Nigerian Govt Gives Reason For Closure Of NERFUND

The federal government has said that the closure of the National Economic Reconstruction Fund (NERFUND) was purely based on the recommendations of the Nigeria Deposit Insurance Corporation (NDIC) and the Central Bank of Nigeria’s special examination report of Sept. 30, 2013.

The Permanent Secretary, Federal Ministry of Finance, Mr Mahmoud Isa-Dutse, said this during an interview with the News Agency of Nigeria (NAN) in Abuja on Sunday.

He stated that the government took the decision to close the office because it was too expensive to run it for recovery purposes only.

He said: “No local or foreign bank would lend money to them because their balance sheet was so bad and they still had to pay salaries and overheads.

“So when government decided to wind up the company, one of the things we did was to cut on the number of staff. So we gave them a very generous voluntary exit package to keep industrial peace.

“Many of them, six contract staff and  33 senior management staff who had spent many years there took advantage of the offer and voluntarily resigned, collected their benefit and left.

“But the younger ones, of average age of 35 years stayed back and continued the recovery effort and as of the date of closure, we had 49 staff left.

“You see NERFUND was an intervention agency and not a regular or permanent one like the Central bank, NDIC or the core civil service.

“Under their terms of service, government is not obliged to transfer them to other ministries like in the civil service where you are basically guaranteed employment till retirement.”

However, Isa-Dutse said that he had written to the Head of Civil Service of the Federation, Mrs Winifred Oyo-Ita in October 2017, to appraise her of the development and solicit her intervention with the remaining staff.

“We also contacted the office of the Vice President where they have the social intervention programmes, in case they require the skills of these people. But it’s not a guarantee that they will be employed.”

He said that it was unfortunate that People misunderstood the closing down of the fund as government no longer cared about Micro Small and Medium Enterprises .

“Government especially the current administration is very concerned about diversifying the economy as contained in the ERGP. There is emphasis in the diversification of the economy and the promotion of MSMEs.

“Government have decided that NERFUND has to go because it has failed and there is BOI, CBN, DBN with bigger and better managed funds for intervention to MSMEs,’’ he said