unnamed

Why Insurance Cover is a Necessity for All

by with No Comment BankingEconomyPolicy

Many Nigerians don’t fully understand the benefits of insurance, and as such they feel they don’t need any form of insurance cover. But this should not be so. We all need insurance.  You need one form of insurance cover, I need it too. Yes, we all need an insurance cover since there are so many uncertainties in life. But then you need to know and understand what it is that you are covered for. So there is need for you to understand the needs and benefits of insurance so as to make an informed decision before you purchase a cover.

Insurance operates on the basis that losses and misfortunes can occur anytime. It is informed by the wisdom that it is better to plan for a rainy day, so as to reduce or manage the impact of a loss, should it occur. There are also various religious teachings that underscore the importance of insurance as a financial planning mitigation tool. In the traditional African societal set up, insurance was also practiced. In Nigerian society, it used to exist in one form or the other and continues to be practiced in some areas till date. Among the Yoruba, there is what is called Esusu-by pooling resources to help those in need. This practice, however, is not sustainable in the current life these days. As a result of this fact, there is the need for individuals to purchase insurance covers.

Why Insurance?

You need insurance because losses and misfortunes occur from time to time. In most cases when incidents such as fires, sicknesses, motor accidents and death occur, you are not prepared for the financial consequences that follow. We see cases where people resort to borrowing money from friends and relatives who unfortunately, in most cases, are often short of money. What do you expect from someone who has no money to assist you?  They don’t have, and therefore do not help much.

In extreme cases, we see cases of families disposing off assets at very low, throw-away prices because of the emergency situation. It is even sad when such assets are sold to pay for medical bills and the patient whose bills need to be paid dies before the asset is even paid for. No doubt this is double tragedy. And while insurance will not stop such deaths or losses from occurring,  (such as life or medical cover), it definitely helps cushion those who have suffered losses by availing funds to cover for the insured losses

Right Policy

Life has a lot of uncertainties. By buying insurance, you transfer possible financial losses from yourself to an insurance company. While you cannot avoid the misfortunes of life, you can be sure that with the right insurance policy, you will recover from your financial loss. So as to fully appreciate the importance of insurance and purchase the right insurance cover for yourself, you may need to:Identify your risks and needs and then do the followings:

  1. prioritize them. Remember that not all risks are insurable and your insurance needs are specific to you. You should not buy an insurance product simply because your friend bought a similar product and it sounds good.
  2. Insurance is not a straight fitting jacket! Discuss your risks and needs with an insurance company or a broker or an agent near you. Always compare policy benefits against premiums of several insurance companies before you settle on one. A colleague once mentioned that insurance intermediaries (brokers and agents) are like doctors who diagnose and prescribe medication for their patients in that they should help you identify that area in which you are hugely exposed and advice the right insurance product for you!
  3. Match the available insurance products to your needs and choose the one that best meets your needs at affordable cost. When you match your needs with the policy, it is highly unlikely that you will cancel the policy before it matures. This is because you will have understood it and known exactly that which you are getting into. Once again remember to purchase only that cover that you need, based on your risk assessment and prioritization. Where possible avoid instances of buying more or less than you need.

Peace of Mind

Perhaps the most significant benefits of insurance include protection of family and assets and the resultant peace of mind that one has when they have an insurance policy. There are also other benefits like savings, financial security, investment vehicles and tax relief. Lastly, remember that your health is your wealth- sicknesses strike without notice. So take charge of your health and consider buying a medical insurance cover. The NHIS Scheme of the Federal Government is there for you and your family to use.  Paying N5,000 a year to NHIS for health coverage for one year is nothing, compare to the cost of healthcare. When anyone in the family gets sick, such a scheme will shield you from out-of-the-pocket medical spending.  Then what about children education? The future belongs to the educated-with education becoming increasingly expensive; consider buying a policy for your children’s education. Accidents occur anytime, anywhere-consider purchasing a personal accident cover against disabilities and deaths resulting from accidents (even those from accidental stair case falls.

idris

Ahmed Idris and the Task of Maintaining Delicate Balance in the Disbursement of the Federation Accounts

by with No Comment EconomyMonthly PostPolicy

The sleek figure of Ahmed Idris, the Accountant-General of the Federation, works his way around the crowded, oak-panelled office, in Abuja whenever the federal accounts allocation committee assemble to take decision on the sharing of the federation accounts. He sits down and reasons with MDAs and states to reconcile all payments in transit that has not hit the account yet, and take the net balance. That is fairness.

