Bill to ensure compulsory saving from revenue into NSIA scales second reading

A bill for an Act to amend the allocation of revenue from the federation account, Act CAP A15 LFN 2004 and for other related matters, 2020 (SB.416), has passed the second reading on the floor of the senate.

The bill, moved by Albert Bassey Akpan, lawmaker representing, Akwa Ibom North East senatorial district, is to allow the inclusion of the Nigerian Sovereign Investment Authority (NSIA) as beneficiary of monthly distribution of revenues accrued in the federation account on a first-line charge.

During the session on Wednesday, Solomon Adeola, senator representing, Lagos West, said the bill is to safeguard the future by saving, adding that the mandate of the NSIA is to serve as a reservoir for the nation.

According to Adeola, the Buhari administration has set aside funds as savings for the future, and making the NSIA a first-line charge beneficiary of the federation account for the funds to be invested on government’s behalf is “a right step”.

Enyinnaya Abaribe, lawmaker representing Abia-South senatorial district, in his contribution said the bill is 47 years late because the country ought to have started saving, but added that “it is never to late to start.”

On her part, Biodun Olujimi, lawmaker representing, Ekiti South, said she supported the bill, adding that when it becomes law, all the clauses are protected and implemented.

Gabriel Suswam, lawmaker representing Benue North-East senatorial district, who also supported the bill, pointed out a clause regarding 20 percent of allocation, less 13 percent derivation, and advised that deduction must be inclusive of the 13 percent derivation for all states.

The bill has been referred to the senate committee on national planning and economic affairs and national identity card to report back in four weeks.

The NSIA manages the Nigeria sovereign wealth fund, into which the surplus income produced from Nigeria’s excess oil reserves is deposited.

Part of the fund mandate is to provide stabilisation support to the Federation revenue in times of economic stress

In 2012, state governors across the country had approached the court to challenge what they termed ‘illegal deductions’ by the federal government.

The supreme court had earlier advised the parties in the suit to settle out-of-court, but the governors, apparently dissatisfied with the continued deduction of their allocation by the federal government to fund the oil subsidy, decided to return to court.