Reps To Probe NERFUND, Urges FG to Shelve Planned Shutdown

The House of Representatives on Thursday set up an ad hoc committee to probe alleged mismanagement at National Economic Reconstruction Fund (NERFUND).

The House also urged Federal Government to suspend its planned closure, pending investigations on the alleged mismanagement.

NAN reports that  the resolution followed a motion by Rep. Bode Ayorinde (Ondo-APC).

Moving the motion, Ayorinde said NERFUND was established in 1989 to act as catalyst toward the stimulation of rapid rise in real production enterprises in the country with seed capital of N300 million.

Ayorinde explained that the main objective of the fund was to fill the gap in the provision of medium to long term financing to Small and Medium-Scale Enterprises (SMEs).

He further explained that in 2002, Federal Government merged Nigeria Industrial Development Bank (NIDB) and Nigeria Bank for Commerce and Industry (NBCI) to form Bank of Industry (BoI).

The lawmaker, however, said NERFUND was excluded from the consolidation of the Development Finance Institutions.

He added that “about 2,849 projects in SMEs sector were financed with loans from NERFUND, totalling N9.5 billion as at June 10, 2017.”

According to him, the vision of NERFUND is to build world class development finance institution anchored on professionalism, integrity, transparency and quality service delivery.

He expressed concern that after 28 years, Federal Government was planning to close NERFUND as a result of high non-performing loans (NPLs), many of which were allegedly not collateralised.

Ayorinde further expressed concern that the management of NERFUND had in the past been embroiled in unending feud with staff as was evident in June 2016.

He added that this was when the staff took to the streets, protesting alleged mismanagement of funds.

Contributing to the debate, Rep. Munir Agundi (Kano-APC), stressed the need to halt the closure of NERFUND and look into its books to ascertain the cause of its near collapse.

The motion was unanimously adopted when it was put to voice vote by Speaker Yakubu Dogara.

The house, therefore, resolved to set up ad hoc committee to investigate the activities of the fund and its current status to justify the planned closure.

The committee is expected to identify the high profile debtors to the fund, the condition of projects that benefitted from NERFUND loans and the roles played by intermediary banks.

The committee is to report its findings within six weeks for further legislative action.

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