The Federal Government has been called upon to punish corporate organisations that default in discharging their responsibilities under the National Housing Fund (NHF) Scheme.
Managing Director, Union Homes Savings and Loans Plc, Mr Samson Thomas, stated this in a paper he presented on exploring conventional and alternative strategies for Social Housing in Nigeria.
He noted that the NHF established by the federal government through the National Housing Fund Act No 3 of 1992Â created a mandatory contributory scheme to provide a pool of cheap and long_term loanable funds for housing credits.
Thomas, however, observed that the NHF scheme had the challenges of non_remittance of employeesâ€™ contributionsÂ to FMBN by employers; refusal by corporate contributors to comply with the directives of NHF Act; low level of income of many Nigerian workers; cumbersome and expensive processes and the potential for huge fund mobilization not fully tapped.
The Union Homes boss therefore called for punitive measures to be taken on corporate contributors who fail to comply with the provisions of the NHF Act, adding that employers should be compelled to come up with matching contributions to make the scheme more robust.
He further advocated that the Federal Mortgage Bank of Nigeria (FMBN) should embark on extensive enlightenment campaign to increase awareness about the scheme.
The NHF Act made it mandatory for Nigerian workers in both the public and private sectors earning N3,000 per annum or more to contribute 2.5 per cent of their monthly salaries to the housing fund at an interest rate of 4 per cent to each savings/contribution made, while banks are mandated to contribute 10 per cent of their loans and advances to the Fund at an interest rate of 1 per cent above the rate on current account.
The decree also mandated the Nigerian Social Insurance Trust Fund (NSTIF) – now represented by the Pension Funds Administrators (PFAs) – and the insurance companies to invest a minimum of 20 percent of their non â€“ life funds and 40 percent of their life funds in real estate development, of which not less than 50 percent must be channelled through FMBN, at an interest rate not exceeding 4 per cent.
Also under the scheme, the Federal, State and Local Governments are to make direct budgetary allocation of a sum not below 2.5 per cent of their revenue to the housing scheme.
The Fund is to be administered by the Federal Mortgage Bank of Nigeria (FMBN) to boost the housing sector through a properly devised system, thereby liberating deposit money banks from the burden of mortgage loans, and facilitating home ownership for the average Nigerian worker.
However, some stakeholders have alleged that FMBN does not approve NHF loan applications with dispatch as they are forwarded by PMIs, or fail to apply appropriate sanctions on non_performing or fraudulent PMIs, who do not make timely returns of monthly contributions received from NHF contributors through various PMI accounts.
Part of the criticism is also that the Central Bank of Nigeria (CBN) and other regulatory bodies have never wielded the â€œbig stickâ€ to enforce the provisions of the NHF upon various defaulting institutions.