The new management of the Nigeria Social Insurance Trust Fund must leave no stone unturned in reversing its negative public image crisis occasioned by lax cooperate governance, among others, by the previous administration, writes James Emejo
The NSITF has a primary mandate to provide compensation to insured employees in case of work-related diseases, disability, injuries, or death- when such demise happens in the workplace or outside it.
The fund was a Defined Benefits Scheme (DBS) with initial monthly contribution of 7.5 per cent of basic salary out of which 2.5 per cent is borne by the employee, and 5 per cent by the employer.
However, the fund’s activities in recent times had been a major source of concern rather than comfort to workers and the public.
Only late June, the Senate Public Accounts Committee, chaired by Senator Mathew Urhoghide, unearthed a litany of unwholesome practices ranging from misappropriation of about N84 billion within four years.
The fund, which was established in 2011 had regrettably been described by the senate committee as a cesspool of corruption.
The lawmakers, who relied on the report by the Auditor General for the Federation (AuGF) alluded to the fact that between 2012 and 2016, the management and board of NSITF colluded to defraud the organisation.
Urhoghide said: “They are all guilty. They are implicated. They stole the place dry. The agency is most defiant and most notorious.”
The audit had among other things, pointed out that, “the Fund had been implementing a salary structure that is not approved by the National Salaries, Income and Wages Commission. As a result, irregular payment of N38,219,919,530.32 by way of personnel cost was made to the staff of the Fund from 2012 to 2017.
“Implementation of unapproved salary structure may result in wastage of public funds, as remuneration may be higher than the productivity level of staff.
“The Managing Director is required to provide the approval of the National Salaries, Income and Wages Commission for the implementation of the Fund’s salaries structure.”
In another query by the AuGF, it observed the fund’s bank statements for the period under review revealed that contributions received from the federal government in 2014, amounting to N 5,500,000,000.00 were diverted to a Zenith Bank account number 1013938003, instead of the Skye Bank account number 1790122304 into which other contributions were paid, without providing any authority or any form of explanation for such diversion.
“Audit further observed the following: The bank account was opened without the approval of the Accountant-General of the Federation, as no such approval was presented for audit. The new account was opened specifically for this purpose as seen in the bank statements where a first tranche of N2,750,000,000.00 was used in opening the account on August 29, 2014.”
Definitely, these infractions are least expected from an agency that is set up by an Act of Parliament to bring succour to vulnerable workers, who toil day and night to secure their future.
The organisation had operated for the most part of its existence in obscurity- only known to the public whenever there was a scandal.
The Road to Redemption?
Following the rot in the NSITF and the need to get to the root of the issues, the federal government had commissioned an inquiry into the affairs of the fund.
Consequently the Report of the Presidential Joint Board and Audit Investigation Panel set up in July 2020 to investigate the infractions of the Public Procurement Act, 2007, and the Financial Regulations (FR) in the fund, came up with recommendations and consequences.
To clear the way for sanity in the organisation, the former Managing Director of the fund Mr. Bayo Somefun, and three other former executive directors with NSITF were indicted and made to refund to the treasury of the fund a total of N181.05 million being alleged to be illegal over payments in salaries and allowances.
The presidency also terminated the appointment of the erstwhile Head of Procurement Department, Mr. Abdulrasheed Lawal, from the Public Service with effect from the date of suspension.
In May, President Muhammadu Buhari approved the reconstitution of the NSITF Management Board and appointment of Dr. Michael Akabogu as the new Managing Director of the Nigeria Social Insurance Trust Fund, NSITF as well as approved the recommendations of the audit panel.
A New Day at NSITF
On assumption of office, Akabogu assured that the days of financial recklessness and misappropriation were over at the fund adding that though the fund had been in the eye of the storm in recent times, leading to bad public perception, measures have been put in place to redeem its image moving forward.
Akabogu, while unveiling his agenda to reposition the organisation during an interactive session with journalists in Abuja, promised to ensure prompt payment of claims and widen the spread of enrollees adding that over seven million employees are currently covered by the scheme.
He stated however, that the fund had achieved some milestones notwithstanding the negative perception.
According to him, the NSITF had generated N180 billion between July 2011 when it was established and May 2021 and settled claims and applications of over 52, 000 beneficiaries adding that out of the 200,000 employers, only about 170,000 are currently active.
The NSITF MD, however said the new leadership will embark on the automation of services and migrate its operational procedures from manual to electronic platform to reduce delivery time from the current 14 days to 11 days.
He also lamented that the operators of Ponzi schemes had in the past taken undue advantage of the NSITF operational gaps to fleece unsuspecting members of the public, but hoped that automation will provide solutions to these and many other challenges confronting the fund.
Akabogu, who was a general manager in charge of risks in the fund, promised to deploy his expertise to “clear the banana peels” and reposition the organisation, pointing out that he will be unveiling an elaborate policy blueprint for the fund in the two months.
He said: “We are all insiders and we know where the problems lie. This organisation will be a new kid on the block.” He added that even though the fund had been assigned negative perception in the past, the sordid experiences will never be repeated going forward.
He pointed out that all past infractions had been duly investigated while those found culpable were being prosecuted and recovery of properties initiated. Among other things, the MD said he would also focus on creating pathway to reward staff excellence as well as commit to their welfare.
He said he will reposition the public perception of the fund and showcase what it is all about – and introduce performance index to measure staff productivity and attitude to work.
Akabogu’s appointment followed the approval of President Muhammadu Buhari for the reconstitution of the NSITF management board as well as the recommendations in the Report of the Presidential Joint Board and Audit Investigation Panel set up in July 2020 to investigate the infractions of the Public Procurement Act, 2007, and the Financial Regulations (FR) in the NSITF.
But despite the promises by the new leadership, Nigerians believed it is only a matter of time to see how much progress will be achieved in the organisation.
