG reiterated.

    For the Act’s potential benefits to manifest

    One of the key highlights of the Electricity Act 2023 that has put operators and stakeholders in the electricity value chain in expectant mood is the fact that power generation licensees are obligated to meet renewable energy generation as prescribed by industry regulator Nigerian Electricity Regulatory Commission (NERC). NERC will only surrender regulatory responsibilities to states with established electricity market laws.

    Also, without a license but an undertaking, the Act empowers any private individual or company to generate not more than 1MW in aggregate at a location. Subject to NERC’s determination, private individuals or companies can sign an undertaking to distribute electricity of not more than 100 Kilowatts in aggregate at a location. The Act also prohibits interstate or transnational electricity distribution.

    Furthermore, GenCos are mandated to either generate or purchase electricity from renewable sources or procure instruments for generating renewable energy. Besides, the Act empowers legislative committees to carry out oversight function over the NESI. Except for Lagos, Kaduna and Edo with established electricity market laws, electricity in other states will still be regulated by NERC.

    However, manufacturers have put forward a number of recommendations, which, according to them, must be considered to avoid truncating the potential benefits of the Electricity Act. Ajayi-Kadir said, for instance, that tightening the nation’s security infrastructure has become a compelling proposition under the new Act, as “No investor wants to do business in a terrorized economy.”

    He also stressed the need to render legal, financial and technical supports to State Governments that are yet to establish electricity market laws. “State Governments should partner with existing agencies and operators in the power sector as the costs of building new power distribution networks can render the investment less lucrative,” he recommended, adding that there is need to streamline NERC and states’ regulations to avoid bottlenecks for multistate investors.

    The MAN DG also harped on the need to address the uneven distribution of gas to avoid delay in states’ execution of mega-power projects. He added that while states concentrate on small confined democratized power supply systems, there is need to have in the pipeline a long-term plan of ensuring operational efficiency of the national grid. Besides, the power sector, he said, is highly capital-intensive hence, there is need to reduce the lending rate to encourage private investments in mini-grids and renewable energy.

    With Ajayi-Kadir insisting that “The success of the new Act largely rests on its full effect and implementation” to further open up the power sector as intended and lead to better service delivery, it remains to be seen how Adelabu will galvanize relevant agencies under his ministry, particularly Nigerian Electricity Management Services Agency (NEMSA), which, under the Act, is the lead enforcer of technical and regulatory standards.

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    Interestingly, Adelabu is not unaware of the immense capacity of the Act to turn things around in the power sector, including the task ahead for him. At the recent 3rd Edition of Roundtable for Legislature, Judiciary and Stakeholders on the Enforcement of Technical Standards and Regulations in the Multi-Tier Nigerian Electricity Supply Industry (NESI) held in Abuja, he noted that the Electricity Act, 2023 has been heralded as a game-changer.

    The Roundtable was at the instance of NEMSA, with the Minister described it as an opportunity for stakeholders to compare notes on the reforms recently brought about in NESI by the amendment of the 1999 Constitution and the re-enactment of the Electricity Act, 2023. He said the reforms mean that all hands must be on deck, for it is one thing to create the enabling environment and another for the desired change for a better outcome.

    Adelabu noted that the Electricity Act, 2023 has consolidated virtually all legislations in the NESI and strengthened the role of NEMSA as the lead Enforcer of all statutory technical and regulatory standards in order to guarantee the safety of lives and property, with complementary roles assigned to other sister Agencies under their respective Acts.

    Perhaps, as sign that the diversification and decentralization of the power sector promised by the Electricity Act, 2023 is off to a good start, a number of states are said to have enacted their Electricity Acts. Some of the states, The Nation learnt, include Lagos, Edo, Kaduna, Oyo, Osun, Ondo, Ekiti, Ogun, and Enugu.

    The states, encouraged by the Act, which has altered the equation of the power sector in Nigeria, are said to have taken practical steps to make laws that will empower them to facilitate generation and distribution of electricity as well as provide the framework for operating in the sub-sector.

    The consensus is that if all the states of the federation throw their hats in the ring and diligently implement the Act, it will set the stage for a major transformation of the power sector to guarantee uninterrupted electricity supply to the manufacturing sector and indeed, other critical sectors of the economy and Nigerians in general.

  • How paddy supply glitches hurt rice processors, investors

    How paddy supply glitches hurt rice processors, investors

    Despite the presence of over 100 large-scale integrated rice processing facilities, Nigeria’s rice production, consumption and pricing outlook remain bleak. The country currently produces 5.4 million metric tonnes of rice but consumes almost seven million metric tonnes, resulting in an annual supply shortfall of approximately two million metric tonnes. Furthermore, the price of this staple has surged by over 37 per cent. Industry operators and investors attribute this predicament to supply-side constraints, specifically the challenges in accessing quality and affordable paddy, which hinder domestic production. In light of this, they advocate for substantial investments and policy interventions in the rice milling industry, DANIEL ESSIET reports.

    When the Federal Government, through the Central Bank of Nigeria (CBN), unveiled multi-billion naira funding support to bolster rice production throughout the nation’s rice value chain, 34-year-old Sadiq Falau was among those who breathed a sigh of relief. For Falau and other stakeholders in the agricultural industry, this funding support materialised through initiatives such as the Anchor Borrowers’ Programme (ABP), the Paddy  Aggregation Scheme (PAS), the Private Sector-Led Accelerated Agriculture Development Scheme, and the Real Sector Support Facility, among others, proving to be a crucial boost for their endeavours.

