*As Armed forces reject N100bn fund to tackle insurgency
By Tordue Salem
The House of Representatives Monday disclosed that only a paltry nine percentage of billions of dollars spent on armed forces is spent on the purchase of arms to battle insecurity in the country.
The House, through the Speaker of the House, Femi Gbajabiamila, made the disclosure at a public hearing on a proposed law to compel the thirty six states of the federation, Federal Inland Revenue Service(FIRS), Airlines operating in Nigeria, Nigeria Sovereign Wealth Fund and sundry grants from agencies to provide funding for the Nigerian Army, Navy and Airforce to effectively battle insecurity in the country.
According to the speaker, “It is my pleasure to speak at the Public Hearing on the Armed Forces Support Trust Fund (Establishment) Bill, 2021 which is being held today. The importance of this bill is evidenced by the dwindling resources available to the Armed Forces of Nigeria to prosecute the various security operations it is involved in. This requires innovative ideas to raise additional funds without placing any burden on Nigerians, in support of the Nigerian military. Thus, the idea of this
“ This Bill seeks to provide an injection of additional Capital funding for the Armed Forces of Nigeria at a crucial time in our nation. I am sure many of you will wonder why the Armed Forces of Nigeria need an additional financial injection at this time.
The fact based on appropriation records is that about 91% of the current funding to the Armed Forces go on recurrent overhead, salaries and welfare, leaving only 9% for capital purchases. This reality has prompted this 9th House of Representatives to seek a way of providing funds that will be focused on the Capital needs and training of our Armed Forces. Nigeria’s expenditure on military hardware and training in the last five years hovers between a paltry nine to eleven percent of the total annual budgetary allocation to the Armed Forces.
“This is grossly incapable of empowering the military to face the security challenges in the country especially the insurgency in the North East. To succeed in this fight, the Armed Forces of Nigeria requires more funding for modern weapons and required trainings. Spending on military hardware must definitely increase to support the zeal and commitment already being exhibited by our soldiers.
The Armed Forces Support Trust Fund (Establishment) Bill, 2021 is a time limited endeavour to upgrade the equipment infrastructure of our Armed Forces in a deliberate manner that will better position them to be more effective in securing the nation.
The myriad of security challenges facing the country has continued to dwarf every developmental effort put in by the government”,
According to the helmsman of the Green Chamber, “ Indeed, development is at the heart of security and as Kofi Annan puts it, “Development and security are inextricably linked.” If Nigeria must develop, we need to get our security estate right by ensuring that our military is adequately equipped and well- trained.
This requires funding which cannot be sourced solely through the annual budget provisions.
“This Bill has been crafted in ways that does not impose any direct additional burden on Nigerian citizens and businesses, but creatively make funds available through deductions from statutory receipts of the Federal Government as well as voluntary donations”.
Distinguished colleagues, ladies and gentlemen; I am happy to support this Bill because it will help reposition our military capabilities in ways that can only strengthen our National security. I agree that the solutions to our insecurity as a nation will not only be by military powers alone; but also, by non-military engagement “
“That is why next week, the House of Representatives is hosting a Five-Day Special Summit on National Security. This Summit will take an All-Nation and All-Government approach by examining extensively non-military solutions to our insecurity. From challenges with Food security, Environmental changes, Economic development, Criminal Justice reform and other non-kinetic engagements.
“But even with these extensive and wider examination of our security challenges; we cannot exclude the need for and benefit of a well-equipped and better trained military in the fight against all forms of insecurity.
It is a historic fact that countries during war times, do not fund their military through regular appropriation alone.
From the USA, to the United Kingdom and all Western powers; their military was funded through extra budgetary means during periods of war. Nigeria is at war against insurgency, terrorism, kidnapping and all manner of insecurity; hence the need to uplift the resources available to our Armed Services to enable them procure the best tools to help win this war. So, what we seek to do in this Bill is not new or unique to us as a nation.
The solution to our security challenges requires asymmetric actions across many policy areas. This is what we have tried to do as the representatives of the people.
The concept of a Trust fund already exists for the Nigerian Police. It only makes sense to also bolster our military capability as well through this unique vehicle. In this Bill; the Board of the Trust Fund is full of eminent Nigerians from all walks of life; this should give confidence to all of the depth of knowledge and experience that will be available to manage this fund. The National Assembly will equally play its part in oversighting this work of this Trust Fund.
Let me reiterate the 9th House of Representatives’ commitment towards ensuring the protection of lives and property. We have echoed this severally in our Legislative Agenda and through various legislative processes undertaken or currently going on in the House.
I want to use this opportunity to solicit your support for the House of Representatives as we embark on this Public Hearing. This House takes Public Hearings very seriously as it presents an opportunity for you, our people, to enrich the legislative process with your suggestions, contributions and ideas. I therefore urge you fully participate in the Public Hearing as all your contributions will be taken seriously by the Committee.
Today’s Public Hearing is part of our legislative process for all new Bills. I will like to thank all of you for coming and I am sure all your views and perspectives will help enrich the production of a final Bill that we all can be proud of.
Thank you all for coming and I wish you all a happy deliberation”.
DHQ: Proposed N100bn Armed Forces Support Trust Fund Inadequate to Address Insecurity
The Defence Headquarters however stressed that the N100 billion proposed by the Armed Forces Support Trust Fund Bill grossly insufficient would to tackle the worsening insecurity in the country.
The Director of Production, Defence Headquarters, Air Vice Marshall M. A. Yakubu, said with the new exchange rates were making it difficult to fund procurement of equipments.
He said the United States was unwilling to sell equipment without a three-year minimum package.
