Nigerian Senate Lauds SEC on Financial Management –
The Securities and Exchange Commission (SEC) was commended for its efforts so far to bring the Commission back to profitability and urged to explore ways to further deepen the capital market to attract more local investors, especially young Nigerians.
Senate Finance Committee Chairman, Senator Solomon Olamilekan Adeola, gave his advice during the 2023-2025 Interactive Session on the Medium Term Expenditure Framework/Fiscal Strategy Paper, MTEF/FSP with the Senate Finance Committee in Abuja on Tuesday.
Senator Adeola, while commending the management of the Commission for its efforts so far to turn the SEC on its head, however, stated the need to redouble efforts to make the capital market more attractive to Nigerians.
According to him, “You have done well, I must congratulate you. I commend you on your efforts to reposition this agency from a point of deficit after paying salaries to a point of profit now and to the extent that it contributes to government coffers, I commend you.
“But going forward, there is still a lot to do at the SEC and I think you will do your best. So many people are no longer interested in the Nigerian capital market, it is running out of steam. Even though others global economies market nobody frequents them because it’s not the best of times, but I want you to see ways in which you can encourage local investors to visit our capital market.
“This is an area where you should extend your tentacles, let young people know that if they get money to market as soon as possible, they can access their profits. You did well, but there There is always room for improvement. It is this improvement that we are trying to focus on now and we believe you are getting it right now; we hope that God will guide you in your quest to turn the situation around. the SEC”.
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Speaking earlier, SEC Chief Executive Officer Lamido Yuguda told senators that the Commission is a 100% self-funding government agency and makes contributions to the federal government’s treasury under the 2020 budget bill which has amended the Fiscal Responsibility Act of 2007.
He said: “At the moment we contribute 25% to the federal government which is withheld and we are also asked to pay an additional 15% at the end of the financial year when we submit our annual accounts. That’s 40% in total, I’m saying that based on what we’ve done so far, that 40% is a bit too much for the Commission and I would like this committee to look into this.
“We have complied with the provisions of the law as we have committed the sum of 1.588 billion naira for the 6 months ending in June 2022. For the whole of 2021 we have made 1.367 billion naira and then for the 6 months of 2020, we have contributed a total of N3.705 billion from the time the deductions started”.
While admitting the Commission has recorded a major turnaround in its fortunes, Yuguda however said a 40% contribution to the CRF might be too high for the SEC and urged senators to take a second look.
“We were able to cope with the 25% from the start, but the additional 15% was actually very difficult for us. We are coming out of a loss position, when the bill for the 15% came, the Commission had already spent the balance of the 75% that we could keep as overhead.
“The Commission is doing a lot to bring more Nigerians into the market and we have achieved a lot in this regard. We know that the capital market can do a lot to help the government in its current efforts to reposition its finances and the economy,
Yuguda, who said the Commission was operating under very difficult circumstances as it currently monitors a market which has been affected by the negative impact of the coronavirus pandemic, however assured that steps were being taken to ensure that the fortunes of the SEC continues to improve.
He revealed that the Commission collects revenue from the market to fund its regulatory activities in the market, but however warned that if these fees are too high, they will discourage the raising of capital and discourage participation in the capital market, saying that there must be a good balance between asking the SEC to raise revenue to finance its activities and asking the SEC to also pay revenue into government coffers.
He said: ‘If we review the medium-term expenditure framework that we launched last year, if we look at 2022 and 2023, you will see that we have worked on our expenditure and done a lot of financial management to improve the situation. fortune of the Commission. So we need everyone’s support to organize the kind of transition we’re thinking about at the SEC.