January 19, 2022

Viewpoint: A chink in Nigeria’s social security


By Simeon Nwankwo-O’diwe

THERE is little debate that investment in social security takes a high watermark in the Buhari administration.

At the last count, there are over five social security programmes besides the N-Power been administered since 2015. There is even a new Ministry of Humanitarian Affairs and Disaster Management. Then, the Nigeria Social Insurance Trust Fund, NSITF, the main agency of government charged with all seasons of social security for the nation’s workforce.

Unfortunately, so many Nigerians, including the elite, know little about the roles assigned to the NSITF by the Employee Compensation Act of 2010, which may sound strange. But it is true. It came to the fore at the peak of the COVID-19 pandemic in 2020, when junior doctors under the Nigeria Association of Resident Doctors went on strike over inadequacies in the health sector, including hazard allowance. In fact, the strike which came in spurts became the major feature of the nation’s health management system for the better half of 2021.  

While the government had on its own declared the prevailing N5000 allowance as slavery and unilaterally doled out N32b as hazard allowance, the discussion was moot for a permanent solution to the disagreement which the Federal Government later took head-on with N50b provision in 2021 supplementary budget.

This unfortunately is dogged till today by disagreements between doctors and other professionals in the health sector. But that is not the gist. It is that these doctors did not know the additional role the NSITF plays in matters of hazards; injuries or death sustained in workplaces. Facts that emerged during negotiations show that the doctors were not aware that beyond hazard allowance, their dead and injured colleagues could be compensated by the NSITF where their employers are enrolled into the scheme and adequate claims forwarded. 

The Employee Compensation Act of 2010 empowers the NSITF to give indemnity to workers who either die or sustain an injury in the cause of work as well as pay compensation to the employer, who upon verification, has lost man-hours in respect of death or injury or incapacitation of his staff. The issue here is that if our doctors as enlightened as they are, knew little of this crucial role of NSITF in the social security system, who else should know?

This brings up the matter of the huge gap in our social investment system. There is a palpable chasm between such an agency and the public.

The reluctance of the public and private institutions to make the necessary buy-in without which the role of the agency is lost, a factor which in the past, left it at the mercy of frustration, and consequent manipulations by unscrupulous persons, is a big challenge. Part of the reasons for this popular apathy may not be unconnected with the poor dispensation of social benefits by allied agencies of government.

Such will continue to set the public on the back foot. More than any other administration in the country, the Buhari government has invested hugely in social security as I have stated earlier but do Nigerians get it huge in return? The answer depends on variables but the general view is to the negative.

Take, for example, the Ministry of Humanitarian Affairs said to have spent N500m on feeding school children during the peak of the pandemic while the kids were home.

Reconcile another sum also said to have been spent by the office of the Special Adviser to the President on the Social Investment Programme. Check the reactions attending the picture of the Humanitarian Affairs Minister, doling out bundles of cash to largely undetermined beneficiaries, some say whimsically chosen, across cities in 2020. Juxtapose this also with the brouhaha that attended the so-called social poverty register which for a while, drowned the impact of the pandemic itself in 2020, and you understand the aversion, a cross-section of Nigerians has for such programmes. Let’s not raise the politically induced trader money that finds the markets only towards major elections. All touch on the credibility of social investment management.

Such untidy exercise has the capacity to erode goodwill for a credible institution of government like the NSITF whose assignment is for all seasons and times. The negative rub-off on its core mandate of employee compensations and its ancillary, in social security, means the agency is not inured of such consequences. And nothing better illustrates this challenge than the fact that only two out of the 36 states of the federation are enrollees of the NSITF. No local government council in Nigeria is enrolled.

Yet, these are grassroots base where daily, the workforce due to the challenge of the rural environment, come face to face with hazards in the course of work. That it took the intervention of the Minister of Labour and Employment, Senator Chris Ngige, to get Federal Government ministries and some of the agencies to remit contributions owed the NSITF in 2017, speaks much of the institutional challenge the agency faces.

The unwillingness of the organised and informal businesses, housing over 90 per cent of employed Nigerians, is a crunch. And daily, are cases of workers, small and big, whose workplace challenge can find succour from the NSITF, only if the employer-companies and firms are enrolled.

The data is nothing to cheer about overall. Out of over three million employers-companies in Nigeria, only 180, 000 are registered with the NSITF, leaving out over 2.8 million others outside the social insurance net. But of these 180,000 companies, how many of them are compliant with one per cent of the staff salaries statutory contributions? Between January and December 2021, the NSITF through its regional and state offices inspected 1,811 companies and established debts to the tune of N2.3 billion out of which only 26 million was recovered between January and December 2021.

While on the cumulative, that’s those owed prior to the year, N340m was recovered. However, the debt profiling to ascertain the actual quantum of debt owed the agency goes on.

Nonetheless, the relevant question is whether the agency has done enough to earn the trust of the investor public, knowing its inglorious past. Again, here is where the management strives to distinguish and move away from the trajectory hitherto. Between June and November 2021, the agency paid N529, 962,770 as claims and compensation to verified beneficiaries for medical expenses refunds, loss of productivity manhours to employers, death benefits to the next of kin, disability benefits to employees and retirement benefits on behalf of the disabled employees.

To widen the net of registration of companies, it has gone into an alliance with the Corporate Affairs Commission to access the database of registered companies in Nigeria. How does it tackle awareness creation in the backdrop of the general attitude of Nigerians towards taxation? How does it go about this knowing that the mandate of the agency still “slaps our cringing eyebrows like holy water,” apologies to poet Birago Diop in Vulture? There is a quiet strategic reform where over 300 staff of the agency have been redeployed to areas of core competence, followed up with staff internal development while stepping up advocacy visits to states and agencies.

But the needed fillip for the agency would come with the review of the establishing Act. The wing of the eagle is encumbered for a great flight. That’s the reason labour and social investment activists, raised eyes brows at the news of a so-called National Social Security and Welfare agency bill at the National Assembly when the NSITF has not been given all the legislative framework to fly.

Nwankwo-O’diwe, a social commentator, wrote from Abuja

Vanguard News Nigeria