By Johnbosco Agbakwuru

The Nigeria Social Insurance Trust Fund, NSITF, is embarking on a new strategy to enroll no fewer than one million subscribers as beneficiaries in the Employee Compensation Scheme, ECS, yearly.

This came as it lamented that many corporate organizations feign ignorance of the operations of the scheme.

The Managing Director of the Fund, Oluwaseun Faleye, who spoke during a briefing in Abuja at the launch of its Mass Advocacy and Sensitization Campaign, outlined some challenges facing the scheme and informed that the fund is expanding enrollment and compliance campaigns targeting informal sector workers, who make up 70 percent of Nigeria’s workforce, under the ECS’s social security protection.

Faleye lamented that some workers collude with their employers to manipulate the system, declaring lower salaries or staff strength in a bid to shortchange the Fund, describing such practices as counterproductive, and warning that in the event of accidents or death, compensation paid by NSITF under the ECS would be based strictly on the declared earnings of an employee.

He said: “Every time we’ve had the opportunity to explain what NSITF stands for and what it does, we’ve seen a swift change in perception and attitude. So, I believe the greatest challenge is the lack of understanding and awareness about NSITF’s role. This is why we are committed to deepening engagement with stakeholders. Enforcing compliance remains a major hurdle, as some employers obstruct NSITF officials during inspections of workplaces, preventing them from assessing health and safety compliance or reviewing records.

“We face challenges when our staff go on inspections. They are sometimes prevented from accessing workplaces to check compliance with safety regulations or even verify records.

“We need stronger enforcement powers to ensure organizations comply with the law, including the ability to enter or shut down premises that endanger employees’ lives.”

“Another major issue is that employees sometimes collude with employers to underreport salaries or reduce the declared number of staff, thinking they are doing their bosses a favor. In reality, they are only shortchanging themselves.

“We have seen cases where employees advise their employers to reduce their declared earnings to lower contributions to NSITF. But when accidents happen—and we pray they don’t—compensation is calculated based on the reported salary.

“So, if you undervalue your earnings, the NSITF will only compensate you based on what was declared, meaning you receive far less than you should. Employees, especially accountants, finance directors, and payroll officers, should desist from these practices because they will ultimately be the ones to suffer.

“We are developing a social safety net within the ECS that caters to Nigeria’s dynamic and diverse economy. 

Soon, we will roll out initiatives specifically for small and medium businesses, road transport workers, and other informal sector participants, ensuring they also benefit from employee compensation protection.”

He also hinted that the Fund will engage the services of the consulting firm KPMG to conduct a review of the e-NSITF project.

Recall that in 2023, the federal government approved phase two of the electronic Nigeria Social Insurance Trust Fund (e-NSITF), which will enable concessionaires to upgrade the infrastructure for N15 billion.

Faleye acknowledged that while digitalization is critical to the agency’s operations, past attempts, including the e-NSITF project awarded in 2022, have faced significant challenges.

To ensure accountability, he said the new NSITF leadership has brought in KPMG to assess the contractor’s performance against the project’s original scope.