     For the 34-year-old rice processor and investor, Sadiq Falau, the Paddy Aggregation Scheme proved to be a significant boon. This scheme, designed to offer credit facilities to integrated rice millers and large-scale aggregators at a single-digit interest rate, aimed to enhance local rice production and support the Federal Government’s National Food Security Programme (NFSP). Without hesitation, Falau seized the opportunity and invested in the rice milling sector. He constructed a N2.5 billion rice production and processing facility in Kaduna, with the intention of utilising the scheme and his substantial facility to establish a thriving business in rice production and processing. His aspiration was not only personal success but also to serve as an inspiration for other Nigerian youth, demonstrating that a promising future in agriculture is indeed attainable.

    While the Scheme did contribute to some positive outcomes, it did not fully meet its intended objectives. Notably, the Paddy Aggregation Scheme led to a substantial rise in the number of large-scale integrated rice processing facilities in Nigeria. Andy Ekwelem, the Director General of the Rice Processors Association of Nigeria, affirmed that “Nigeria boasts over 100 large-scale integrated rice processing facilities” due to the impact of the Paddy Aggregation Scheme.

    Despite the significant increase in the number of rice processing facilities, the anticipated benefits of this surge do not seem to be materialising. Investors like Falau, along with smallholder rice farmers nationwide, are facing challenges related to paddy collection, a critical aspect of the rice milling industry. Reports indicate that supply-side constraints, specifically the difficulty in obtaining quality and affordable paddy for smallholder rice farmers, are hampering domestic rice production. This situation not only affects Nigeria’s standing in global rice trade but also impacts the production, consumption, and pricing dynamics of the commodity within the country.

     The challenges in paddy collection have significant repercussions, as evidenced by Nigeria’s rice production and consumption dynamics. Despite producing 5.4 million metric tonnes of rice in the previous year, the country consumes almost seven million metric tonnes, resulting in an annual supply shortfall of about two million metric tonnes. This disparity has contributed to a price surge of over 37 per cent. Compounding the issue, reduced production in 2022, attributed to flooding during the wet season, has necessitated importing to bridge the gap. The U.S. Department of Agriculture (USDA) projects Nigeria’s rice imports to reach 2.1 million metric tonnes in the coming year, potentially making the country the top global rice buyer. The USDA report underscores Nigeria’s challenges in meeting domestic demand, with global rice trade expected to reach 52.85 million tonnes, featuring increased exports from Brazil and South Korea and heightened imports from Burkina Faso, Indonesia, and Nigeria.

    Even with a potential surge in rice productivity, the Commissioner for Agriculture in Lagos, Ms. Abisola Olusanya, underscores that Nigeria’s rice sector will grapple with sustained pressure due to the substantial demand from the country’s growing population. Rice, being a staple in Nigeria, holds a pivotal position in household diets and budgets, influencing demand, supply, and pricing dynamics.

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     Ms Olusanya highlights that Lagos alone consumes 40 million bags of rice annually, surpassing the consumption of Senegal, where an estimated 1.5 million tonnes are consumed per year. The per capita rice consumption in Senegal stands at 85kg annually, according to the International Food Policy Research Institute (IFPRI). Recognising the need to bolster supply, the Commissioner advocates for concerted efforts to increase yields, emphasizing the Lagos State Government’s commitment to enhancing agricultural productivity with a focus on achieving rice self-sufficiency.

    Despite the ongoing efforts to enhance agricultural productivity, particularly in the rice sub-sector, the anticipated results remain elusive, primarily due to various challenges. One significant obstacle is the disruption in the supply of paddy. The Special Adviser to the Lagos State Governor on Agriculture, Dr. Oluwarotimi Omotola Fashola, acknowledges that rice millers confront issues related to the quality and quantity of available paddy. Dr. Fashola emphasises that achieving good-quality milled rice necessitates paddy with proper moisture content and devoid of impurities. He explains that processing a kilogram of paddy typically yields approximately 62.5 percent rice, 20.70 percent paddy husk, 5.88 percent rice bran, and 3.72 percent broken rice. To optimise these outcomes, Dr. Fashola suggests that high milling capacity, coupled with advanced technology for raw paddy processing, including husk and bran removal, is essential. This ensures the production of well-milled white rice kernels, free of impurities and containing fewer broken grains.

    The Lagos Rice Mill located in Imota, Ikorodu, boasts an impressive processing capacity of 32 tonnes of paddy rice per hour. At its full operational capacity, the facility is designed to process 200,000 tonnes of paddy annually. Utilising advanced rice sorting technology, the milling facility employs high-resolution sensors to effectively separate unwanted solid materials, ensuring that the resulting rice grains are clear and of superior quality.

    Despite the technological advancements at the Imota facility, it has been observed that few private millers possess the capability to efficiently and seamlessly separate stones from grains. Additionally, some private millers lack access to a rice polisher, a crucial technology that cleans the surface of rice, significantly enhancing the overall quality of the finished products. Dr. Fashola emphasizes that the milling efficiency and quality of rice at the Imota facility are contingent on the use of paddy dried to a 15 percent moisture content.

    Achieving high-quality white rice involves a meticulous process, as outlined by Dr. Fashola. The steps include drying, cleaning, de-stoning, husk separation, paddy separation, whitening, grading, packing, and storage. While taking delivery of rice paddy may seem straightforward, the persistent challenge lies in dealing with long impurities present in the paddy. In many cases, millers need to utilize paddy cleaners to eliminate up to 80 percent of these long impurities, a task that is efficiently accomplished by pick-up cleaners.