”There must be training and other things. That total package came to that amount. How many years would it take you to budget. The maximum we have received from 2017 to date we have received in capital allocation for the Air force was about N44 billion per annum. Convert that at the current exchange rate. How many years do you need to gather 500 million dollars to buy just 12 aircrafts? Look at the expanse of land we are required to cover? Nigeria is over 920, 000 square km. Every inch of the land needs to be covered by either surveillance or capability to attack.
”About two weeks ago we had a brief discussion of what we intend to generate from this. We are estimating something in the range of N100 billion per annum. Convert that to dollars because virtually all the equipment are imported.
This will go nowhere. And it would not address the problem we are seeking to address unless we expand the sources. Nobody wants to sleep with only one eye closed. Everybody is scared of traveling on the road because of insecurity. Therefore I would urge that all stakeholders must educate citizens to understand the need to sacrifice because if we do not do that to address this problem sincerely speaking would continue to be a mirage.”
He also called for a review of the percentages that would be embedded in the trust fund.
“If we are not able to raise a minimum of $2 billion dollars per annum in the next three years for a start, subsequently maybe we can begin to taper down the percentages. But for a start we need a bulk sum because of many of these manufacturers of equipment require 100 percent down payment to even start production. So you cannot sign a contract example with the US manufacturers and pay 15 percent mobilization as required by the procurement act. Nobody would look at you. Their terms must be followed. Many times we are asked to pay 100 percent,” he added
Also, the Director General Defence Research and Development Bureau, Air Vice Marshall U. P. Uzezi urged that research and development be taken more seriously so required military hardware can be produced locally.
He said, “This bill is very needed at this point in time in the history of our country, bearing in mind the national security challenges we are facing. I was thinking to myself how are we going to achieve this local production without adequate research that is being done to encourage local production. I did not find one. Of course it is implied in the bill but not explicitly capture. I thought that R and D should be included as one of this priorities in this Bill. Explicitly captured.
“There are many research institutes but they have suffered and they have been able to achieve a lot because of this singular of inadequate funding. I believe that that bills when passed to law it would support the bill that is coming forth for the defence, research and development bill, which i also think is a good thing. I want to plead with the committee to include particularly in the establishment of the fund under the utilization of the fund section 3, that R and D be captured.”
Responding to the stakeholders inputs, The Chairman of the Committee and the Bill’s sponsor, Hon. Babajimi Benson assured that going forward, all concerns raised will be addressed.
The Chairman of the House Committee on Defence, Rep. Babajimi Benson in his welcome address at the hearing for the “Armed Forces Support Fund(Establishment) Bill, 2021”, said “the bill seeks to explore alternative sources of funding for the Armed Forces of Nigeria in addition to the annual budgetary allocations. The need for alternative/additional sources of funding for our Armed Forces has become even more apparent considering the myriad of security challenges facing the country”.
According to him, “Also, only approximately 9 percent of annual budgetary allocation is available for capital expenditure. A large chunk goes for recurrent expenditure. This bill, is therefore very crucial for our Armed Forces and thus, the calibre of its sponsors”.
He said “Currently, the Armed Forces of Nigeria receives its funding mainly through the annual appropriations made by the National Assembly. In recent times, the Armed Forces of Nigeria has continued to expand both in terms of personnel and the provision of platforms, weaponry and equipment to sustain its ever-increasing operations. Efforts in the past by the Armed Forces of Nigeria to procure the needed military hardware and provide requisite training to meet the challenges currently being faced has hit the brick wall due to limited financial resources. This also underscores the immense importance of this Bill”.
The bill seeks a law that will set aside for the armed forces, “An amount constituting one percent of the total money accruing to the Federation Account, 0.5 percent of profit made from investment of the National Sovereign Wealth Fund (NSWF) by the Nigerian Sovereign Investment Authority (NSIA), An amount constituting one percent of Value Added Tax (VAT) remitted to the Consolidated Revenue Fund (CFR), Any take-off grant and special intervention fund as may be provided by the Federal Government, states and local governments of the Federation, An amount constituting one percent of the government revenue from air ticket contract, charter and cargo sales charges to be collected by the relevant agencies and paid over for the benefit of the Trust Fund, Voluntary aids, grant and all assistance from friendly, scrupulous and trustworthy international agencies, non-governmental organizations and the private sectors as determined by the Board.
4Money derived from short term investments made by this Trust Fund, An amount accruing from Annual National Fundraising as may from time to time be conducted by the Board to raise funds from interested donors”.
The bill adds that, and “Such moneys as may be appropriated by the National Assembly during the budget process to meet the objectives of this Bill”.
The Bill also states that “ The Federal Inland Revenue Service (FIRS) shall be responsible for the collection of the funds and remittance to the Trust Fund”.
It however warns, that “All funds received by the Fund, shall not be spent until it is appropriated by the National Assembly and approved by the Trust Fund; except Donations and Gifts which shall be accounted for Biannually by the Board to the National Assembly”.
The fund, according the bill is for the purpose of the purchase of weapons against insecurity.
Section 3(1), states that “The Trust Fund shall be utilized: For the purchase of modern and State of the Art military equipment and other machineries for the Armed Forces of Nigeria.
(ii) For continuous training and acquisition of knowledge and skills by the personnel of the Armed Forces of Nigeria for improved proficiency in the use of modern operational equipment and machineries.
(iii) For the enhancement of the skills of the Armed Forces of Nigeria personnel for improved proficiency.
(iv) For such other purposes incidental or connected to the attainment of the objectives of this Bill”.
The proposed law adds that “(2) In utilizing the funds for the purchase of equipment and training, the Fund shall request any technical inputs from the Armed Forces of Nigeria and an understanding of the cost implications of any proposal”.