Out of the outstanding N19 billion in erroneous deductions made by National Housing Fund donors, the Federal Mortgage Bank of Nigeria has returned N12 billion.
Under the 40% deduction regime of revenue coming to federal agencies, the deductions were mistakenly interpreted as revenue.
This was revealed on Wednesday at the FMBN Day at the 18th Africa International Housing Show 2024, which was hosted in Abuja. Mr. Shehu Osidi is the Managing Director/Chief Executive of FMBN.
In 2023, federal universities and other partially supported institutions nationwide will automatically have 40% of their internally generated revenue deducted by the federal government.
The finance circular with reference number FMFBNP/OTHERS/IGR/CRF/12/2021, issued December 20, 2021, governs the auto-deduction policy of gross IGR.
Nonetheless, it placed restrictions on the yearly budgetary expenditure from IGR of the federal agencies that receive partial funding in a circular.
In order to recover N12 billion of the outstanding N19 billion into the Bank’s coffers, Osidi said, “We initiated constructive engagement with the Federal Ministry of Finance to secure refunds of the wrongful deductions of NHF contribution misconstrued as revenue under the 40 per cent deduction regime of the revenue accruing to the Federal Agencies.”
In addition, he stated that the bank was contacting the appropriate authorities in order to “recover outstanding balances trapped by NHF funds” and to cease the deduction of labour savings.
According to Osidi, the Ministry of Finance on behalf of the bank’s new management has submitted a request to the Federal Executive Council for the recapitalisation of FMBN. “An inter agency committee on the recapitalisation of the Bank has been established a s a result of this effort to improve its capacity for providing adequate liquidity for the Nigeria Housing Finance sector and the delivery of affordable housing in Nigeria,” he said.
He mentioned the Federal Ministry of Finance, Federal Ministry of Housing and Urban Development, Federal Ministry of Finance Incorporated, and the Bureau of Public Enterprises were on the recapitalization committee.
