The Nigerian Labor Congress (NLC) has threatened to withdraw civil servants from the National Housing Fund (NHF), citing the difficulties workers face in accessing the mortgage scheme despite monthly contributions to the fund.
Congress also criticized the Federal Mortgage Bank of Nigeria (FMBN) on its management of taxpayer funds.
This was stated by the president of the NLC, Joe Ajaero, on Wednesday during an investigative hearing organized by an ad hoc committee of the House of Representatives.
The committee is investigating remittances of mandatory contributions to the NHF and the use of the fund from 2011 to date.
The 1992 NHF Act requires all employers, both in the public and private sectors, to contribute 2.5 per cent of their workers’ monthly earnings to the Fund.
Ajaero said the federal government has been deducting 2.5 percent of workers’ wages, but the FMBN often fails to notify workers about sending remittances to their NHF accounts.
He added that the administrative obstacles in the process of accessing the mortgage plan have created space for corruption in the system.
“Although the law establishes 90 days from the date of loan application to disbursement, the experiences of many workers are horrible, since the undue delay in the approval of loans forces many workers to abandon the search for the loan”, said.
He added that “many turn to third-party agencies to expedite loan applications at unofficial rates, thereby creating a perception of corruption in the home loan approval process and disbursement to workers who needed the funds.”
Mr. Ajero also informed the committee that despite the increase in the NHF’s total fund, workers are still unable to obtain housing loans.
Therefore, he called for “drastic” measures to save the mortgage system.
Bank Managing Director Madu Hamman informed the House that civil servants still contribute most of the funds, stating that the total amount of contribution from MDAs from 2011 to date is 238 billion naira, while the total individual contributions from 2011 to date is 225 million naira.
Hamman also urged the committee to give the bank time to reconcile the information requested by lawmakers.
Mr. Hamman’s request was accepted by the committee chairman, Dachung Bagos (PDP, Plateau).
Consequently, the hearing was adjourned until Thursday.
Earlier, House Speaker Tajudeen Abbas said lawmakers will consider revising the law, which he called outdated.
Abbas, who was represented by Vice President Ben Kalu, said the Chamber is committed to closing the housing gaps in the country.
“The House will examine this law that is now obsolete. From 1992 to date requires a review. There are other issues that the Chamber will inject to fit its purpose.
“As a noble initiative rooted in the principles of collective responsibility, the plan identifies the critical need to ensure access to affordable housing for working Nigerians, in order to close the gap in the housing deficit in the country,” he said.
Read More Related News Here
Let hear it in the comment below if you do have an opinion on this; NLC threatens to withdraw from the National Housing Fund