From Adanna Nnamani, Abuja
Despite facing numerous socio-economic challenges and shifting paradigms, the National Social Insurance Trust Fund (NSITF) has demonstrated unwavering commitment to improving the welfare of Nigerian workers. Operating under the Ministry of Labour and Employment, the NSITF is mandated by the Employees Compensation Act of 2010 (ECA, 2010) to provide comprehensive compensation and rehabilitation services to employees and their registered beneficiaries in cases of workplace injuries, disabilities, occupational diseases, and fatalities. The Act assigns the NSITF the task of managing a solvent compensation fund for employees and employers while implementing effective measures to enforce occupational safety and health standards to prevent workplace accidents.
In line with the provisions of the Employee Compensation Scheme (ECA, 2010), all employers of labour in the public and private sectors of the Nigerian economy are required to remit 1 per cent of their total monthly payroll to the NSITF for the Employees’ Compensation Scheme (ECS).
Under the leadership of the Managing Director, Maureen Allagoa, the NSITF has made significant progress in fulfilling its mandate, aligning with President Bola Tinubu’s 8-Point Agenda for Social Security. Over the past year, the NSITF reached over 20,000 Nigerians with various social security benefits, significantly increasing its outreach, particularly within the informal sector. This expansion marks a substantial leap from aiding 103,000 injured workers over 12 years to dispensing claims and benefits to 20,531 people within a single year.
The Fund has also undertaken initiatives to extend social security services to the informal sector by collaborating with SMEs and associations, including those in the agricultural sector, to boost productivity and ensure food security. Additionally, the NSITF conducted over 5,500 Occupational Safety and Health exercises aimed at reducing workplace accidents and ensuring a safer work environment across various sectors.
This proactive approach reflects the Fund’s commitment to accident prevention and overall employee well-being, aligning with the core objectives of the 8-Point Agenda. Through strategic partnerships and innovative programs, the NSITF has increased awareness about the importance of social insurance and improved accessibility to its services.
Moreover, the NSITF has implemented reforms to enhance transparency and efficiency in its processes, ensuring timely delivery of benefits to those who need them most. The ongoing digitization of the Fund through the E-NSITF is aimed at enhancing transparency, accountability, and operational efficiency, ultimately speeding up turnaround times and providing operational convenience to its customers.
The Fund’s dedication to excellence and service has been recognized through various awards and accolades, underscoring its impact on the lives of Nigerian workers. In 2023, the NSITF won the prestigious NECA Award in the Best Service Delivery Category.
Recognizing the pivotal role of skills development in enhancing productivity and job security, the NSITF rolled out targeted training and capacity-building programs for its staff, equipping them with the necessary skills and knowledge to thrive in today’s dynamic labor market. The Fund achieved an unprecedented 98 per cent of its target in 2023, with the MD expressing confidence that this record will be surpassed in 2024.
Speaking at a recent regional workshop, Allagoa stated: “Yes, I dare say target-surpassing 2024, because of the unprecedented achievement in 2023. Let me use this opportunity to congratulate you all on the achievement of Employee Compensation Scheme (ECS) contributions in 2023 which is the highest collection figure in the history of the Fund.”
The Managing Director also announced new operational policies and strategic action plans, including the adoption of ECS compliance certificates as part of bidding requirements for contracts in the states of the federation, the harmonization of ECS central databases in all branches and regions to prevent double registration, aggressive registration of new employers, segmentation of all coverage areas to ensure effective enforcement, and the intensification of occupational safety and health awareness to reduce workplace accidents. Additionally, all staff are required to participate in at least one training session annually.
The Fund’s Executive Director, Finance and Investment, Adegoke Adediji, clarified misconceptions about the NSITF’s mandate, emphasizing that the successes of the Fund cannot be solely measured by the amount paid in claims and compensations. Effective occupational safety and health (OSH) programs are designed to slow down workplace accidents.
“A well-managed NSITF primarily seeks the reduction of workplace accidents,” he stated. “If accidents occur, we follow up with rehabilitation and then payment of claims and compensations where necessary. The NSITF has been discharging all obligations on the payment of compensations to employees and their dependents for death, injury, or disability arising out of or in the course of employment. We rehabilitate those who suffer workplace disabilities.”
Adediji also affirmed that the current management has a clear roadmap for the future of the Fund, stating that the NSITF is evolving with the times in terms of rules and operations.
The NSITF has undergone significant reforms aimed at enhancing staff capacity and welfare. In 2022, a corruption-free, computer-based promotion examination was introduced, resulting in the promotion of 1,032 staff to various cadres and 129 to management positions. In 2023, 1,671 staff were promoted, with pending promotions for management awaiting ministerial directives. Additionally, the staff performance evaluation transitioned from APER to a more practical Performance Management System.
The management also reviewed the Staff Conditions of Service, which had been unchanged for 29 years, and implemented a new integrated salary structure approved by the National Salaries, Incomes, and Wages Commission. The minimum wage award of N35,000 was promptly paid, and a new health management plan was instituted to improve medical care for staff and clear gratuity backlogs.
To extend the Fund’s reach and benefits, four new branch offices and service centers were established, with a focus on the informal sector, where many Nigerian workers earn their livelihoods.
The remarkable achievements of the NSITF have garnered praise from Babatunde Ogunlade, President of the Nigerian Council of Registered Insurance Brokers (NCRIB), who lauded the Fund for its efforts in expanding social security services nationwide. He emphasized the importance of compliance with the Employees’ Compensation Scheme and noted the increasing recognition of NSITF’s operations. Ogunlade expressed readiness to collaborate with the NSITF to onboard more SMEs and strengthen engagement with the community of registered insurance brokers across the federation.
Despite these accomplishments, the NSITF faces challenges impeding the fulfillment of its mandate. One significant issue is the designation of the Fund as a revenue-generating agency under the Fiscal Responsibility Act 2020, subjecting it to a 50 per cent automatic deduction from internally generated revenue. In 2022, 40 per cent of the Fund’s contribution inflow, amounting to N1.4 billion, was deducted under the requirements of the Fiscal Responsibility Act. This affects its operations, and the request for the removal of the NSITF from this list is still pending before the National Assembly and relevant ministries, with social partner NECA making similar efforts from the back end.
Moreover, there is a loophole in the establishing Act regarding claims and compensations, exploited by unscrupulous employers in the informal sector. Amendments are needed to address this issue. Additionally, enforcing a 1 per cent deduction from total remuneration as per the ECS, instead of 1 per cent of Basic, Housing, and Transport (BHT), remains a challenge despite updates by NECA. Furthermore, obtaining approval for regulations to the ECA 2010, as authorized by the Act, is crucial for effective mandate implementation.
The NSITF has consistently been a target of public scrutiny, especially due to past leaderships that tarnished its image. Recently, a Civil Society Organisation urged anti-graft authorities to investigate alleged fraudulent activities and misconduct within the Fund. The agency has dispelled these claims with facts, clarifying that such allegations were baseless and unfounded. The NSITF has maintained that its books have been open to public scrutiny since the current leadership came on board in 2023.
“The truth is that the NSITF at the moment is probably one of the most scrutinized agencies of government, and no verdict of guilt has been established beyond the usual nebulous tattletales and beer parlour gossip that lack logic and facts,” the MD said in one of her statements.
Through these efforts and reforms, the NSITF continues to strive towards enhancing the welfare of Nigerian workers, ensuring their safety, and promoting a more productive and secure labour environment.
