Closure of NERFUND May Truncate Recovery of over N7bn

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Olaseni Durojaiye

It would seem like top management of the Federal Ministry of Finance shot themselves in the foot as the unprecedented act of shutting down the National Economic Reconstruction Fund (NERFUND) indefinitely last Thursday may have truncated the recovery of over N7billion owed the agency by Micro Small and Medium scale Entrepreneurs (MSMEs).

An industry source, who spoke to THISDAY in Abuja also hinted that the directive of the Minister of Finance, communicated via circular Nr. F.12891/S.3/T1/254 by the Permanent Secretary, Dr. Mahmoud Isa Dutse, may likely incense the National Assembly who may view the action of the ministry as a usurpation of the powers of the legislature.

It could be recalled that similar decision of former President Olusegun Obasanjo to order the close down of NERFUND without repealing the Act setting up the agency by the National Assembly was mentioned amongst other reasons given for the commencement of impeachment proceedings against the former President by the Hon Ghali Na’aba led House of Representatives.

In the latest development, the Permanent Secretary stated that the ministry was ordering the immediate close down of the agency indefinitely while staff members are to proceed on indefinite leave, following a peaceful protest by the members of staff of NERFUND over welfare issues and the lingering merger impasse.

Speaking to THISDAY weekend in Abuja, an official of the Ministry who pleaded not to be mentioned wondered if by shutting down NERFUND indefinitely and sending the staff and management on indefinite leave, the Permanent Secretary was not encumbering on-going effort of the Management and Staff to recover over N7 billion owed the Federal Government as loan granted to MSMEs by NERFUND.

It was gathered that upon assumption of duty in October 2013, the immediate past Executive Management of NERFUND made the recovery of these loans its prime mandate. During this period and with support of the ministry of finance and staff members, about N1.2billion had been recovered.
Efforts to speak to NERFUND Head of Media, Alhaji Ali proved abortive as calls to his phone returned unanswered.

However, an official of the staff union, Mr. Yusuf Ngati, questioned the rationale of the decision of the Ministry for sending the staff of the agency on compulsory and indefinite leave whereas the executive management that where been accused of operating without valid appointment were simply asked to return to their employments at NDIC and CBN. In his view, this amounted to punishing the whistle blower while the accused was set free without trial.

During a visit to the NERFUND head office on Wuse Zone 4, Abuja yesterday our correspondent saw armed police guarding the premises, even though there was no sign any damage to property.
It was however, no possible to confirm at press time whether the members of staff shall be entitled to payment of their salaries while serving this compulsory indefinite leave.
NERFUND is an intervention agency established via Act 254, Laws of the Federation of Nigeria in 1989 to provide funding for the setting up of Small and Medium Scale Enterprises (SMEs).