    In less automated mills, manual labour is required to painstakingly pick out long impurities, a time-consuming process. Dr. Fashola stresses the critical importance of the pre-cleaning process, not only to prevent costly downtime but also to enhance the final quality of the rice. The rice milling industry faces multiple challenges, with poor-quality paddy and a shortage of paddy exacerbating the situation. Some mills are compelled to shut down during off-seasons due to the scarcity of paddy, further impacting the industry’s operations. Again, Fashola explained that Nigeria has one rice production cycle due to absence of irrigation. He, therefore, said more farmers will be motivated to increase the cultivated areas and seasonality if there are more government initiatives nationwide to support irrigation schemes.

    Agony of paddy farmers

    Paddy farmers are grappling with challenges as well. They typically sell their paddy directly to rice mills, but the stringent regulations imposed by mill owners on paddy procurement add significant pressure to the farmers. For instance, the regulations include concerns about potential discoloration of paddy due to heavy rains during the harvesting season, leading to potential rejection at mills for even slight discoloration or high humidity. The permissible limit for moisture content in the paddy crop for procurement is set at 15 per cent. With such strict regulations, milling facilities’ quality sections are obligated to reject paddy grains that exceed the permissible limit of moisture content, further complicating matters for paddy farmers.

    Managing paddy with high moisture content poses challenges for millers. When millers purchase rice paddy with elevated moisture levels, they are compelled to undertake the drying process themselves. After acquiring the paddy, millers invest time in classifying and grading the rice. This step is crucial in assessing the rice quality and determining the subsequent payment to farmers. Accepting paddy with excessive stones and sand is not only time-consuming but also unprofitable.

    Despite the soaring demand for rice, Fashola highlighted that supply-side limitations persistently impede domestic production, negatively affecting rice prices in local markets. The surge in rice prices is attributed to the high cost of processing, influenced by factors such as fuel and transport costs, exchange rate volatility, and seasonal variations. To boost domestic rice production and satisfy local demand, the President, Federation of Agricultural Commodity Association of Nig eria (FACAN), Dr. Victor Iyama, said the sector requires significant investments as well as policy actions by the government working with relevant stakeholders.

    Millers, processors hobbled by erratic electricity supply

    For the Managing Director, Kudehinbu Agric Enterprise, Adedotun Kudehinbu, inadequate electricity supply is incapacitating the efforts of rice millers/processors in the nation’s agro commodities segment of the agric industry. “I sincerely do not know how we intend to be productive without electricity,” Kudehinbu charged, insisting that, “Constant power supply is the panacea to most of our production issues in Nigeria and rice processors are not exempted.”

    He said further: “Imagine running a rice milling machine on diesel whenever you are processing simply because there’s no power supply or that it is erratic. Diesel is no longer cheap. I remember a time we were processing and they took the light, the milling machine jammed and we couldn’t resolve the issue for almost 24 hours. So, we had to call in the engineers to come in and fix the machine. In fact, if you don’t factor in the cost of diesel into your processing cost, you are not ready for the business. These are costs that if we had stable power supply, they shouldn’t even exist. In addition, erratic power supply sometimes damages these machines and the faulty parts have to be imported.”

    Kudehinbu lamented that considering the current exchange rates, buying these parts has become more expensive than they should be, adding that another challenge faced by rice processors is the issue of insecurity. “It (insecurity) is a scourge we must conquer. As a country, we are dependent on small holder farmers. They constitute 80 per cent of Nigerian farmers and they are the backbone of food production,” he told The Nation.

    The Kudehinbu Agric Enterprise boss insisted that it is absolutely wrong for this group of farmers to be getting killed on the farms. “This directly affects production as there will be fewer farmers on the farms planting and harvesting,” he said. He further pointed out that this will usually lead to scarcity, causing a direct impact on the cost of paddy, as there are too many buyers chasing very few quantities of paddy. “Nigeria must protect its farmers to achieve food security,” Kudehinbu emphasized.

    The concerns over insecurity in farms, decreased land dedicated to rice farming, inadequate supply of quality seeds, and the limited presence of high-performance machines among small-scale farmers are contributing to challenges in the rice production sector. Additionally, factors such as higher fertilizer prices and prolonged drought have further diminished production. Despite the rapid growth in population and the failure to enhance the value chain to reduce production costs, rice prices have surged. The current price of a 50 kg bag of rice stands at N60,000, reflecting the challenges faced by the sector. However, rice consumption in Nigeria continues to rise, and the country remains far from achieving self-sufficiency in rice production and consumption. According to the AFEX Wet Season Crop Production Report for 2023, Nigeria has spent over $15 billion in the past decade to meet the increasing demand for rice.

     Kudehinbu, who is involved in rice processing, agro commodities and fish farming, said he has been in the business of rice production and processing since 2019 and he has his rice brand, JDK Rice. “It’s been a sweet and sour experience for us as a company. We have faced numerous challenges in the Nigerian agricultural space which are mostly man made. These are challenges that are surmountable if as a country, we are committed to ensuring that we pay the right attention to agriculture while investing and developing our agricultural space,” he stated.

