By Bimbola Oyesola
Times are really hard in the country, and as expressed by the Acting Managing Director of Nigeria Social Insurance Trust Fund (NSITF), Ismail Agaka, the economic recession, which has hit most of the critical sectors of the economy, has dealt a big blow to the operations of the Fund.
Agaka said the reigning economic challenge has limited the NSITF reach in terms of collecting contributions from employers.
However, despite that, he stated that the Employees Compensation Scheme (ECS) since inception five years ago, has had 45,000 companies registered, moved from zero claim settlement and compensation to over N700 million; and from zero beneficiaries to over 6,000 beneficiaries.
He explained that the scheme was informed by the need to ensure injured workers are no longer abandoned to their fate which, he noted, would boost productivity and national economic development, as workers would be able to give their best when safety is not compromised.
The NSITF boss equally speaks on the expansion plan of the scheme as well as plans to motivate employers of labour both in the private and public sectors for continued contribution to the scheme.
Excerpts:
The scheme
Generally we have moved form zero registration to 45,000 over the past five years. Specifically, over the past eight months, we moved from 40,000 to 45,000. In terms of claim settlement, we have also moved from zero claim settlement and compensation to over N700 million as at today. We also moved from zero beneficiaries to over 6,000 beneficiaries. So, that is the way to assess our performances over the last five years.
Though we could have done better than that, our major challenge is that we have not sensitised the public enough. But we are now embarking on an aggressive enlightenment of the public including the trade unions and employers of labour. We are also talking to the state governments to explain the benefits of the ECS. Also, the reigning economic challenge has limited our reach in terms of collecting contributions from employers. There are some employers that had to close shop among those that have registered while those that have not closed shop have had to reduce their workforce drastically. All of these are factors that are inhibiting the expansion of the scheme.
There is no doubt that the economic recession has really hit some of the critical sectors of the economy very hard. For instance, some have been forced to reduce staff while those that have not, have had to reduce staff remuneration because contribution is a function of the payroll of organisations. Therefore, the reduction of staff or their salaries will affect the amount of contribution into the scheme directly.
NSITF mandate
There is a bill in the National Assembly for the amendment of the NSITF Act for it to execute other programmes apart from the compensation scheme. That bill has gone very far in the legislative process. What we are waiting for now is the public hearing on it.
State participation
Bauchi State is already registered on the scheme and will soon begin contributing. The process of its contribution is still in the works and we expect the details to be finalised very soon.
We have received invitation from many states to make presentation on the scheme. We have met with the Lagos State government officials and are now in the process of getting them registered on the scheme. The management is talking with Edo and Zamfara states with a view to getting them on board soon.
But we are present in all the states of the federation. We have 67 offices nationwide that include 11 regional offices, 55 branch offices and the headquarters. So, we are in every state of the federation. While it is desirable to be present in all the 774 local councils in the country, the scheme is still young to be present in all the councils. Any rush to increase our presence in every local council will mean we would not build reserve. A social security programme cannot be run without building a very robust reserve. We intend to expand our presence in all the states of the federation but we have to be strategic in doing so.
Air crash victims
First, if the employer of a victim of plane crash or any accident is registered, the survivor of such a victim would be compensated. Secondly, the journey must be in the course of carrying out official duty. If it is confirmed that it was an official trip in the course of work, then the next of kin or the dependant of the deceased employee is covered. Many such claims have been processed by NSITF.
The Act recognises up to four children. We also have a formula to determine entitlements depending on circumstances of the accident. When that is computed it is then paid regularly to the beneficiary. That is the case of the breadwinner being deceased. We have a family whose breadwinner died and after the computation of the entitlements, we are now paying up to N1.3 million monthly to the beneficiaries. That represents 90 per cent of the last income of the deceased breadwinner.
Compensation
If accident occurs in the workplace, the employer owes his or her employee the duty of care by offering that employee at least first aid treatment. It is after the stabilisation of the worker that the office now reports to the NSITF and then the process begins. Whatever medical expenses that might have been incurred prior to reporting to the NSITF is refunded. If there is any need for the employee to obtain further rehabilitation as the case may be, it is the responsibility of NSITF. But the first point is that the employer must be registered on the scheme and also the accident must be reported to the Fund through a laid down procedure.
Registration
The scheme is for people that are working only and not for retirees. There is no provision for any employee to register on his own. Every worker willing to register must come through an employer because the scheme is employers’ obligation. Everybody is exposed to one form of occupational hazard or the other in the workplace. So it is not a question of ‘it does not concern me’.
Joining this kind of scheme boosts the morale of employees without mouthing it. Boosting the morale of employees is more than just increasing the salaries and allowances. It is this thinking that influenced the various types of benefit scheme and mortgage facilities to increase workers’ productivity.
Higher bottom-line means more money coming into the company. It will also lead to better industrial climate in the workplace. A harmonious industrial relation in the country would lead to national cohesion. The burden of care purposely by an employer, is transferred to the NSITF should there be any workplace accident, injury, disability or occupational disease. The scheme helps employers overcome unanticipated expenditure, especially if such comes when the organisation is not financially strong enough for such expenses. How do organisations address this kind of development during cash flow challenge? Such development could lead to employees seeing their employers as wicked and uncaring regardless of challenges such employer may be going through.
Contribution rate
We are in the process of reviewing our rate of contribution to reflect the risk exposure of organisation. While there is risk rating, there would also be merit rating. Merit rating is reviewing downwards the contribution of those that are regular in their contributions and are not in the habit of filling claims for compensation periodically.