The Security and Exchange Commission (SEC) has come under the scrutiny of the Nigerian Senate over its inability to generate revenue from operational activities. The senate raised the alarm that the commission was gradually becoming insolvent, stating that it may go bankrupt soon.
That was the verdict of the upper chamber when Lamido Yuguda, the director-general of SEC, Nigeria’s capital market regulator, appeared before the Senate Joint Committees examining the 2022-2024 Medium-Term Expenditure Framework and Fiscal Strategy.
The senate committee on finance, led by Solomon Adeola, who is also the chairman of the joint committees, inquired from the SEC boss on how the agency had been meeting its obligations, as well as other financial responsibilities in the capital market, which include the funding of certain projects by the commission.
Yuguda, in his response, said the SEC has inflows from revenue yielding investments which it has been using to fund and finance its deficits over the years. “We have a N6 billion investment that has been financing the deficit over the years. We invested in government treasury bills,” he said.
According to the SEC DG, the agency had a total revenue target amounting to about N11 billion for the year 2021 and a projected expenditure of N16.7 billion, indicating a deficit of N5.17 billion.
“As of the end of June 2021, our revenue performance was actually N2.8 billion while our total expenditure was N4.45 billion and the deficit was N1.77 billion. Our expenditure is more than our total receipts. The total revenue of the SEC has been badly affected by the market meltdown and the COVID-19 pandemic.
“Most of our expenditures are staff costs because we have a staff strength of 544. The cost includes salaries and pensions paid to retired workers. The total personnel cost that was projected is N10.32 billion for 2021, but that has taken into consideration the N2.3 billion budgeted for early retirement programme, which has not happened,” he stated.