The House of Representatives Committee on Public Accounts has said it needs to investigate the processes of approving severance package for political appointees in the Ministries, Department and Agencies (MDAs) of government.
The chairman of the committee, Bamidele Salam (PDP, Osun), named a five-man sub-committee to handle the investigation and make recommendations for adoption.
He said the Public Accounts Committee may have to recommend to the whole House an amendment to the establishment Act of some government agencies.
Salam spoke when the management of the Security and Exchange Commission (SEC) appeared before the committee to defend the 2020 audit queries issued by the Office of the Auditor General for the Federation (OAudGF).
The committee chairman said the boards of some government agencies appeared too powerful and approved any amount as severance package for their appointees.
He expressed concern over the scale of the severance package paid to board members of some agencies of government, saying: ‘If we are paying such an amount to executive commissioners who served for just four years, how do we justify compensation for individuals who have served this country for 35 years, including those who have served in war zones and on the frontlines?’
Salam said it was necessary for the government to efficiently manage its finances, especially given the current fiscal challenges.
Responding, SEC’s Director General, Dr. Emomotimi Agama, explained that the severance package and allowances were paid to the former executive commissioners who served from 2013 to 2017.
‘At the end of their four-year tenure, they were paid severance packages as approved by the board for their positions’, he said.
Agama explained that the commission operates the defined benefit and contributory pension schemes that are managed by three Pension Fund Administrators (PFAs): Sigma, Premium pension, and Stanbic IBTC.
He said the commission opted to pay management fees to the PFAs to reduce the risk of a future deficit that would require offsetting within 90 days.
The report indicated that N128,869,606.22 was paid to an individual on 5 January 2017, as severance allowance, as well as N128,556,888.58 paid to another individual on the same date, also as severance allowance.
Also, the Office of the AuGF queried the commission over an illegal payment on the gross income earned from pension fund investments, totaling N93,380,888.38.
