Insurers laud Govt’s provatisation plan for PHCN



Thursday, 09 Sept 2010 By Joshua Nse


THE Nigerian Insurers Association (NIA) has lauded the decision of the Federal Government to allow the private sector to take part in the transmission and distribution of electricity in Nigeria, describing the decision as a step in the right direction.

This administration’s effort at involving the private sector in the transmission and distribution of electricity will surely make the desired difference as PHCN- the state run monopoly had proved incapable of guaranteeing steady power supply to Nigerians despite the huge sums of money the government has sunk into the electricity project.

According to the Association, the Federal Government’s decision to privatise the power transmission and distribution companies is in line with the Association’s position on the Employee Compensation Bill 2010 and on other similar services provided by state agencies.

The NIA is strongly of the opinion that where the private sector is best suited to manage certain critical aspects of the economy, state monopolies should not be created as attempts are being made to resuscitate the Nigerian Social Insurance Trust Fund (NSITF), and make it a state monopoly in the management and administration of a Employee Compensation Scheme for workers.

In the Bill which is still in the National Assembly, the federal Government is seeking to make the NSITF both a service provider and a regulator of workmen compensation scheme for workers in both the public and private sectors of the economy.

In the Association’s presentation to the relevant National Assembly Committees, the NIA emphasized that since insurance companies were already providing cover for workplace injuries, diseases and death, it only requires the regulation by Honourable Minister of Labour and Productivity as enshrined in section 40 of the Workmen Compensation Act 2004 to give effect to the immediate enforcement of that law.

The Association also drew the attention of the lawmakers to the Pension Reform Act 2004 which privatised pensions and placed it in the hands of the private sector-PFAs and the National Health Insurance Scheme (NHIS) which is also private sector driven.

In articulating its position, the NIA took an in depth study of the employers liability scheme across many countries in Europe, Asia, America and Africa and concluded that privatisation of welfare schemes is what now obtains as many countries operating state funded welfare schemes are now at the brink of bankruptcy.

According to the Director–General of the Association, Mr. Olorundare Thomas, “the decision to privatise the critical aspects of power transmission and distribution is in furtherance of government’s desire to create an enabling environment for the growth of the private sector and also in line with the commitment of government to concentrate on provision of policy direction. This is the same position we are canvassing in respect of the Employee Compensation Bill.”


Source: Guardian 


Comments are closed.