For Idris, meetings help him reach out and forge a network of support and build transparency. For the other stakeholders, it’s a chance to meet someone many expect to one day move up to higher responsibilties.

Idris has the strengths that so many people in government offices so conspicuously lack, not only critical thinking and complex competence but a grasp of detail. And his speech is a reflection of the depth of commitment, professionalism, faith in human and civilized principles and values. These attributes help him navigate the challenges of managing the federation accounts equitably. He is also concerned with e-governace and Government Integrated Financial Management Information System (GIFMIS) operations.

while many public officials have floundered during the coronavirus pandemic, Idris has been a beacon of calm and competence, intervening swiftly on how to spend billions of Naira supporting the different tiers of government so concerned with how to create jobs as the economy went into lockdown free fall. With restrictions lifted and life gradually coming into force in different parts of the country, Idris been part of those putting people minds at rest.

He is a man who believes in transparency And he communicates about it quite effectively in order to promote transparency. Last year December when President Muhammadu Buhari launched the transparency portal. Idris quickly worked out modalities for its workability

He gave a fluent defence of this measures at a media conference early this year.

“Nobody can be open without being transparent. One cannot be transparent without being accountable. In all these the principles of stewardship is entrenched to a very large extent on all workers in the government offices, agencies, ministries, parastatals and so on. These are the stewards. The public has a duty and responsibility to be informed and enlightened about what is going on, particularly where the management of resources or public funds are being spent. That is what the government is trying to do with most of these reform initiatives.

The objective is to be transparent, open, accountable, and to ensure the public is aware of what is going on with funds and resources being managed or kept on their behalf, reminding everyone that this is the treasury of the nation. What this means is that resources come in and out for one programme or another.”

Sometimes ago early this year, the Office of the Accountant-General of the Federation, OAGF, began a comprehensive review of treasury forms and other accounting source documents in use in all ministries, departments and agencies, MDAs, of the Federal Government.

A statement by Henshaw Ogubike, Director, Information, Press and Public Relations, noted that the review was in exercise of the mandate of the Accountant General of the Federation under FR.107 (n) to issue officially-approved forms bearing treasury numbers for use in all Federal Ministries, Departments and Agencies to ensure uniformity.

It added that already, the Accountant-General of the Federation, Idris, has inaugurated an inter-ministerial committee to handle the review of the documents.

Speaking at the inauguration of the committee, Ahmed said the committee was expected to identify all treasury forms and accounting source documents presently in use; come up with new formats in line with the public financial reforms; recommend additions or deletions of the contents; assign relevant number systems to the treasury forms and review the documents in line with GIFMIS (Government Integrated Financial Management Information System) operations.

He stressed that in carrying out the assignment, the committee should be guided by the Federal Governments quest for adoption of e-governance at all levels and the fact that all the public finance reforms initiatives being driven by the Treasury are predicated on full deployment of ICT solutions.

Rationale  for the review of the documents was because the contents of the treasury forms and other accounting source documents in use were no longer relevant and useful to drive the various public finance management reforms of the Federal Government, which are mostly ICT-driven. As a result, a comprehensive review and update of these accounting source documents was thus imperative for an efficient and successful implementation of government’s financial management reforms.

“He reiterated the government’s resolve to ensure a successful review of the documents and charged the committee to give the assignment all amount of seriousness it deserves and deliver on time.”

