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SDGs: Nigeria partners ILO on social security

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The Federal Government has joined hands with the International Labour Organisation (ILO) to promote and provide social protection for Nigerians, with a view to achieving the Sustainable Development Goals (SDGs) by 2030

Minister of State for Labour and Employment, Prof. Stephen Ocheni, made who this known at the Launch of the World Social Protection Report 2017- 2019 on Tuesday in Abuja, lamented that lack of social protection leaves people vulnerable to ill-health, poverty, inequality and social exclusion throughout a person’s life cycle.

The report had revealed that about 4 billion people in the world were left without social protection, including about 82 percent of the total population in Africa.
According to the minister, social protection was a right which should be recognised and respected by all government, as it constitutes a significant obstacle to economic and social development in society.

He stressed that the deficits of social protection in Africa especially in Nigeria, was glaring and worrisome despite its unique position at the heart of the decent work agenda.
Ocheni also noted that the launch of the report would guide Nigeria in unveiling the gaps and limitations confronting social protection coverage within its domain, as well as the measures to employ in order to achieve a successful implementation of an appropriate social protection system nationally and regionally to reduce and prevent poverty in the country.

“One thing that has been established is that achieving universal social protection is something that is possible and achievable if only we take the collective efforts and the right steps in the right direction.

“With presently about 16 up-to-date social protection standards which can guide national social protection policies and the abundant God given resources at our disposal, there is no reason why we in Nigeria or Africa or the World at large, should be lagging behind in universal social protection enhancement.

“Even in the poorest of countries, the fiscal and policy space for extending social protection for all exists and, what is required, is for Governments in collaboration and partnership with social partners to be proactive in exploring and channeling our human and natural resource endowment appropriately to promote social protection for all, especially now that all hands must be on deck to achieve the 2030 Sustainable Development Goals in terms of its social protection components.

“On our part as government, we are fully committed and will do everything within our means to collaborate and cooperate with the organisation in the discharge of our common and mutual objectives and aspirations as far as social protection for our citizens is concerned,” he said.

Delivering the keynote address, Assistant Director General and Regional Director for Africa, International Labour Organisation, Ms Cynthia Samuel-Olonjuwon, disclosed that the right to health was not yet a reality in many parts of the world.

While noting that children in Africa make up the bulk of the 1.3 billion children not covered by social protection in the world, she lamented that an estimated 10 million health workers were needed to achieve universal health coverage in Africa.

Proposing a way out, Samuel-Olonjuwon urged African governments to, among other things, undertake “deliberate efforts to increase the aggregate level of public expenditure on social protection coverage.
“We must extend social protection coverage to those in the informal economy and facilitate their transition to the formal economy are key to promoting decent work and preventing poverty. Coverage extensions can be achieved in multiple ways, the most common being a mix of contributory and non-contributory.

“An honest reassessment if short term austerity or fiscal consolidation reforms which may undermine the long term development efforts as they tend to achieve cost savings, ignoring negative social impacts with regard to coverage and benefit adequacy, and thus jeopardising advances towards achieving the SDGs,” she said.

Earlier, the Economic Community of West African States (ECOWAS) High Commissioner for Social Affairs and Gender, Dr. Alves Fernando Jorge, urged regional protection actors to work towards extending social protection to the informal sector and vulnerable people, even as he called on African leaders to heighten efforts in facilitating intraregional mobility to enhance the protection of migrant workers’ rights.

He pledged the commitment of ECOWAS towards addressing existing challenges in the provision of social protection to promote what he described as a, “modernization and expansion of social protection systems in order to provide more reliable and effective protection to as many people as possible.”