  • Lagos bolsters revenue oversight with cutting-edge audit training

    Lagos bolsters revenue oversight with cutting-edge audit training

    Every year, Nigeria suffers significant financial losses due to fraud and corruption, amounting to billions of naira. These losses manifest in various detrimental outcomes such as stalled projects, financial instability, organisational dysfunction, and even humanitarian crises. The root causes of fraud stem from inadequate controls and governance structures within organisations, which leave processes vulnerable to exploitation. Recognising the urgent need to address this issue, the Lagos State Government, in partnership with the Lagos State Office of Internal Audit and the University of Calgary’s Haskayne School of Business in Alberta, Canada, conducted a comprehensive five-day training programme recently for government officers focused on enhancing auditing practices. The objective of this initiative was clear: to fortify internal controls and combat revenue leakages, particularly in non-tax Internally Generated Revenue (IGR). CHINAKA OKORO reports.

    The threat of fraud and corruption poses a ubiquitous governance challenge that transcends the boundaries of organisations, irrespective of their size, industry, or geographical location. Experts in development consistently assert that corruption and inadequate governance significantly hinder the economic progress of any society. Year after year, the staggering toll of fraud and corruption becomes evident, with billions of naira lost to these nefarious activities. The consequences are far-reaching, encompassing inefficiencies, project failures, financial crises, organizational collapse, and in the most severe instances, humanitarian catastrophes.

    Corruption exerts a profound negative impact on economic growth, manifesting in dismal Gross Domestic Product (GDP) figures and inadequate infrastructural development. Additionally, it fosters the underutilisation of both natural and human resources, effectively stunting the advancement of societies and organisations alike. It’s crucial to recognize that corruption and the absence of reforms in the economic and public sectors are intrinsically linked, exacerbating the challenges faced by communities and institutions striving for progress.

    Fraud often thrives in environments where controls are poorly designed, and governance structures are weak, thereby undermining the integrity of an organisation’s processes. Establishing robust internal control procedures, coupled with an effective response plan, is indispensable in the fight against fraud and corruption. To safeguard against the detrimental impact of fraud on organisational development, it’s imperative for entities to implement stringent internal control mechanisms aimed at mitigating the risk of fraudulent activities. The pivotal role of internal audit in this regard cannot be overstated. Internal auditors play a critical role in ensuring that management has implemented effective systems to detect and prevent corrupt practices within the organisation. They meticulously examine financial statements to verify accuracy and identify errors or omissions. Additionally, they conduct comprehensive risk assessments for each department to align with overarching business objectives. Furthermore, internal auditors scrutinise inventory and expense reports to gauge the efficiency of the organisation’s operations.

    Recognising the significance of internal audit in bolstering governance and combating fraud, the Lagos State Government took proactive steps by organising a five-day training programme for its officers in auditing. The objective of this initiative was to enhance the capacity of government officials to conduct audits effectively, particularly in the realm of non-tax Internally Generated Revenue (IGR), with the ultimate goal of preventing revenue leakages. By investing in the professional development of its officers and prioritising the reinforcement of internal control mechanisms, the Lagos State Government demonstrates its commitment to fostering transparency, accountability, and efficient resource management. Such initiatives are pivotal in safeguarding public funds, promoting economic growth, and ensuring the sustainable development of the region.

    The training, conducted by the Lagos State Office of Internal Audit in collaboration with the University of Calgary’s Haskayne School of Business, Alberta, Canada, had a specific aim: to cultivate champions capable of auditing revenue collection processes comprehensively. From enumeration to billings and payments, the training sought to empower participants to scrutinize every stage of revenue generation meticulously. Moreover, the training had a broader objective of equipping the 25 internal auditors with the skills necessary to contribute to the realisation of Lagos State’s development goals. By focusing on non-taxable revenue collection, the programme aimed to elevate the current collection rate of 16% to an ambitious 40%. Achieving this target necessitates the effective oversight functions performed by trained auditors, ensuring accountability and efficiency in revenue management.

    Recognising the pivotal role of skilled auditors in driving revenue growth, Mrs. Oyeyemi Ayoola, the Special Adviser to the Governor on Internal Audit, emphasised the significance of the training. Addressing the participants, she clarified that the programme’s primary focus, in its initial phase, was to cultivate “Revenue Systems Auditor Champions.” These champions would possess the expertise to conduct daily audits of revenue collection processes, thereby strengthening the revenue system’s integrity and enhancing the state’s fiscal sustainability. “The training of internal auditors is part of the Lagos State’s continuous efforts at broadening the non-tax revenue base to enhance compliance, to generate enough revenue to meet the objectives of its THEMES PLUS Agenda, which include delivering infrastructure for the benefit of the residents. The state revenue collection process is automated and monitored through the software called Electronic Banking System of Revenue Collection Management (EBS-RCM).”

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    Mrs. Oyeyemi Ayoola reiterated that the primary emphasis of the training remains on non-taxable revenue. She stressed the importance of reassessing the existing system and subjecting it to the diligent oversight functions of internal auditors. The overarching goal is to elevate the performance of non-tax revenue processes from the current 18% to an ambitious 40%. By directing attention to non-taxable revenue streams, the Lagos State Government aims to optimise revenue collection mechanisms beyond traditional tax avenues. This strategic approach underscores the importance of diversifying revenue sources and maximizing income streams to enhance the state’s financial resilience and sustainability. Through the rigorous oversight and audit activities led by trained internal auditors, the government seeks to identify inefficiencies, streamline processes, and ensure compliance with regulations. By achieving the targeted increase in non-tax revenue performance, the state can unlock significant financial resources to support its developmental agenda, foster economic growth, and improve the overall well-being of its citizens.

