Rep frowns at executive order to wind NERFUND

A member of the House of Representatives Emeka Anohu( Ihiala Federal Constituency, Anambra State) has urged the Federal Government to exercise caution on its decision to wind down the National Economic Reconstruction Fund ( NERFUND) and merge it with the Bank of Industry (BOI).

Anohu who is Chairman of the House of Representatives Ad-hoc Committee investigating the activities of Development Finance Institutions (DFIs) in Nigeria, frowned at the executive order to wind down the operations of NERFUND, noting that it would be detrimental to the nations economy and rather increase the number of unemployment in the country.

Speaking on the development, the Lawmaker suggested that NERFUND should be reorganized and repositioned to be able to provide the needed result.

We must address what went wrong , let’s streamline the activities of DFIs in the country including BOI, Bank of Agriculture and NERFUND to produce maximum effect on our People,” he stated, adding that they should be restructured through models that will work, as closing them down is bot the best.

Anohu’s ad-hoc committee has for sometime been conducting investigation into the activities of federally owned DFIs in Nigeria including NERFUND which was set up in 1999 by an Act of the parliament.

Recall that NERFUND has for awhile, ceased to carry out it’s mandate of providing funds for the Small and Medium Enterprises due to high non performing loans which rendered it comatose.

As a result, the Federal Government recently issued an executive order to wind down its activities and merge it with the Bank of Industry.

Although Anoku agreed that the ad-hoc committee investigation showed that contrary to the laudable purpose for which NERFUND was set up which is to provide funds to MSMEs, which remains largely unachieved, he said that the MSMEs will​ still require cheap funding from the government, which can be better provided through agencies like BOI, NERFUND, BOA and the likes.

The failure of NERFUND like it’s other counterparts was due to poor management over the years, diversion of funds to cronies, poor business models that could not support its operations and paucity of funds,” Anohu explained.

He however emphasized that inspite of the challenges, shutting down NERFUND is not the solution, he said that the agency should be reorganized and positioned to discharge its mandates​ to the economy. ” Nigeria is in need of interventionist agencies like NERFUND, therefore shutting the existing ones rather than restructuring them is certainly not the best way out. What happens to its staff?