Federal Government Pledges to Reverse NSITF Deductions Amid NLC Strike Threat

Federal Government Pledges to Reverse NSITF Deductions Amid NLC Strike Threat

The Federal Government has promised to reverse deductions from the Employees’ Compensation Scheme managed by the Nigeria Social Insurance Trust Fund (NSITF) following a threat of a nationwide strike by the Nigeria Labour Congress (NLC). The NLC had accused the government of diverting 40% of NSITF contributions to the treasury, undermining workers’ social protection .

The deductions were made based on a Ministry of Finance circular issued in December 2023, requiring government-owned enterprises to remit 50% of their internally generated revenue to the treasury. However, NSITF Managing Director Oluwaseun Faleye clarified that the deductions were not a diversion of funds but rather a misapplication of the policy .

Faleye assured that employer contributions, which fund the Employees’ Compensation Scheme, are no longer being deducted following a March 2024 directive from the Accountant-General of the Federation. Some previously deducted funds have already been reversed, and officials from the Budget Office and Ministry of Finance have pledged that no further debits will be made .

NLC Assistant General Secretary Christopher Onyeka described NSITF as a tripartite agency jointly owned by workers, employers, and the government, arguing that it should not be treated as a revenue-generating body. The union has acknowledged receipt of NSITF’s letter but will review the correspondence before deciding on the proposed strike .

The government has pledged to reverse deductions made from NSITF contributions.
The NLC has demanded the full reconstitution of the National Pension Commission board, citing concerns over pension fund management.
NSITF has denied allegations of seeking to amend the Employees’ Compensation Act to undermine workers’ rights, stating that their proposals aim to improve enforcement .

The outcome of this dispute will have significant implications for workers’ welfare and the management of NSITF funds. The NLC’s threat of a nationwide strike highlights the potential consequences of not addressing the issue promptly.