20 January 2010

Nigeria: House Endorses Mass Sack in Banks

Abuja — The House of Representatives yesterday endorsed the current mass purge in the banking sector in which several commercial banks have sacked thousands of their workers allegedly to shed excess weight and keep afloat.

The Central Bank of Nigeria (CBN) Governor Sanusi Lamido Sanusi had early this month justified the mass sack, saying most of the banks were spending too much on staff salaries, adding that banks being private companies could take their decisions on engagement and disengagement of workers based on business imperatives.

In what some lawmakers described as "insensitivity" to the plight of the affected workers now thrown into the labour market, the House rejected a motion seeking to probe the mass sack and possibly halt the trend.

Hon. Kayode Idowu representing Boripe/Ifelodun/Odo-Otin Federal Constituency of Osun State, who brought the motion to the floor of the House, recalled that the mass lay-off of employees in the banking sector started when the new management appointed by the CBN to manage the affairs of the ailing banks assumed office at the respective banks.

Idowu disclosed that preliminary investigations across the concerned banks had revealed that the criteria adopted in the retrenchment exercise was rather hazy as the exercise affected different cadres of the workforce in the banks.

He observed that in the midst of this confusion, the CBN had insisted that it did not authorise the concerned banks to reduce their workforce.

According to the lawmaker, the current situation in the banking sector was neither in the interest of the sacked employees nor in conformity with the Seven-Point Agenda of the Federal Government which has job creation as one of its cardinal programmes.

He expressed dismay that the apex bank, which has supervisory roles over the banks and ought to have intervened, had refused to do so because of the claim that banks are private enterprises which take independent decisions on issues of engagement and disengagement of employees based on business imperatives.

Idowu had in the motion, prevailed on the House to mandate the Joint Committee on Banking and Currency, Capital Market and Justice to investigate the mass sack and recommend appropriate policies or mechanisms by which the government could address the situation.

Although the motion enjoyed the support of a good number of the legislators who wanted the mass sack halted because of its perceived negative impact on the economy, it however ran into stormy waters when another group of lawmakers insisted that so long as the banks remained private enterprises, the House could not interfere in what they considered internal and administrative decisions.

Hon. Chinwe Igwe (PDP Rivers) and Hon. Ifaluyi Isibor (PDP Edo) argued in favour of the motion, but their position was vehemently challenged by Hon. Sani Abdu (ANPP Bauchi), who said he would only support the motion if the banks were nationalised and the Corporate and Allied Matters Act amended to bring private businesses under the purview of the National Assembly.

Due to the preponderance of opinions canvassed during the debate, Speaker Dimeji Bankole had the task of ruling on the motion to decide the direction the House should take. Thrice he put the question and thrice the voice vote moved the pendulum towards those who opposed the bill.

Also yesterday, the House passed into law a bill seeking to regulate the use of sirens on Nigerian roads. The new legislation came into being when the Bill for an Act to Amend the Federal Road Safety Commission (Establishment) Act, 2007 passed through the Third Reading stage.

The bill will now be transmitted to the Senate for concurrence after which it becomes fully effectual. Two other bills were stood down on technical grounds to enable the House Committee on Rules and Business to harmonise the position of the House vis-à-vis that of the Senate on the bills.

A third bill, which sought to repeal the Federal Road Maintenance Agency (FERMA) Act and establish a Federal Roads Board and Roads Fund, was stepped down by its sponsor, Hon. Leo Mayor Eze, who asked for some time to further fine-tune the bill.

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