The House of Representatives
on Thursday resolved to set up an Ad-hoc Committee to investigate the activities of National Economic Reconstruction Fund (NERFUND) and its current status with a view to justifying the planned closure.
The committee, when set up, would also probe the high profile debtors to the Fund, the condition of the projects that benefitted from the loans and the roles played by intermediary Banks and report back within six weeks for further legislative action.
The House, however, called on the executive arm of Government to stay further action on the planned closure of the NERFUND until investigations have been concluded on allegations of mismanagement in the Organisation.
The House resolution followed a motion sponsored by Honourable Bode Ayorinde entitled, “call on the executive arm of government to suspend the plan to shut down the National Economic Reconstruction Fund (NERFUND).”
To this end, he expressed concerned that “after 28 years, the Federal Government is planning to close NERFUND as a result of high Non Performing Loans (NPLs), many of which were allegedly not collateralised.”
The lawmaker also stated that management of NERFUND had, in the past year, been embroiled in an unending feud with its staff as was evident in June 2016 when the staff took to the streets, protesting an alleged mismanagement of funds.
While moving the motion on the floor of the House, Honourable Ayorinde said that NERFUND was established in 1989 to act as a catalyst towards the stimulation of rapid rise in real production enterprises in the country with a seed capital of ₦300 million.
According to him, the main objective of the Fund was to fill the gap existing in the provision of medium to long-term financing to small and medium-scale industrial enterprises (SMEs).
He added that about 2,849 projects in the Small and Medium Enterprises Sector were financed with loans from NERFUND for the total value of ₦9.5 billion as at 10 June, 2017.
He maintained that in 2002, the Federal Government merged the Nigeria Industrial Development Bank (NIDB) and the Nigeria Bank for Commerce and Industry (NBCI) to form the Bank of Industry (BOI), but NERFUND was excluded from the consolidation of the Development Finance Institutions.
The motion was passed when the Speaker, Honourable Yakubu Dogara who presided over the session put the motion to voice vote.