The acting Managing Director of the Nigerian Social Insurance Trust Fund (NSITF), Mr. Ismail Agaka recently spoke with journalists on the amendment bill seeking to expand the mandate of the organisation, and the status of the Employees’ Compensation Scheme. DamilolaOyedele presents the excerpts:
There is a bill in the National Assembly to amend the NSITF Act, and expand its mandates beyond the Employees Compensation Scheme. What is the latest development in this regard?
Indeed, there is a bill in the National Assembly for the amendment of the NSITF Act to execute other programmes apart from the compensation scheme. Nigeria is currently implementing seven out of nine of social security recommendations:Convention 102 of the International LabourOrganisation. We are not implementing family benefits and unemployment benefits yet, but they are critical. It would however be pre-emptive to disclose the full details since the public hearing on the bill is yet to hold. The public hearing is an important part because it would afford us the opportunity to hear from critical stakeholders, provide procedures of global best practices and such, so that we can have a much more comprehensive package for employees beyond the compensation scheme. The Employees Compensation Scheme (ECA) itself has grown over the years and we have made 45,000 registrations from zero in five years. In the last eight months alone, we moved from 40,000 to 45,000. In terms of claim settlements, we have also moved from zero claim settlement and compensation to over N700 million. We also moved from zero beneficiaries to over 6,000 beneficiaries. So the ECA is also on the right path, but the amendment bill before the National Assembly will do much more than the compensation aspect.
But the ECA continues to face several challenges, what are you doing to make it attractive particularly to employers who may just regard it as a financial burden?
Yes, we have challenges, we could have done better, but the main issue seems that we have not enlightened the public enough. But we are taking steps by sustaining aggressive campaigns and enlightening our publics who include trade unions and employers of labour. We are also talking to the state governments to explain the benefits of the ECA. Admittedly, the current economic situation has limited our reach in terms of collecting contributions from employers. There are some employers that have had to close shop amongst those that were registered while those that have not closed shop; have had to reduce their workforce drastically. All of these are factors that are inhibiting the expansion of the scheme. There is no doubt that the economic recession has really hit some of the critical sector of the economy very hard. For instance, some have been forced to reduce staff while some had to reduce staff remunerations. Contribution is a function of the payroll of organisations; therefore, the reduction of staff or their salaries will affect the amount of contribution into the scheme directly.
What are you doing to ensure the buy-in of state governments?
Bauchi state is already registered on the scheme and will soon begin contributing. The process of its contribution is already in the works and we expect the details to be finalised very soon. We have met with the Lagos State government officials and are now in the process of getting them registered on the scheme. The management is talking with Edo and Zamfara states with a view to getting them on board soon. We have received invitation from many states to make presentations to them on the scheme.
We are present in all the states with 67 offices nationwide: 11 regional offices, 55 branch offices and the headquarters. While it is desirable to be present in all the 774 local councils in the country, the scheme is still too young to be present in all the councils. Any rush to increase our presence in every local council will mean we would not build reserve. A social security programme cannot be run without building a very robust reserve. We intend to expand our presence in all the states of the federation but we have to be strategic in doing so.
What processes do employers have to comply with, in times of workplace accidents?
If the accident occurs in the workplace, the employer owes the employee the duty of care by offering e at least first aid treatment. It is after the stabilisation of the worker that the office reports to the NSITF and then the process begin. Whatever medical expenses that might have been incurred prior to reporting to the NSITF, would be refunded. If there is any need for the employee to obtain further rehabilitation as the case may be, it is the responsibility of the NSITF. But the first point is that the employer must be registered on the scheme and also the accident must also be reported to the Fund through a laid down procedure.
Are victims of air crash covered under the scheme?
First, if the employer of such a victim of plane crash is registered, the survivor of such a person would be compensated. Secondly, the journey must be in the course of carrying out official duty. If it is confirmed that it was an official trip in the course of work, then the next of kin or the dependants of the deceased employee is covered. Indeed, many such claims have been processed by the NSITF. The Act recognises up to four children. We also have a formula to determine entitlements depending on circumstances of the accident. When that is computed it is then paid regularly to the beneficiary, in the case of the breadwinner being deceased. We have a family whose breadwinner died and after the computation of the entitlements, we are now paying up to N1.3million monthly to the beneficiaries. That represents 90 per cent of the last income of the deceased breadwinner.
Can employees register by themselves?
There is no provision for self-registration by any employee . Every worker willing to register must come through an employer because the scheme is employers’ obligation. Everybody is exposed to one form of occupational hazards or the other in the workplace. Employers have to realise that boosting the morale of their workers is beyond just increasing salaries and allowances. This line of thinking is what that influenced the various types of benefit scheme and mortgage facilities to increase workers productivity. Higher bottom-line means more money coming into the company. It will also lead to better industrial climate in the workplace. A harmonious industrial relation in the country would lead to national cohesion. The burden of care is transferred to the NSITF for an employer in case of any workplace accident, injury, disability or occupational disease. The scheme helps employers overcome unanticipated expenditure especially if such happens when the organisation is not financial strong enough for such expenses. How do organisation address this kind of development during cash flow challenge? Such development could lead to employees seeing their employers as wicked and uncaring regardless of challenges such employer may be going through.
Will the NSITF review its contribution rate?
We are in the process of reviewing our rate of contribution to reflect the risk exposure of organisation. While there is risk rating, there would also be merit rating. Merit rating is reviewing downwards the contribution of those that are regular in their contributions and are not in the habit of filling claims for compensation periodically.