    “Summarily, the programme aims at ensuring preventive and corrective actions to grow Non-tax revenues, review and improve Non-tax revenue processes to block leakages, conduct audit trail of non-tax revenue to vouch for adequacy of collections, ensure compliance; and provide assurance and validation. The target is to grow non-tax revenues from an average of 16 per cent to 40 per cent of total revenue,” Ayoola said.

    Mrs. Oyeyemi Ayoola clarified that Lagos State’s Internally Generated Revenue (IGR) comprises two main categories: tax revenue and non-tax revenue. Tax revenue, managed by the Lagos State Internal Revenue Service, encompasses various taxes such as personal income tax and capital gains tax. Conversely, non-tax revenue consists of fees, licenses, fines, and other income streams managed by different ministries, departments, and agencies in alignment with their respective mandates. Highlighting the diverse nature of non-tax revenue sources, she stressed that revenues collected, regardless of their classification, are deposited into the Lagos State Consolidated Revenue accounts through various banks across Nigeria. This consolidated approach ensures transparency and accountability in revenue management while facilitating efficient resource allocation for developmental projects and public services.

    Also, the Special Adviser on Taxation and Revenue, Abdulkabir Ogungbo said the training was aimed at expanding the Non-tax Internally Generated Revenue base as well as driving compliance of internal systems that would assist the state in achieving its expenditure target. The Permanent Secretary of the Office of Internal Audit, Kikelomo Dawodu, in her welcome address, said development is a catalyst in every endeavour of life; hence the need to ensure there were sufficient funds to keep Lagos running by ensuring that financial leakages are blocked to deliver better services to Lagos residents. Mrs Ayoola thanked Governor Babajide Sanwo-Olu’s administration for the opportunity provided for the internal auditors to gain more knowledge in the area of modern methods of auditing, as they would leverage technology to generate more revenue for the state. The Special Adviser also said the training had been impressive and impactful and would enhance the revenue system in the state. She added that Lagos State will not relent in its commitment to fill all the gaps in the state’s daily operations, in auditing non-tax operations for the benefit of the citizens.

    The Permanent Secretary of the Internal Audit, Mrs. Kikelomo Dawodu advised the participants to impact on their various offices and agencies with the new knowledge they have gained. This, she said, is because any professional session driven with technology which is faster and result-oriented is not a waste. One of the participants from the Lagos State Water Regulatory Commission, Mr Gandi Semako Oluwatosin commended the Governor Sanwo-Olu, the Special Adviser and the Permanent Secretary for selecting them to participate in the training, which, he said, exposed them to a modern approach to increase non-tax revenues.

    Participants of the training expressed their enthusiasm and appreciation for the valuable insights gained, emphasizing the significance of incorporating technological advancements into auditing practices to mitigate financial leakages effectively. One participant highlighted the importance of utilizing software skills to bolster auditors’ capabilities in preventing revenue losses, thereby augmenting Lagos State’s revenue base. The state’s commitment to modernizing audit processes reflects its overarching goal of leveraging technology to enhance the welfare of its residents. Mrs. Olowoidiaba Rashidat, representing the Lagos State Residents Registration Agency (LASRRA), underscored the imperative of transitioning towards a more robust tax revenue system.

  • Ernest Chukwuma shines as ABUAD’s top medical graduate

    Ernest Chukwuma shines as ABUAD’s top medical graduate

    In a resounding testament to academic prowess, Ernest Chukwuma distinguished himself as the best graduating student among 161 newly-inducted medical doctors at Afe Babalola University, Ado-Ekiti (ABUAD). His distinction underscores ABUAD’s commitment to nurturing academic excellence. In this special report, Associate Editor ADEKUNLE YUSUF writes that Chukwuma’s journey, fuelled by passion and inspired by mentors, embodies the university’s ethos of shaping future leaders in all fields of human endeavour.

    With the spotlight firmly fixed upon him, Ernest Chukwuma radiated an aura of exceptional brilliance during the February 9, 6th induction ceremony of the 161 newly-qualified medical doctors of Afe Babalola University, Ado-Ekiti (ABUAD). Amidst the palpable anticipation of the event, Chukwuma’s momentous achievement as the best graduating medical student elevated him to a position of reverence among his peers and mentors alike.

    His ascent to this pinnacle of academic distinction was not merely a stroke of luck but a testament to his unwavering dedication and scholarly prowess. Within the hallowed halls of ABUAD, Chukwuma’s name had become synonymous with excellence, a beacon illuminating the path for aspiring medical professionals. Yet, his accolades did not end there. In a display of unparalleled mastery, Chukwuma etched his name into the annals of medical academia by securing five distinctions across a spectrum of medical specialties: Anatomy, Physiology, Biochemistry, Integrated Medical Courses, and Pathology. Each distinction served as a testament to his comprehensive understanding and mastery of the intricate nuances within the field of medicine.

    As the ceremony unfolded, Chukwuma’s remarkable journey resonated with all in attendance, serving as both inspiration and aspiration for the next generation of medical practitioners. His achievement was not merely a personal triumph but a collective celebration of the relentless pursuit of excellence that defines ABUAD’s ethos. In the wake of his triumph, Chukwuma stood as a living embodiment of the university’s commitment to nurturing intellectual curiosity and fostering academic excellence. His journey from a diligent student to the epitome of medical brilliance symbolised the transformative power of education and the boundless possibilities it offers to those who dare to dream.