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New technology to boost Lagos’ IGR beyond N504bn in 2018

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Confronted with the challenge of poor remittance of collected taxes, Lagos State Government yesterday said it is leveraging world-class technology to boost its internally generated revenue (IGR) this year beyond N503.7 billion it generated as IGR in 2017. State Governor, Mr. Akinwunmi Ambode, said this at a forum in Lagos yesterday where it unveiled the new automation system called Electronic Revenue Assurance System (ERA) through, which it would be collecting taxes from hoteliers, event centres, eateries, among in the state. Ambode said Lagos expected that effective deployment of technology would enable the state to surpass the IGR generated by the state last year. In 2017, the total amount of IGR by the state stood at N503.7 billion (or approximately, N504 billion). The introduction of ERA is coming on the heels of a new regulation for the fiscalisation of the Hotel Occupancy and Restaurant Consumption Tax Law.

Ambode, who spoke at a stakeholders’ meeting held at Lagos House in Alausa, Ikeja to sensitize owners of hotels, restaurants, bars and event centres in the State on the new regulation, said automation of the system was introduced to address the high level of under-payment and non-remittance of what is due to government, however, assuring that it would be a win-win situation for all parties. He gave a charge on stakeholders in the hospitality industry to embrace the initiative designed to put efficient machinery in place to enhance collection process and ensure compliance.

Ambode, who was represented by the State’s Deputy Governor, Dr. Idiat Adebule, said it was important for all stakeholders to play their part in scaling up taxation being one of the ways the government is able to fund its activities and implement projects and policies for the overall benefit of the people. Addressing the stakeholders, the Governor said: “As progressive partners in the development of our dear State, we solicit for your co-operation and support at actualizing this noble initiative.

“All hoteliers, event centre proprietors, restaurant and bar owners must allow the integration of their systems along with the Lagos State Internal Revenue Service (LIRS) server to facilitate the monitoring of consumption tax transactions and remittance of same to the State.

“We must be alive to our responsibilities by paying taxes due in order to ensure the development of our dear State,” he said. The Governor said since his assumption of office, conscious efforts have been made to invest heavily in infrastructure, and that more funds were required to enable the government actualise the objective of providing adequate infrastructure and services for residents, a development he said necessitated the need to embrace the fiscalisation of the consumption tax regime.

According to him, despite harsh economy, the 2017 budget of the State performed at 82 per cent with N503.7 billion total generated revenue representing 78 per cent performance, while total recurrent expenditure stood at N281.33 billion representing 72 per cent and N387.60 billion capital expenditure representing 76 per cent performance.

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Palm oil ban: Need to plug deficit

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Recently, the Senate urged the Federal Government to ban importation of palm oil in a bid to conserve foreign exchange, as well as protect and encourage local farmers. But ironically, there is a huge gap. TAIWO HASSAN writes

 

Nigeria’s palm oil era
Indeed, Nigeria’s agriculture have suffered from decades of mismanagement, inconsistency, poorly conceived policies and lack of basic infrastructure. Sadly, a sector once known to be contributing the largest per cent to the Gross Domestic Product (GDP) and employment, is no longer attractive following the discovery of crude oil.

With the oil exploration in place, Nigeria was no longer a major exporter of cocoa, groundnuts (peanuts), rubber, and palm oil production, mostly from obsolete varieties and overage trees. Besides, more dramatic decline in groundnut and palm oil production had also taken place. Use of the oil palm fruit to extract edible oil had been in practice across the continent for centuries, and it remains an essential ingredient in most of West African cuisine.
Farmers in the region, who inter-cropped oil palm trees with other food crops such as yam and maize, started the first export trade early in the 19th Century. Before its close, the industrial revolution in Britain had created a huge demand for palm oil, which by then had found its way to use in candle making and as an industrial lubricant.

The economic importance of palm oil grew steadily because of its high yield, leading European colonists to start plantations in Central Africa by 1900. As palm oil found wider use in food-processing and industry, global demand for the commodity surged. By 1982, worldwide palm oil exports had grown to a staggering 2,400,000 million tonnes per annum.

For most of this period, Nigeria held centre stage as one of the largest producers and exporters of palm oil, accounting for more than 40 per cent of global output in the 1950s. At the time of the country’s independence from British colonial rule in 1960, palm oil contributed 82 per cent of national export revenue.

