SEC records N2.1bn revenue deficit due to capital market turbulence

Munir Gwarzo, Director General of Security and Exchange Commission (SEC) on Wednesday adduced the plummeting revenue base of the Commission from N5.2 bn to N2.9 bn to the turbulence being experienced in the nation’s capital market.

Records from the Commission showed decline of N2.1 bn revenue projections for the year under review.

Gwarzo, stated this during the 2016 budget defence held at the instance of the House Committee on Capital Market and other Institutions chaired by Tajudeen Yusuf (PDP-Kogi).

On his part, Tajudeen Yusuf, chairman and other members of the Committee of expressed concerns over the utilisation of N4.6bn out of N5.4bn spent on staff emolument despite the inability of the Commission to meet its projected revenue within the period under review.

On his part, Aki Madaki (APC-Kano) also queried the Commission over the utilisation of the N7 bn reserve used to augment the revenue shortfall as well as the

According to the documents presented to the Committee, the Commission has so far spent N150.8mn out of N161.9mn approved for Children education allowance; N142.1mn out of N145.8mn for dressing allowance; N911,911 out of N10 mn approved for additional qualifications, among others.

While responding to the lawmakers’ inquiries, Gwarzo said: “We are going through very turbulent period ad the state of capital market affects our revenue projection of N5.2 bn as revenue for 2016 but we got N2.9 bn which shows that we are short of what we budgeted.”

Gwarzo also explained that the Commission was unable to realise income through investment as a result of the projected Treasury Single Account (TSA) adding that revenue through penalties realisable from infractions has also diminished due to the level of compliance by the operators.

He added that the only contract awarded by the Commission for the supply of UPS at the sum of N72 mn has not be paid as the contractor requested for extension of the products due to the fluctuation of foreign exchange.

The SEC helmsman however noted that the Commission was left with the budgetary allocation and concentrate on its regulatory functions and intensity drive for retail investors into the market.

While speaking, Danburam Nuhu (APC-Kano) who queried the N2.9 bn or 60% revenue generated by the Commission, expressed concern over the utilisation of 80% of the projected expenditure.

“Your revenue projection of N5.2 bn was not achieved but you’ve achieved about 60% (N2.9 billion), my worry is that they are not bullish enough on the revenue but they are on the side of expenditure by achieving 80%.

“I’m more worried about some of the expenditures in particular, as it has to do with your staff emolument. For me, you are paid for no value because here you are, an organisation that is supposed to be generating revenue but you are more convenient about what you get than what the organisation is getting. This is a worrisome for us and should not be allowed to continue,” Nuhu said.

While ruling on the outcome of the meeting, Yusuf directed the Commission to provide details of the staff employed by the Commission in 2016, list of the current and capital contracts awarded and contractors engaged to execute the projects and appear before the Committee next week Wednesday.