    Amidst the applause and accolades that enveloped him, Chukwuma remained humble, his gaze fixed not on the laurels of the past but on the boundless horizons of the future. For him, the journey had only just begun, with each achievement serving as a stepping stone towards a future defined by service, innovation, and unwavering dedication to the healing profession.

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    His journey towards stradom began in 2019, a pivotal moment midway through his MBBS programme, when Chukwuma’s remarkable intellect garnered international recognition. At the tender juncture of his medical studies, he was bestowed with an honourary Doctor of Science Degree (D.Sc.), with a Fellowship of the International Agency for Standards and Ratings. This prestigious honour was a testament to his groundbreaking research and scholarly acumen.

    Chukwuma’s ascent to scholarly stardom was catalysed by his groundbreaking  research article titled “Theory of Photon Quanta.” This seminal work not only elucidated intricate scientific principles but also garnered global acclaim. In a feat unparalleled, Chukwuma’s research emerged victorious among 5,547 nominations, triumphing over 87 meticulously screened contenders to clinch the esteemed 2019 Global Championship Award in Science.          

    Published in the revered Global Journal of Science Frontier Research, a physics and space science journal, Chukwuma’s research reverberated across academic circles, challenging conventional paradigms and pushing the boundaries of scientific inquiry. His visionary insights and meticulous methodology captured the imagination of scholars worldwide, cementing his status as a luminary in the realm of scientific inquiry. The Annual World Championship in Science Award, organised by the International Agency for Standards and Ratings, stands as a testament to excellence in academia. This prestigious event recognises the best among the brightest, honouring exemplary theses, dissertations and milestone research articles from distinguished scientists and academics across the globe.        

    Amid the fervour of international acclaim, Chukwuma’s unwavering commitment to excellence remained steadfast. His journey, marked by relentless pursuit and unwavering dedication, symbolised the transformative power of intellect and the boundless possibilities that await those who dare to dream. In the annals of scientific history, Chukwuma’s name would forever be etched as a beacon of ingenuity, a testament to the indomitable human spirit, and a harbinger of discoveries yet to unfold. His meteoric rise from a budding medical student to a celebrated scholar exemplified the power of passion, perseverance and the relentless pursuit of knowledge.

    The announcement of Chukwuma’s award resonated with the gravity of his achievement, as his research article emerged victorious amid stiff competition, prevailing over 5,547 nominations meticulously scrutinised from a pool of 87 contenders for the coveted title of the World Championship in Science for the year 2019. This accolade carried with it international validation, underscoring the global significance of his contributions to the field of scientific inquiry.

    The mandate of the World Championship in Science Award, as articulated in the announcement, is to spotlight and celebrate exceptional scientists and academics from across the globe. Chukwuma’s inclusion in this prestigious roster of honourees positioned him alongside luminaries such as Dr. Xiaohui Song from the United States, Dr. Hiroshi Bando from Japan, Dr. Ingo Schmidt from Germany, Dr. Yasin Idweini from Jordan and Dr. Kenichi Meguro from Japan, each of whom had left an indellible mark in their respective fields of expertise.

    Yet, behind Chukwuma’s meteoric rise to scholarly prominence lay a profound source of inspiration: his unwavering admiration for Albert Einstein, the iconic German physicist whose groundbreaking work on the theory of relativity continues to shape our understanding of the universe. From a tender age, Chukwuma had harboured a deep-seated desire to emulate Einstein’s intellectual prowess and transformative impact on the scientific landscape. Driven by this profound admiration, Chukwuma embarked on a journey fuelled by curiosity, tenacity and a relentless pursuit of knowledge. His milestone achievement in 2019 stood as a testament to the transformative power of inspiration, catapulting him into the ranks of the world’s most brilliant minds and affirming his status as a torchbearer for the next generation of scientific inquiry.

    As Chukwuma’s star continued to ascend, his journey remained intrinsically intertwined with the legacy of Einstein, serving as a poignant reminder of the enduring power of mentorship, inspiration and the indomitable human spirit to transcend the confines of time and space in pursuit of knowledge and understanding. Said Chukwuma: “I had watched a movie about Albert Einstein, the great German physicist, who invented the Einstein Refrigerator. How he wanted his voice to be hear d in his chosen field and how his voice was eventually heard. I too want my voice to be heard. With these awards, my voice is being heard, but this is just the beginning. I believe that by the grace of God and of course more hard work, many awards are still on the way.”

    Chukwuma’s revelation, shared in the wake of his triumphant win in 2019, shed light on the serendipitous genesis of his journey to scholarly acclaim. Despite his status as a medical student, his heart remained tethered to the realms of physics, his true passion and intellectual playground. It was in a physics class, amid the hushed whispers of curiosity and the tantalising allure of the unknown, that Chukwuma posed a question that reverberated through the corridors of academia. Yet, to his astonishment, the question lingered in the air, unanswered and elusive, a tantalising enigma that ignited the flames of inquiry within his soul.

    Undeterred by the absence of an immediate response, Chukwuma embarked on a quest for knowledge, determined to unravel the mysteries that lay concealed within the fric of the universe. With unwavering resolve and boundless curiosity as his guiding stars, he navigated the labyrinthine corridors of scientific inquiry, his thirst for understanding propelling him ever forward. It was amid this crucible of inquiry that Chukwuma found his answer, a revelation that transcended the confines of the classroom and opened the door to a world of infinite possibilities. From that moment onward, his trajectory was irrevocably altered, as he embraced his calling with fervour and embarked on a journey fuelled by the relentless pursuit of truth.

