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DisCos Owing N230bn Due To Inefficient Collection System, Under Remittance – NEC

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The ad hoc committee of the national economic council (NEC) says distribution companies (DisCos) owe the electricity market N230 billion as a result of inefficient collection system and under remittance.

This is contained in the committee’s report submitted to the NEC presided over by Vice-President Yemi Osinbajo in Abuja on Thursday.

The NEC had appointed Nasir el-Rufai, governor of Kaduna state, as head of the ad hoc committee that will review the ownership of the DisCos.

The report said the DisCos made underinvestment of N164 billion (67 percent) into their network between 2015 and 2018, which is below their performance agreement target.

Speaking with journalists at the end of the meeting, Abdullahi Sule, governor of Nasarrawa state, said the DisCos made N147 billion from investments on their networks by the Niger Delta Power Holding Company (NDPHC) and the Rural Electrification Agency (REA).

“Excluding tariff shortfall (responsibility of federal government), DisCos’ indebtedness to the electricity market amounts to 230bn. This includes 48bn of MDAs indebtedness to DisCos. DisCos indebtedness is driven by collection shortfall and low remittance,” he said.

“Between 2015-2018, Discos under-invested relative to their performance agreement target by 164bn (67 per cent) and benefit from investments by NDPHC/REA in their networks to the tune 147bn.

“Board composition across Discos is disproportionately skewed towards private investors while states and LGAs have no representation. While on reform revitalization, the presentation stated that the EPSRA established a good framework for driving the reform, through a multi-stage competitive approach, the establishment of an independent regulator, and mechanism to protect the poor.

“The sector has underperformed due to critical challenges which include non-implementation of cost relative tariffs, misalignment between the investors and BPE on required investment in DisCos, underinvestment in infrastructure and poor implementation of rules/ contracts.

“Urgent measures needed to turn the sector around include recapitalization of DisCos, firm implementation of industry rules/ contracts and the insistence on sound governance principles that improve performance.”

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Nigeria Set To Host AIO Confab, As Tope Smart Emerges President

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By Sola Alabadan

All arrangements have been concluded for the forthcoming 47th Conference and Annual General Assembly of the African Insurance Organisation (AIO) holding in Lagos from September 4 to 8.
Chairman, Local Organising Committee Of AIO 2021, Mrs. Ebelechukwu Nwachukwu, who addressed journalists in Lagos on Tuesday, said since the conference could not hold last year due to the covid-19 pandemic, the AIO Secretariat LOC decided to hold it this year as a hybrid event to cater for those who will not be able to attend physically.
She emphasised that in planning the conference at this time, the organisers  have taken full cognizance of all the health protocols and restrictions on public gathering, hence the decision to make it a hybrid event.
To give further impetus to this decision, she pointed out that “we are limiting the number of physical attendees, while others are being encouraged to take advantage of the virtual conference to participate from their different locations. For physical attendees, all covid-19 protocols will be observed and implemented to the letter.”

She also commended the Commissioner for Insurance, Mr. Olorundare Thomas for working assiduously and liaising with the various ministries and agencies to ensure that the organisers get the full support from the government.
She equally informed that of the major highlights of the 47th Conference is that the immediate past chairman of the Nigerian Insurers Association and Group Managing Director of NEM Insurance Plc, Mr. Tope Smart will assume office as the next president of the pan African organisation for the next one year.
As Covid-19 pandemic had left very debilitating effects on many economies and there are efforts at addressing these challenges, participants at the 47th AIO conference would be contributing to discussions around how insurance can contribute to ongoing efforts at rebuilding economies seriously impacted by the pandemic.
The theme of this year’s conference is: Rebuilding Africa’s Economy: An Insurance Perspective.

The four other subtopics to address other contemporary issues affecting the insurance industry are:
The new normal: How leaders can reset for growth beyond covid-19
Regulation, innovation and the future of insurance

Harnessing the potential for growth and development in the Nigerian insurance market

AfCFTA and the African Insurer: Prospects and Opportunities

She added that the AIO Secretariat has assembled a strong faculty to deliver the different papers.
The resource persons are: Mr. Jakkie Cilliers, Institute of Security Studies, South Africa, Mr. Belhassen Tanat of Munich re, Mr. Yinka Sanni of Standard Bank Group, Mr. Tawiah Ben- Ahmed of Metropolitan Life Insurance, Ghana.
The AIO conference will also include the Life Seminar and all related activities.
The LOC chairman further stated that hosting the conference is significant to Nigeria, as it will enable her to showcase hee rich culture and hospitality, as well as provide a great opportunity to correct some of the misconceptions about Nigeria and her people.

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Banks’ CEOs Hold Emergency Meeting Over BDCs’ Forex Ban 

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Bank Chief Executive Officers on Thursday, held an emergency meeting on how to ensure compliance with the new forex directive of the Central Bank of Nigeria.

After the meeting, they spoke during a webinar organised to give an update on the banks’ preparedness to be the main channel of forex distribution, following the recent discontinuity of forex supply to the BDC operators by the CBN.

The executives assured the public that banks would make forex available to customers in accordance with the CBN’s directives.

After the last Monetary Policy Committee meeting, the Central Bank Governor, Godwin Emefiele, had ordered all Deposit Money Banks to set up teller points at designated branches across the country to fulfil legitimate FX request for personal travel allowance, business travel allowance, tuition fees, medical payments and SMEs transactions, among others.

Speaking at the webinar, the Group Managing Director/Chief Executive Officer, Access Bank Plc, Herbert Wigwe, said, “The banking industry as a whole was willing and ready to carry out this function. The banks have very strict compliance measures, in terms of verification and making sure that people who do apply are eligible.

“All Nigerian banks will be able to meet these requirements. If you look at all the branches nationwide, you will know that the banks have more than enough capacity to do this.”

He said if the banks saw any compliance issues, or people attempting to do things cunning, they would be reported to the CBN because the banks would ensure full compliance with the order.

The Group Chief Executive Officer, Guaranty Trust Holding Company Plc, Mr Segun Agbaje, while speaking on the capacity of the banks to meet the customers demand, said, “It is not only the CBN that has the ability to fund the market; the banks also have the resources to meet the demand, and we have agreed collectively that it will start immediately.”

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NERC: Over 1m Electricity Consumers Have Received Prepaid Meters

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