Unveiling the NSITF's Strategy: Safeguarding Workers' Contributions
The Nigeria Social Insurance Trust Fund (NSITF) is on a mission to protect the contributions of its workers, and their investment philosophy is a testament to this commitment. In an exclusive interview, Managing Director Mr. Oluwaseun Faleye revealed the fund's prudent and transparent approach, prioritizing safety over profit.
NSITF, a government institution, plays a vital role in implementing the Employees' Compensation Scheme, offering social insurance for work-related injuries, diseases, disabilities, or death. Funded by employers, NSITF registers employers, collects contributions, and ensures safe working environments. Faleye emphasized that the fund's focus is on secured, government-backed instruments like treasury bills and bonds, a strategy that safeguards workers' welfare and ensures sustainability.
The law mandates NSITF to invest only in safe securities due to the nature of the fund and the need to protect contributors' money. Faleye assured that prudence takes precedence over profit in all financial decisions, with a low-risk investment appetite. While real estate investments have been made in the past, the fund's recent focus has been on very safe, low-risk portfolios, ensuring the protection of the fund for its intended purpose.
NSITF's investment decisions are guided by strict governance processes and board oversight, ensuring accountability and transparency. Every investment proposal undergoes a thorough review to ensure due process and safeguard the fund's integrity. Faleye highlighted that accountability begins with the management of the funds entrusted to them, which are meant to pay compensation when accidents occur.
The fund's commitment to transparency is evident in its decision-making process. All investments and major expenditures are presented to the board for approval, maintaining transparency at every stage. Faleye also emphasized the fund's focus on prompt payment of claims, workplace safety promotion, and strengthening social protection systems for Nigerian workers.
Efficiency in service delivery is key to demonstrating the effective use of contributors' funds, impacting lives positively. Faleye noted that NSITF operates under the Employees' Compensation Act (ECA) of 2010, which mandates employers to contribute one percent of their total payroll to the fund. Compliance with this contribution requirement is crucial for adequate funding of compensation and benefits under the ECS.
Faleye expressed his vision for full coverage of all workers in both private and public sectors under the scheme. He commended President Bola Tinubu's administration for ensuring full compliance with ECS obligations for treasury-funded federal workers, stating that secure welfare motivates workers to give their best. Looking ahead, the fund may adjust contribution rates based on industry risk profiles through data-driven engagement with stakeholders, ensuring every Nigerian worker enjoys the full benefits of the Employees' Compensation Scheme.