    In his remarks at the induction ceremony, Aare Afe Babalola (SAN), the esteemed Founder & Chancellor of ABUAD, extended heartfelt congratulations to the newly-inducted medical doctors, celebrating their remarkable achievements and urging them to view their induction not as the culmination of their journey but as the commencement of a new chapter filled with boundless opportunities and untapped potential. Emphasising the importance of excellence and quality service in their future endeavours, Aare Babalola underscored the profound impact that the inductees would have on the world around them. As torchbearers of knowledge and ambassadors of compassion, they were entrusted with the noble task of alleviating suffering, healing the sick and advancing the frontiers of medical science.

    For Chukwuma and his fellow inductees, the words of Aare Babalola served as a poignant reminder of the immense responsibility that lay upon their shoulders. Armed with knowledge, fortified by wisdom and guided by the principles of integrity and compassion, they stood poised at the threshold of greatness, their destinies intertwined with the collective aspirations of humanity. His words: “I personally expect you to go higher academically and professionally. Never give up, dream high. Remember that it is not a crime to dream big, but it is a sin not to dream high. Your induction today should not be seen as the end, but the take-off points for you to attain greatness in your career.

    “I am not unaware that the country is going through a difficult time having regard to insecurity, corruption, scarcity of money, fuel scarcity, unemployment, poor infrastructure, high rate of inflation, very poor foreign exchange rate, huge debt burden and the “japa syndrome”. I advise you not to be discouraged. Problems are bound to come. The world is a world of problems. It is only those who have the courage to confront these problems frontally and overcome them that are successful in life. You already have imbibed the culture of this university, therefore, you are already sufficiently armed to confront and overcome these problems,” he said.

    In a heartfelt address, the ABUAD founder thanked parents for choosing ABUAD, emphasising its unique features. He urged continued guidance for the new doctors, highlighting the disparity in philanthropy. Babalola unveiled plans for a Museum and Hall of Fame, expressing hope for their future success and contributions. Reflecting on his recent achievement as the best graduating student among the 161 newly-inducted medical doctors, Chukwuma  said, “I am very happy. Words are not enough to express my delight following my emergence as the best graduating student. I thank God Almighty for making this possible. I’m grateful to the university for finding me worthy to receive this award.”

    He continued, acknowledging the pivotal role of ABUAD in shaping his journey, “I’m also grateful to the university for shaping me to be the man I am today. I am especially grateful to the founder, Aare Babalola. He has been a great source of inspiration and drive for me. I thank my wonderful friends and family for their incredible support along the way.”

  • Developers offer rent-to-own initiatives to promote home ownership

    Developers offer rent-to-own initiatives to promote home ownership

    Through a robust Public-Private Partnership (PPP) with the Lagos State Government and the Federal Mortgage Bank of Nigeria (FMBN), five prominent property developers are spearheading a groundbreaking initiative known as “rent-to-own.” This innovative scheme enables tenants to transition into homeownership by acquiring their h ouses and paying rents over a specified period. Effectively turning tenants into landlords, this initiative has the potential to serve as a blueprint for addressing Nigeria’s staggering housing deficit, estimated at 28 million units as of 2023. If replicated nationwide, this initiative could significantly mitigate the housing crisis. VICTORIA AMADI delves deeper into this transformative endeavor.

    Nigeria continues to grapple with a persistent housing crisis, as underscored by recent estimates from PricewaterhouseCoopers (PwC Nigeria). According to PwC’s Nigeria Economic Outlook, the country’s housing deficit stood at a staggering 28 million units as of 2023. This alarming figure paints a stark picture of the challenges faced by millions of Nigerians in accessing adequate and affordable housing. Adding to the complexity of the situation, the United Nations Population Fund reported a high birth rate of 36.026 births per 1,000 people in 2023, against an estimated population of 223.8 million individuals. These statistics highlight the urgent need for comprehensive solutions to address Nigeria’s growing housing needs amidst rapid population growth.

    The recent PricewaterhouseCoopers (PwC) report, published last week and obtained by The Nation, sheds light on Nigeria’s daunting housing deficit. Despite the country’s substantial shortfall in housing units, demand for housing remains subdued, attributed to elevated rental and construction expenses, coupled with declining disposable incomes. However, even before the release of the report, prominent property and estate developers had pledged to play their part. Through structured “rent-to-own home acquisition schemes,” they aim to alleviate, if not entirely eliminate, Nigeria’s staggering 28 million housing shortfall.

    At least, five developers are said to be currently leading the charge in deploying such structured rent-to-own home acquisition schemes that allow tenants to acquire their houses, pay rents over a period and own those houses. The five developers, which have since latched on Public Private Partnership (PPP) with the Lagos State Government and the Federal Mortgage Bank of Nigeria (FMBN) to make home ownership seamless and affordable to Nigerians, include Legrande Properties, Mixta Africa, Alpha Mead, Family Homes Funds (FHF), and Lagos Ministry of Housing.

    For instance, in what is widely acknowledged as a timely and compelling proposition, Mixta Africa has been offering interested subscribers the opportunity of starting out as tenants paying their due rent and subsequently becoming landlords/homeowners within a remarkably short period of three years. The property developer does this through its rent-to-own home acquisition scheme known as ‘DUO,’ which is a homegrown housing ownership solution targeted at mid-income earners who have difficulty paying outright for a house or experiencing delays in accessing a mortgage.

