NECA EXPRESSES DISSATISFACTION OVER FG POLICY ON 50% DEDUCTION OF GROSS INFLOW UNDER THE FRA 06-02-24
By Sadiq Aminu The Nigeria Employers Consultative Association , NECA has expressed dissatisfaction over the new Federal Government policy on 50% deduction of Gross Inflow under the Fiscal Responsibility Act.
NECA has also frowned at the listing of the Nigeria Social Insurance Trust Fund, NSITF among the agencies affected by the deduction of internally generated revenue.
The Director General of NECA,Mr. Adewale Oyerinde, made the position know ln while on a working visit to the NSITF in Abuja.
NECA, alongside the Organized Labour and Government, constitute the tripartite owners of the NSITF.
Mr. Oyerinde said NECA was of the view that the contributions by the employers to the NSITF was not revenue to government and would embark an advocacy to reverse the policy.
“It is absolutely not a revenue to the government. It is meant for a purpose, and the purpose for which it is meant will be compromised if that policy goes through. So, we have also started our own advocacy at the back end. In fact, we had a meeting with the Security and Exchange Commission (SEC)last week because it also affected them . Our advocacy is already in place, and we will continue to engage
“We have started doing that. In fact, when this visit was scheduled, we wanted to also get your perspective so that we can input your own perspective into ours and then make public our definitive views.
“We intend to bring the organized labour into the issue because business is an entity that doesn’t have blood running through its veins. It is people. It is the people who are susceptible to injuries and accidents, and those people are primarily members of the organized labour . Our belief also is that the organized labour will not fold their hands or play the ostrich and believe this doesn’t involve them because at the long run, it is the members of labour, the workers that will be affected.
“So we are also bringing them on board in our advocacy. In the next two, three days we will be writing to the Minister of Finance so as to let him know the critical stakeholders of the fund are in alignment that contributions from employers to the NSITF are not revenue to the government.”
The NECA DG commended the management of the (NSITF) for the innovative measures it has taken to re-position the tripartite agency.
Oyerinde who appreciated the critical role the NSITF plays in stabilizing the world of work, pledged the continued support of the Organised Private Sector(OPS) to the fund as social partners despite the situation of the national economy.
He said, “we have noted the many innovations that you brought in during this one year, and from far within our space, we have also noticed how much stability you have brought to the fund.
“We have also noted the direction that the fund seems to have now, especially the openness to engage because I know your Executive Director, Operations has been in Lagos twice. To us, this openness to engage has endeared the fund to us the more. So, kudos to the fund and its leadership.”
The NECA Director General, who took a close-up on recent measures and activities of the NSITF, urged the management to remain focused as a responsible agency.
“One of the things we strongly believe in is responsible enterprises, an employer that is responsible to its internal and external stakeholders – internal stakeholders – its employees within the context of salary payment, welfare issues, an employer that is responsible to its community and how much it can do within the context of corporate social responsibilities, an employer that is responsible to government within the context of paying the taxes and so many other contributions.”
He further threw the support of NECA behind the Fund’s effort to bring to book, defaulting employers as well as others who falsify records to under-declare contributions or obstruct access to the employers registers, as raised in the address of the Managing Director of the Fund, insisting that every “enterprise must be responsible” He however advised that evidence of such default must first be strongly established.
He further priased the NSITF for winning the NECA 2023 Award in Best Service Delivery category, stating that NSITF coming tops was well deserved .
“It was a poll by employers themselves, uninfluenced and not subject to influence as everyone can see. NECA Award is not the type you pay money to be nominated. We firmly shut our doors to that, and our award remains the most unbiased in the country.”
Earlier in her welcome address, the Managing Director of the NSITF, Maureen Allagoa who declared NECA as the Fund’s most reliable social partner in the administration of the Employees’ Compensation Scheme (ECS), added that the Organised Private Sector which NECA represents was responsible for over 80% of the ECS contributions collected in 2023, saying that the figure is expected to rise in 2024.
She said the NSITF appreciates the support and partnership of NECA and considers the organized private sector invaluable for the continued administration of the ECS.
Noting that the Fund will continue to partner and consult NECA in all major decisions that affect the two, Madam Allagoa stated that it was on the advice of NECA that it introduced a modified one- off registration fee of N20,00 for new registering employers and a recurring certificate processing fee of N30,000 for employers requesting for compliance certificate.
She added, “also in line with NECA’s advice and to also justify the value for money, we have decentralized our compliance certificate processing by divesting over 90% of the process to the branches and regions, while the head office only produces the certificate for onward delivery to the employers.”
She explained that this was to drastically shorten the turnaround time for the issuance of certificates, stressing that the ongoing digitization of the Fund via the E-NSITF will reduce the exercise to 48hours
Madam Allagoa further urged NECA to assist in the enforcement of the 1% deduction from the total remuneration as stipulated by the ECS instead of 1% of Basic, Housing and Transport as still practiced by some private employers, despite an updated communication on the issue by the NECA secretariat.