 

Last December, the Federal Government launched the transparency portal as part of the reforms against corruption. Under this arrangement, ministries, departments, and agencies (MDAs) were directed to submit daily, monthly, quarterly and annual treasury/financial

Addressing the press some months later, Idris explained that his office had have rolled out a portal to actualize the policy. He added that part of the problem is the sensitization of the public and capacity building for the officials that will handle the system. According to him,this is because the transparency portal is completely new and the operators at the MDAs would require to be trained. That is in the pipeline

Speaking further, he disclosed that the OAGF was giving them a maximum of four months to update their skills. Not only that. It would call the MDAs and sit with them on the portal for them to ask questions on what should be done and the way they should be handling the reporting from their respective MDAs, asserting that the fact that the president launched the

“We ae now trying to upload information to the portal. Some information are historical. They will need to be put in the system. Before that is done, the Financial Officers and those who will be managing the system from the MDAs will need to be trained. The public needs to be sensitized on what they should be expecting. All these are being rolled out now.”

Therefore, the fact that the portal has been launched does not mean that we are 100 per cent available to the public immediately. But, the portal is active. There are some useful information there. Every week one checks the portal, there is always an improvement in terms of what is available and what we were given. That is how we will populate the portal.

Talking about whether all these should not have come before the launching of the portal, what I have to say is that you cannot jump the gun.

“In government, you don’t begin to implement a policy unless there is an approval. Even the treasury single account (TSA), when we started, that was why the government had problems. There was some resistance. But, eventually, we are now there. Likewise the Integrated Personnel Payroll Information System (IPPIS). That is why we are having problems. Some are real problems because of resistance. Some because you cannot jump the gun to implement it. A budget cannot be implemented unless the National Assembly passes it and Mr President signs it into law.”

The Accountant-general’s affirmation of its support for transparency around the nation is a clear reflection of the deep strategic awareness of the danger of lack of transparency, which has infested many people in the country.

akinwunmi

Akinwumi Adesina and the Challenges of post-pandemic Africa Economy in his second term as AFDB President Nigeria’s

by with No Comment Policy

Dr. Akinwumi Adeshina has been re-elected as the President of the African Development Bank (AfDB), for another five-year term. The re-election took place electronically during AfDBs’ 2020 Annual Meeting in August. But days after his re-election,  analysts are already asking what will a post-pandemic economy in Africa look like? What contributions will Adeshina and his management put on the ground to help ensure inclusive growth in Africa?

Of course, a day before Adeshina’s election, he had said he wanted to seek a second term in office, and being given a second chance would assure the need for unity to enable the continent to pull together and stay focused on the goal of fighting the effect of the pandemic on Africa’s economy. According to him, “pulling together has always been the strength of the African Development Bank.”

He said that Africa has lost a decade’s worth of economic growth due to the pandemic and that despite Africa’s recovery being long, the need for unity would be needed now more than ever in the AfDB.

“Now we must help Africa to build back, boldly, but smartly, paying greater attention to quality growth: health, climate, and the environment,” he added.

He also disclosed that the bank’s Board of Directors was able to launch support schemes to Adesina said his first term as President of the Bank saw the implementation of the five strategic goals for Africa’s development, called the “High 5s”.cushion the effects of the pandemic. “

Adesina said the impact of his five years as President had enabled 18 million Africans have access to electricity, 141 million people have benefitted from improved agricultural technologies for food security. 15 million people have access to finance, 101 million people have access to improved transport and 60 million people have gained access to water and sanitation.

“With these positive results, President Adesina asked the Board of Governors to renew their trust in him for the next five years. “Dear Governors, these Annual Meetings are my opportunity to offer you my services and seek a second term as President of the African Development Bank. I do so with humility. I do so with an acute sense of duty and commitment. I do so to serve Africa and our Bank,” he stated.

Of course, he got his second term at a difficult time when it is clear that the world is currently in the midst of some kind of inflection point. But in confronting this inflection point, will Adeshina be able to deliver impact beyond that which he had delivered in his first five years as President of the AfDB, enabling more Africans to have access to electricity, access to health,  water and sanitation, access to improved food security,  access to finance?

Andy Grove, noted author and pioneer, introduced the concept of strategic inflection points as moments in time when the fundamentals of business change, requiring a major shift in how we operate. The dilemma is when to take action — move too early, you will waste resources; wait for a while, you will get buried.

The COVID-19 presents no such dilemma since this inflection point is here-and-now, and serious. Luckily the world is easing out of it, and the mortality rate is low due to social distancing and lockdowns but the impact on the global economy is big. In Africa, it is huge, something not witnessed in our lifetime.