    Rolake Akinkugbe-Filani, the Chief Commercial Officer (CEO) of Mixta Africa, elaborated on the DUO initiative, stating that it provides interested subscribers with the chance to fulfill their aspirations of homeownership while experiencing the perks of residing in a tranquil and luxurious environment. The initiative ensures that tenants can enjoy all the comfort, convenience, and recreational amenities essential for a healthy lifestyle. Akinkugbe-Filani emphasized that DUO offers renters the unique opportunity to transition seamlessly from tenants to homeowners through a simple and straightforward transaction process.

    Akinkugbe-Filani, however, told The Nation that DUO, as a rent-to-own scheme, is currently applicable to Mixta’s fully completed two-bedroom Marula Park home, located in Lagos New Town, off Lekki- Epe Expressway, with Beechwood Park and Lakowe Lakes Golf and Country Estate as its close neighbours. “The thought of being a tenant paying your due rent and subsequently becoming a homeowner within three years is the major attraction,” the property developer emphasised.

    Legrande Properties, a Lagos-based property developer, has also come up with a rent-to-own initiative aimed at meeting the huge housing needs of Nigerians. Accordingly, the company is currently developing 5, 000 affordable housing units in Lagos. Its Managing Director, Babajide Durojaiye, however, explained that the initiative is an opportunity for only contributors to the National Housing Fund (NHF), and that the initiative is premised on its new project called, ‘Alexandra Courts Estate’ in lbeju-Lekki, Lagos.

    The project, according to Durojaiye, is a PPP with Lagos State Government and Federal Mortgage Bank of Nigeria (FMBN). “It (the project) also provides opportunity for loans to off-takers who are contributors to the NHF scheme up to N15 million,” he said, adding that Legrande Properties has also earmarked 2,500 units for staffers of the Trade Union Congress (TUC), Nigerian Medical Association (NMA), Nigeria Labour Congress (NLC), Nigeria Union of Teachers (NUT), and civil servants at the Asiwaju Bola Ahmed Tinubu (ABAT) Renewed Hope City at Ibeju Lekki, Lagos.

    On its part, Alpha Mead, another developer, said it has initiated two models, ‘Rent4Less’ and ‘Rent-to-Own,’ to enable affordability of housing for Nigerians. The Group Managing Director, Alpha Mead, Femi Akintunde, said the company’s intervention stemmed from its worry that landlords, over the years, have been charging one to two-years rent on their properties. He also noted that government’s idea of considering monthly rent payment is not the right way to go since “One cannot legislate on what he does not own.”

    “What should be done is to meet the objectives of landlords and tenants for the system to work,” Akintunde told The Nation, noting, for instance, that Alpha Mead’s Rent4Less approaches landlords with large units, enabling them pay upfront and fill it up with tenants who want to pay monthly. “Rent-to-Own’ combines our affordable housing solutions and mortgage accessing capabilities to help subscribers on Rent4Less own their homes,” he added.

    Also, with its mandate to provide 500, 000 housing units in five years, while creating over two million jobs in the process, Family Homes Funds (FHF) has been facilitating home ownership for Nigerians through its product, ‘Help-to-Own.’ On the strength of its product, the Funds, The Nation leant, has contributed 40 per cent of the total cost of new homes for low-middle income individuals as loan.

    Interestingly, the product does not require repayment of the loan in the first five years after which monthly payments are made, starting from an interest rate of three (3) per cent, and rising gradually to a maximum of 15 per cent in the 20th year. It is for first time home buyers and for individuals who can provide a minimum deposit of 10 per cent of the purchase price and can take responsibility for any associated fees. The product is also for those who earn between N500, 000 and N1.7 million yearly.

    The Lagos State Government through its Ministry of Housing is also not left out in the renewed push to put affordable and decent shelter on Nigerians. Despite being seen by many home seekers as an exploiter and a major competitor with private developers, the State Government also has a Rent-to-Own housing scheme that targets first time home buyers. This scheme is a response to the concerns raised over the unfriendly conditions attached to home ownership through the Lagos Homes Mortgage Scheme (LagosHOMS).

    LagosHOMS has about 4,355 housing units it inherited from the mortgage scheme. These houses came from 12 housing estates that include Sir Michael Otedola Estate, Odoragunsen, Epe, Odo Onasa, Agbowa, Igbogbo Housing Estate, Ikorodu, Egan -Igando Housing estate, Alimosho, Lateef Jakande Gardens, Igando also in Alimosho.

    Other estates for the scheme are CHOIS City, Agbowa, Olaitan Mustapha Housing Estate, Ojokoro, Iponri Estate, Surulere, Sangotedo Estate, Eti-Osa and Ajara Estate, Badagry. The scheme enables individual subscribers to pay only five per cent of the cost of the housing unit as commitment fee and the balance is spread over a period of 10 years with minimal interest.  According to the State’s Commissioner for Housing, Moruf Akinderu-Fatai, Rent-to-Own, has recorded about 1,230 beneficiaries from inception. Although, at moment, these initiatives are focused on Lagos, the consensus of stakeholders in the real estate sector, including property developers and prospective homeowners is that if sustained and replicated across the country, they could be the much-needed tonic to galvanize ubiquitous home ownership schemes in Nigeria and ultimately close or reduce the country’s huge housing deficit.