Effects of palm oil importation
However, palm oil, which used to be one of the nation’s major sources of foreign exchange in the early 1960s, is massively imported from Malaysia and Indonesia. Statistically, Nigeria currently has a global share of 2.9 per cent, with Indonesia leading by 33 million metric tonnes, Malaysia – 19.8 million metric tonnes, Thailand – 2 million tonnes and Colombia -1.1 million metric tonnes.
With GDP estimated at 970,000 metric tonnes, Nigeria requires an annual 2.7 million tonnes to make up for a 1.73 million tonne deficit. Despite a high exchange rate and price, shipment of the produce was increased by 12 per cent as its global price hit $718 per metric tonne last year.

The price of the commodity was $616 per metric tonne last July but rose to $718 per metric tonne last November based on high demand by indigenous manufacturers.
According to information, Nigeria has reportedly imported up to 4,760,000 tonnes of palm oil worth about N11.5 trillion in the last 10 years. This occurred between 2007 and November, 2017.
In 2007, the country imported 451,000 metric tonnes of palm oil and 410,000 metric tonnes in 2008. 425,000 tonnes, 435,000 tonnes and 440,000 tonnes were imported in 2009, 2010 and 2011 respectively.

In 2012, 470,000 metric tonnes of the produce were brought into the country with about 518,000 tonnes imported in 2013. The country also imported 506,000 tonnes in 2014, 263,000 tonnes in 2015, 400,000 tonnes in 2016 and up to 450,000 tonnes last November.
A total import of 4.7 million metric tonnes at the rate of $663 per tonne implies that Nigeria had, within the 10 year period, spent about N11.5 trillion on importing palm oil, which could have been produced locally.

Challenges
Investigations revealed that the problems facing Nigeria’s oil palm production include lack of adequate land space, inadequate storage facilities, which result in low production of oil palm and inadequate finance among others.
In addition, the fundamental flaw with the palm oil sector also lies in Nigeria’s colonial origins, when British trade necessities dictated economic policy. Because of its primary export orientation at that time, planned expansion of the industry was slow in coming through and its future competitiveness had been compromised. As a result, the bulk of Nigerian palm oil comes from dispersed and semi-wild groves, and through the use of highly outdated manual processing techniques.

Currently, 80 per cent of production comes from scattered smallholdings spread over an estimated 1.6 million hectares of land. In contrast, plantations occupy only about 300,000 hectares – most of it coming up in the last decade with private sector investment.

NASS’ grouse
But the recent intervention by the Senate depicts that all is not yet well with the country’s palm oil industry, as incessant importation of the commodity into the country have shown that Nigeria is losing huge foreign exchange.
For the lawmakers, calling on the Federal Government to impose a ban on the importation of palm oil in a bid to protect local production and encourage farmers should have been a cheering news.

But for a country that has about 1.73 million tonnes deficit with gross domestic production of 970,000 metric tonnes and requiring an annual 2.7 million tonnes to meet up national demand, banning the product would be nonsensical at this period.
Last week, the upper chamber of the National Assembly, t adopted a motion on the “Urgent Need to Halt the Importation of Palm Oil and its Allied Products to Protect Palm Oil Industry in Nigeria.” The motion, which was sponsored by Senator Francis Alimikhena, had lamented the rate of palm oil imports into the country.

He decried the continued importation of palm kernel and allied palm products, lamenting that it was crippling local production and depleting foreign reserves. He described the situation as inimical to Federal Government’s economic diversification policy.

The senator revealed that Nigeria imported 450,000 tonnes of palm oil estimated at N116.3 billion last year.
“Government must reverse this trend with copious investments in the local palm industry and the protection of local producers from unnecessary imports,” Alimikhena told his colleagues at plenary, last week.
He stated that Nigeria had the land and human resources to boost local production and called for efforts to regain the country’s lost position in palm oil production to create jobs and boost foreign exchange earnings.

