Compulsory N500 'NYSC Foundation' Deduction Generates Controversy..."ALAWI"

In what has emerged like a replay of the Police Equipment Fund scandal, a crisis is at present brewing within the National Youth Service Corps (NYSC) over the compulsory one-off deduction of N500 from the allowances of corps members to fund a scheme that is ostensibly a private concern, but registered as NYSC Foundation.

The foundation is believed to have benefitted from corps members' contributions running into millions of naira. NYSC mobilises at least 300,000 young graduates of tertiary institutions annually.
THISDAY investigation revealed that the scam all began in 2007 with the approval of the then management of NYSC.

But the foundation, speaking through its Executive Secretary Mr. Sayo Banjo Akinnigbagbe, said the deductions were not compulsory.
According to documents obtained by THISDAY, the NYSC Board in August 2007, under the leadership of Alhaji Mahmood Baffa as acting Chairman of NYSC, with Brigadier- General Yusuf Bomai as Director-General, had approved "the mandatory registration of corps members into the NYSC Foundation at the point of discharge from service".

The same documents also disclosed that the then Secretary of the Foundation, Barrister (Mrs.) N.E Ukagha, had informed the Board that, "the Foundation is a Non-Governmental Organisation, that would have its secretariat and staff independent of the NYSC."

Following the documents, members of the board had agreed that the idea was a laudable one, but sought to know the relationship between NYSC and the foundation.

DG Bomai at a meeting of the NYSC Board held on August 22, 2007 at Rockview Hotel, Abuja had, however, explained that the relationship between NYSC and the foundation was like that between universities and their alumni associations, adding that the funds generated by the foundation would be used to finance strategic projects or programmes of the scheme.

According to documents obtained by THISDAY, Bomai had said: "The public would find it difficult to deal with the NYSC on fund generation but would be at ease to relate to the foundation."

The foundation was registered with the name and logo of NYSC but a source said this might have been a deliberate ploy to deceive the corps members and potential philanthropists into contributing to the cause.
He queried how the NYSC management would ensure the channelling of funds accruing to the foundation back to the scheme if the foundation is independent of the scheme.

"What legal backing does the NYSC have to allow the compulsory deductions from the corps members' allowances," the source queried.
According to THISDAY investigation, there is no information about the foundation on the NYSC website. The foundation is also conspicuously missing from the NYSC's list of partners and collaborators, which include International Institute for Sustainable Development (IISD) and John Hopkins University.

Others are Ea-Net Africa, Energy Commission of Nigeria (ECN), UNICEF, USAID, WHO, UNESCO, British council, World Bank, WOTCLEF, US Embassy, NDLEA, ICPC, EFCC, SERVICOM and Legal Aid Council.
The constitution of the foundation in Article 2, Subsection 3 states, "The foundation is a private sector initiative for the National Youth Service Corps."

Also Article 5, Subsection D. 2 on Grand Patron and Life Patron states, "(I). The incumbent Head of State shall be the Grand Patron. II. The founder (Head of State) of the National Youth Service Corps shall be the Life Patron and Chairman of the Board of Patrons.

The Trustees listed on the back page of the Certificate of Incorporation were Mr. Remi Olowude, Major General S.K Omojokun (rtd), Major General H. B Momoh, Brigadier General S.M Dule, Alhaji Abubakar Abdullahi, Mr. Banjo Akinnigbagbe and Mrs. Nwano Eze-Ukagha.

It is, however, not clear if the afore-mentioned are still trustees of the foundation, which was registered by the CAC in 1999.

A Batch B, 2012 corps member, who simply gave his name as Ikechukwu, said he tried to apply for the loan provided by the foundations, but the NYSC officials in Kogi State did not seem to know much about how he would go about it.

"I did not get convincing details; they seemed confused and were just giving me conflicting details," he said.

Another former corps member said in a post on www.nairaland.com, "What I gathered is that the repayment period is 18 months with three months moratorium at a five percent interest rate.