Analysts point out the dismal disappearance of normality in the way people live and do things, it’s important to acknowledge how awful this is going to be for a great many people who are dependent on daily wages and monthly salaries. Many companies may soon refuse to pay, forcing workers to quit.

Observers assert that pandemics have often catalyzed social change. Water, sewage, and public health authorities all emerged from previous epidemics. Social change can also come from economic change, such as industrialization and the creation of the first instance of mass inequality in what came to be called the Gilded Age.

They say Dr. Adeshina should work better with African leaders and policymakers to work on early warnings scenarios, so as to be able to pull people out of the cave of economic pains. And that using inflection points, AfDB, and African leaders can build scenarios and early warning systems for the post-corona future of Africa. This will be like a “thin-ice” moment because things are moving very quickly but the framework may still be useful for decision-makers.

The proposed framework, they insist, will articulate two (or more) crucial uncertainties, create a story about the future states that different values of the future uncertainties might imply, define a “time-zero” event and work backward to create an early warning system. says  Dr. Tade Olugubile, Covenant University, Ota, Ogun stat he explained that this was part of the issues  Rita McGrath, a professor at Columbia University. M Muneer and the co-founder of Medicine Institute Foundation for Diversity and Innovation raised recently.

“Let us create four quadrants for potential post-corona economic scenarios. The first dimension (X-Axis) shall be the current capitalistic “maximizing shareholder value/profits” on the left side and the new “maximizing shared value”, which is neo-socialism, or reimagined as “stakeholder capitalism” where suppliers, customers, workers and society flourish along with the business, on the right.

For the other dimension (Y-Axis), choose “prolonged global slowdown” on top and “bounced-back economy” on the bottom.

He explains that the next step is to create a short “story” about the future state each scenario represents.

Four scenarios emerge Maximising shareholder value:

1) With economic catastrophe, the result could be pervasive poverty and inequality, economic insecurity even for middle class, and political instability in many countries.

2) With economy bouncing back, rinse and repeat of the last many years — middle and lower classes continue to struggle, high levels of inequality remain.

3) When doom happens, there will be expanded social security programmes, greater taxation, or even some nationalisation of private wealth, and alliances between government and NGOs.

4) Economy bouncing back, things will return to the consensus on distribution of societal wealth, inequality narrows gradually and social goods made more affordable.

“Now come up with what we call a “time-zero” event for each of the four scenarios — in other words something that might be in media that represents either positive or negative signal of an inflection point. Once the “time-zero” events are established, work backward to identify information that would represent leading indicators of the event becoming a reality. If you see lots of indicators piling up, it is highly likely for the event to become reality”.

Dr. Adeshina on a thank you visit President Muhammadu Buhari at ASO ROCK Villa

Interestingly, we see weak signals that any of the four scenarios outlined above could be in our future. In fact, for all of them, we are able to find real, in-the-here-and-now headlines reflecting that scenario coming to fruition.

The question for all of us is whether we can create strategies that are robust in the face of all of these possibilities or whether we should bet on one.

Let us assume the time-zero event, “death of the soul of capitalism”, ensues in which case governments will have to turn tough on profiteering private enterprises for the sake of the larger working class, both local and migrants. Some indicators we might see are:

A rise in the popularity of authorities to take coordinated action

Pressure builds to eliminate easy access to stock buy-backs that lead to mass layoffs

Restrictions on executive compensation

Investors to take a hard look at cash reserves of firms

Minimum sustainable income plans

Increased health and social benefits to the labour class

While these aren’t predictions about what is likely to happen, it’s clear that we are in the midst of some kind of inflection point.

We’re going to be asking questions about many of our taken-for-granted assumptions: That globalisation and trade are always good; air travel should be accessible to everyone; we shouldn’t have to invest in building resilient systems, just efficient ones; nationals cannot do hard labour; and so on.

African Development Bank,  under Akinwumi Adesina, needs to make Africa able crawl out  of economic crisis created by COVID-19  fast. In this way, he will justify his re-election as head of the AfDB  to serve Africa  “with an acute sense of duty and commitment.”