On his part, Senator Theodore Orji called for a special fund to boost local production of palm oil, which was a major income earner for the country, decrying the moribund state of many palm oil production plants.
In their separate submissions, Senators Jibrin Barau and Rabiu Kwankwaso called on the government to ban the importation of cash crops for which Nigeria has comparative advantage.
On his part, Deputy Senate President, Ike Ekweremadu, called on the government to revive the palm oil sub-sector of the economy to create jobs and generate income for farmers.

Conclusion
Realistically, the Senate’s motion call for a total ban on the importation of palm oil will have positive impact on the local market, but the huge deficit of the commodity could cause more severe impact on Nigerians.

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N196.19bn insurance budget stirs mixed feelings

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A brighter prospect appears to be in the offing for Nigerian insurance sector considering the amount budgeted by the Federal Government to meet the life assurance premium obligations of ministries, departments and agencies (MDAs) as well as that of pensions and gratuity payment to public servants.
The amount put at N196.19 billion, is expected to spur activities in the industry the moment it is released and disbursed.

The breakdown shows that while N181.19 billion has been allocated for the payment of pensions and gratuities of public servants, N15 billion has also been set aside to meet MDAs’ life assurance premium obligations.
President, Chartered Insurance Institute of Nigeria (CIIN), Mrs. Funmi Babinton-Ashaye, believes that based on the budget, the insurance sector should experience increased business momentum.

According to her, “on the whole, the insurance industry, in my view, has more to cheer from the budget. In other words, the business outlook for the insurance industry is mixed but very promising. As players and risk managers, we need to open our inner minds and take those business decisions that will help us reposition of industry in the unfolding 2018 business year.”

The prospect is, however, dependent on government’s willingness to release the premium considering the fact that it remains one of the biggest debtors to the industry.
Series of events in the past had revealed the unwillingness of the authorities to fund insurance cover for public servants, thereby denying them or their family members any form of compensation in the event of an incident.
New Telegraph recalled that last December it was revealed that the Federal Government only paid 62 per cent premium for 2016 cover, leaving a balance of 38 per cent while it was yet to pay any for 2017.

Lamenting government’s failure to urgently pay premium for its workers, an insurance broker, Tunde Oguntade, revealed in Lagos that apart from not paying the premium in full, it was also delayed for an upward of four months from August to December 2017 before 62 per cent of the sum was paid to the selected brokers.

The group life policy is in compliance with Section 4 (5) of the Pension Reform Act, 2014, which states, “every employer shall maintain a group life insurance policy in favour of each employee for a minimum of three times the annual total emolument of the employee and premium shall be paid not later than the date of commencement of the cover.
At the beginning of 2017, a sum of N22.4 billion was budgeted as premium for the Presidency, and MDAs.

Out of the amount, the Federal Government’s life insurance had a provision for N15 billion, being the highest figure for insurance premium.
A breakdown of the amount showed that while about N22.4 billion would be spent on insurance premium, Ministry of Agriculture and its parastatals would make do with N1.9 billion.
Although the Federal Government had been slow in paying premium for both life and general insurance, the Office of the Head of Service of the Federation had hinted of the need to review the benefit of group life cover herein the insured only benefits when he is dead.

A top official of OHCSF was quoted to have lamented that the current Group Life scheme was not in tune with global best practices and as such, failed to benefit civil servants across the federation as expected.
He said the only benefits civil servants received from group life scheme was death benefit, whereas it could be extended to accidents, disabilities, residual benefits and other ancillary services.

According to him, government will review the current Group Life Assurance Scheme from an annual policy to a long-term policy for effectiveness and efficiency in order to address these drawbacks, enhance the benefits derivable from the scheme and bring the Group Life Insurance Policy in line with global best practices.

He said: “It is usually N5.4 billion annually for civil servants Group life insurance. That’s the figure and that had been recurring for the last three or four years. For this current one, I think we shortlisted 21 insurance companies, but the BPP gave us certificate of no objection for 20 and 108 insurance brokers.
“We can only work with those approved by the BPP and that approval had been confirmed by Mr. President.”

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