"The requirements are submission of business proposal, civil servant guarantors, evidence of repayment and application letter, which would be submitted to the NYSC secretariat. Your discharge certificate is the only collateral required and would be held until the last dime is paid."

THISDAY enquiries revealed that some of the members of staff of NYSC were not even aware that the foundation was independent of the NYSC.
"Are you sure the foundation is not part of us? It should not have been possible for them to use NYSC logo if they are not part of NYSC. We here have defended the N500 deductions," an official of the NYSC, who pleaded not to be named, told this reporter.

When THISDAY visited the foundation's headquarters on 3, Gwani Street, Zone 4, Abuja, its Executive Secretary Akinnigbagbe said the deductions were not compulsory.

He, however, could not provide the exact number of the voluntary ex-corps members of the foundation, a development he blamed on NYSC desk officers who are responsible for sensitising the corps members during orientation on the activities of the foundation.

Akinnigbagbe, who retired in 2003 as a Director at the NYSC headquarters in Abuja, said the plan of the foundation was to set up a database of the ex-corps members who are members of the foundation, but the NYSC desk officers regularly failed to send in the list of the subscribed members. He, however, noted that all subscription funds get to the foundation.

The Chairman of the NYSC, Chief Gordon Bozimo, in a telephone conversation with THISDAY, however, disclosed that the board when it was inaugurated in July was not briefed about the activities of the foundation by the management.

He said the board had directed that the deductions be stopped forthwith.
Akinnigbagbe presented the funds collected in states in the last two years as N51,422,955 for 2009/2010 batches, N42,802,800 for 2010/2011 batches and N51,784,300 for 2011/2012 batches.

"If it was compulsory, would this be all that would have been collected," he said.

He added that the foundation also had about N14 million outstanding that some of the beneficiaries had refused to refund.
Some refunded their loans after letters were written to them and their names published in national dailies.

Some, according to him, have their guarantors gradually paying back the loan.
The foundation, in its profile, said it had given soft loans not exceeding N400,000 each to 87 former corps members.

Financial documents obtained by THISDAY showed that the foundation had built and furnished a 150 capacity Corpers Lodge in Jos, Plateau State at the cost of N57, 504, 624. Other donations on the profile of the foundation are 500 double bunk beds (Abia State camp), four units of eight-room VIP toilets (Cross River State), four units of 40 feet Julius Berger shipment containers as storage for orientation course materials (Nasarawa State) and 500 chairs, 25 tables and a collapsible podium (Kebbi).

Others are 10 units of VIP toilets (Gombe) 220 Kv generator (Ogun), 150 double bunk beds and 300 mattresses (FCT) and five mobile toilets and bathrooms (Lagos).

The records made available to THISDAY showed that since inception, the foundation had collected N337, 555,010.16, all from membership subscription.

Following the records, N24, 262,300 had been given as loans to 85 ex-corps members, while N20,395,000 had been approved for disbursement to 51 ex- corps members later in October.
The records also showed that the foundation has N82,635,203.18 in its accounts in fixed and current accounts with Eco-Bank and Zenith bank alongside a revolving loan account with Zenith Bank with a current balance of N13,332,336.58.

THISDAY, however, could not independently verify these figures.
But Bozimo said: "What happened is that the DG at the time (2007) convinced the board to allow the deductions, but no board has such power. Issues like this are high policy matters that need government approval, it is just like the public university that cannot increase fees without the approval of the Ministry of Education".

Describing the deductions as an anomaly, Bozimo disclosed that the Executive Secretary of the foundation and a member of Board of Trustee of the Foundation had already appeared before a committee.

The findings of the board, he said, would soon be presented to the Ministry of Youth Development, which oversees the NYSC as a parastatal.
"From our perspective, we have seen that the relationship between the foundation and the NYSC is not clear," Bozimo said.

Source: ThisDay Live Newspapers.