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Business - April 1, 2019

NECA commends president Buhari on National Housing Fund bill

Timothy Olawale, NECA DG.The Nigeria Employers’ Consultative Association (NECA) has commended President Muhammadu Buhari GCFR, for declining assent to the National Housing Fund (Establishment) Bill 2018 that was forwarded to his Office by the National Assembly. This is in reaction to directives from the Presidency that the Bill should be returned to the National Assembly for amendment of the contentious provisions.

Reacting to this development, Mr. Timothy Olawale, Director-General of NECA stated that “the decision of the Presidency in declining assent to the Bill is laudable, a demonstration of the government’s responsiveness to the concerns of organised Businesses” and an affirmation of government’s true commitment to the Ease of Doing Business Initiative.

Speaking in Lagos, the NECA Boss noted some of the contentious provisions in the Bill as: “the insertion and introduction of a Sustainable Development Levy of 2.5% ex-factory price before transportation cost for each 50 kg bag of cement or its equivalent in bulk.” He noted the implications of this provision to include increase in the cost of building materials and the fact that companies that locally produce cement will lose market competitiveness. He opined that “Manufacturers and Businesses are already saddled with several challenges such as infrastructural decay, power, etc. Some companies are closing shops due to some of these challenges while others are still struggling to stay afloat. The proposed Sustainable Development Levy would definitely lead to an increase in the cost of doing business, and would likely be passed to the consumers whose purchasing power is already weak”. He further noted that Sustainable Development Levy is a form of VAT and our Courts had frowned against imposition of double taxes on businesses”.

Mr. Olawale also stated that in the Bill, “the contribution by Nigerian Workers was changed from 2.5% of monthly basic salary to “2.5% of monthly income” (which is total emolument). This will weaken the purchasing power of the average worker and could lead to defiance and deliberate attempt at non-compliance.”

He raised concern over the huge sanctions provisions in the Bill, of up to N100 million, among others. This could amount to the Scheme being seen as pecuniary driven, which will defeat the purpose or objective of the Housing Scheme.

As a way out, the NECA Boss urged that Government and relevant Stakeholders should reconsider the Bill with a view to amend contentious provisions.

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