September 30, 2020

Senate moves to place NSIA on 20% first line charge from all revenues accruable to the Federation Account

The Senate

The Senate

….As Senate Gets 2021-2023 MTEF/FSP Report Ahead of presentation of 2021 Appropriation Bill

By Henry Umoru

THE Senate has began plans to place the Nigerian Sovereign Investment Authority (NSIA) on a 20 per cent first line charge from all revenues accruable to the Federation Account.

The action of the Senate was sequel to “A Bill for an Act to amend Allocation of Revenue (Federation Account, Etc.) Act CAP A 15 LFN 2004” sponsored by the Senator Bassey Albert Akpan (Akwa Ibom North East).

The Bill which scaled second reading in the Senate, was  referred to the Senate Committee on National Planning for further legislative action.

Senators in their contributions supported the Bill and approved that it be read for a second time, when it was put to voice vote by the Senate President, Ahmad Lawan.

In his lead debate, Senator Akpan explained  that the Bill seeks to amend the Allocation of Revenue (Federation Account, Etc.) Act, “to make the NSIA a first line charge beneficiary of the Federation Account for saving purposes.”

He said, “The Bill seeks to amend Section 1 of the principal Act to provide for additional funding for the NSIA by including the NSIA as a first line charge beneficiary of the monthly distributable funds from the Federation Account.

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“We had earlier proposed an amendment to section 162(3) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) to provide for the inclusion of the Nigeria Sovereign Wealth Funds established under the Nigeria Sovereign Investment Authority (Establishment, Etc.) Act in the distribution of any amount standing to the credit of the Federation Account.

“We had equally proposed an amendment to sections 30(1) and 47(2) of the Nigeria Sovereign Investment Authority (Establishment, Etc.) Act Cap A 15 Laws of the Federation, 2004 to provide additional funds for the Sovereign Wealth Funds (SWF) through a statutory allocation of funds from the monthly revenue accruing from the Federation Account and strengthen the operations and withdrawals from the SWF by the Federation to further boost the confidence of the Federating units in the operations of the Fund to the benefit of all.

“The proposed amendment as contained in this Bill is therefore to complete the series of amendments in this regard by developing a constitutional and consistent monthly saving culture for the Federation against the rainy day while guarding against constitutional breaches and or conflict of laws.

“The Bill proposes an amount (equivalent to 20 per cent of the amount Standing to the credit of the Federation Account, less the statutory 13 per cent of the revenue accruing to the Federation Account directly from natural resources) to be allocated to the Nigeria Sovereign Investment Authority, on monthly basis.

“Let me strongly emphasize the need for a dedicated saving culture to safeguard the Nigerian economy going forward due to the rapidly changing dynamics and volatility of the global oil market.

“Let us learn our lessons now with the outcome of the COVID-19 pandemic because none of us knows tomorrow.”

Meanwhile, ahead of the presentation of the 2021 Appropriation Bill by President Muhammadu Buhari to the Joint National Assembly,  the Senate yesterday received the report of the Joint Committee on Finance and National Planning and Economic Affairs on the 2021-2023 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).

The report, which was presented at plenary, was laid by the committee chairman, Senator Solomon Adeola, All Progressives Congress, APC, Lagos West.

Recall that the Senate President, Ahmad Lawan, while welcoming lawmakers back from the two-month recess on Tuesday, had hinted that the consideration and passage of the MTEF/FSP document would precede the presentation of the 2021 budget estimates by President Muhammadu Buhari next week.

The Senate is expected to consider the report on the next legislative day as relevant committees have been directed by Lawan to provide adequate copies of the report to members of the Senate.