The bill seeking allocation from the federation account domiciled in Sovereign Investment Fund as a way of saving for the raining days, passed second reading in Senate Wednesday.
The bill seeks to amend the Act on the allocation of revenues which accrue to the federation account.
It is titled, “The Bill to Amend the Allocation of Revenue (Federation Account etc.) Act CAP A 15 LFN 2004 and for Other Related Matters, sponsored by Senator Bassey Akpan (PDP Akwa Ibom North East).
Akpan in his lead debate said the amendment would make the Nigeria Sovereign Investment Authority a first line charge beneficiary of the Federation Account for saving purposes.
He added that the amendment would also increase the funds by deducting 20 per cent of the total earnings accruable to the federation account.
He said, “The Bill seeks to amend section 1 of the principal Act to provide for additional funding for the Nigeria Sovereign Investment Authority by including it as a first line charge beneficiary of the monthly distributable funds from the Federation Account.”
According to him, the Senate had earlier proposed an amendment to section 162(3) of the Constitution of the Federal Republic of Nigeria,1999 (as amended) to provide for the inclusion of the NSWF established under the NSIA (Establishment, Etc.) Act in the distribution of any amount standing to the credit of the Federation Account.
“We had equally proposed an amendment to sections 30(1) and 47(2) of the Nigeria Sovereign Investment Authority (Establishment, Etc.) Act Cap A 15 Laws of the Federation, 2004 to provide additional funds for the SWF through a statutory allocation of funds from the monthly revenue accruing from the Federation Account.
“This is aimed at strengthening the operations and withdrawals from the SWF by the Federation to further boost the confidence of the federating units in the operations of the Fund to the benefit of all.
“The bill proposes an amount (equivalent to 20 per cent of the amount Standing to the credit of the Federation Account, less the statutory 13 per cent of the revenue accruing to the Federation Account directly from natural resources,) to be allocated to the NSIA on monthly basis,” he explained.
Senators who contributed to the debate emphasised the need for a dedicated saving culture to safeguard the Nigerian economy due to the rapidly changing dynamics and volatility of the global oil market.
The lawmakers, however called for caution on the 20 per cent deduction from to the nation’s gross earnings arguing that the country’s economy may not be able to sustain such arrangement at the moment.
The President of the Senate, Ahmad Lawan, agreed with colleagues and said such decision would be taken by stakeholders at the public hearing.
