HB 26: Nigerian Industrial Revolution Plan Bill, 2015

Bill Analysis:

SHORT TITLE

Nigeria Industrial Revolution Plan Bill, 2015

OBJECTIVE OF THE BILL

The objectives of the Bill are to:

• Accelerate the build-up of industrial capacity within Nigeria;
• Increase manufacturing contribution to Nigeria’s Gross Domestic Product;
• Drive the process of intense industrialization based on sectors where Nigeria has comparative and competitive advantages

The implementation of the Industrial Plan in accordance with the provisions of this Bill is to, among other things: -

• Facilitate job and wealth creation
• Provide for economic and revenue diversification
• Ensure import substitution and export diversification, and broaden government’s tax base.

NUMBER OF CLAUSES/PARTS

The Bill has 3 parts and 34 Clauses including an Explanatory Memo and a Schedule

CONTENTS

The Bill has the following contents: -

• Part I: - Purpose and Scope of Application
• Part II: -Establishment of the Nigerian Ports and Harbors Authority and its Governing Board etc.
• Part III: - Functions and Powers of the Authority

IMPLICATIONS OF THE BILL

If the Bill is passed, the following will be the resultant effect: -

• The Nigeria Industrial Revolution Plan (the Industrial Plan) will come into being; and it is expected to facilitate job and wealth creation in Nigeria.
• An inter-Ministerial National Steering Committee will be established to ensure the proper implementation of the Plan. The Steering Committee’s establishment shall provide a platform for crosscutting Industrial Plan issues, to provide confidence to investors when specific investments require actions or approvals from government.
• Relevant ministries, departments and agencies shall establish Industrial Revolution Plan Units within their ministries, departments and agencies;
• The Industrial Plan Fund shall be established to fund the implementation of the Plan;
• The National Enterprise Development Programme shall be established to serve as the strategy for the development of micro, small and medium enterprises (MSMEs) in Nigeria. Development of MSMEs in Nigeria will have to follow thisstrategy
• The implementing agencies for the Programme shall be the Bank of Industry, SMEDAN and the Industrial Training Fund;
• The National Council on MSMEs shall be established to be the apex body responsible for the development of policies for the small businesses; with the Vice President of the Federal Republic of Nigeria as its Chairman

GENERAL PROVISIONS OF THE BILL

1.  Establishment of the Industrial Revolution Plan: -The Bill seeks to establish a plan, which would facilitate job and wealth creation as well as increase the industrial capacity within Nigeria. The implementation of the plan shall be nationwide and according to industry groups where Nigeria has potential for rapid industrialization.

a) Agribusiness and agro allied

b) Solid minerals and metals

c) Oil and gas related industry

d) Construction, light manufacturing and Services

The implementation period of the Industrial Plan shall be 5 years under this Bill (Clause 20).

2. Skill and Business Environment Development: - The government intends to support the Plan by intervening in broader areas hindering competitiveness of the industrial sector in Nigeria by: -

• Providing technical and vocational skills development at Federal and State levels (Skill Development);
• Establishing infrastructural facilities including industrial cities and parks (Infrastructure improvement);
• Strengthening exiting industrial training institutions;
• Encouraging national innovation systems to enhance competitiveness
• Building a 3-way partnership between the academia, public and private sector to create a knowledge network
• Promoting key technologies required by industries in addition to strengthening institutions that promote technology transfer, innovation and entrepreneurship;
• Enabling the review of laws and regulations affecting investments
• Strengthening the institutional framework for enforcement of contracts and judgment of courts;
• Strengthening the national quality certifying agencies and cooperating with relevant international quality certifying agencies
• Encouraging the consumption and utilization of domestic products and strengthening consumer and environmental protection agencies;
• Ensuring the availability of financial terms and conditions of finance to support industrial development.

3. Approving Authority: - The President and Commander-in-Chief of the armed forces shall be the approving authority for plans and programs. The President shall also approve the plans annual updated releases on the recommendation of the Presidential Advisory Committee (to be established when the Bill becomes law)

4. Establishment of a Presidential Advisory Committee: - Clause 5 of the Bill seeks to establish an Advisory Committee to be the apex regulatory body for the Plan with government and private sectors representatives. The composition of the Committee shall include: -

• The Ministers of Trade & Investment (Chairman)
• Finance
• Power
• Transport and Works.
• The Governor of the Central Bank
• The Chief Economic Adviser to the President
• A leading private sector industrialist, who shall be the alternate Chairman and 19 other private sector investors

5. Powers of the Minister: -

• The Minister responsible for industry shall from time to time review the number of private sector representatives on the Advisory Committee (Clause 24(4));
• Shall recommend a private sector actor to be appointed as the representative of the private sector by the President;
• Shall recommend for appointment by the President, members of the Steering Committee as listed under Clause 6(1)(d);
• May by order, add to or remove from the list contained in the schedule to this Bill the name of a Ministry, Department or agency as considered appropriate;
• May make such regulations as are necessary for the efficient implementation of the provisions of this Bill (when passed into law)

6. Secretariat of the Advisory Committee: - The Secretariat for the meetings of the Advisory Committee shall be domicile in the department of Industry in the Ministry and the Director in the department shall serve as the Secretary of the Advisory Committee.

7. Establishment of the Ministerial Steering Committee: - Under Clause 6, a multi-sectoral, inter-Ministerial National Steering Committee shall be established, comprising of the Permanent Secretary, Ministry of Trade and Industry, representatives not below the rank of a director from 17 Federal Ministries and agencies and the Minister of State for Industry, Trade and Investment as the Chairman. The Advisory Committee may alter the composition of the members of the Steering Committee.

8. Functions of the Steering Committee- Clause 7 (1)(a) – (h) lists the functions of the Steering Committee, which includes but not limited to the fact that the Steering Committee shall regulate its proceedings and that of its committees.

9. Establishment of the Project Office: - The Project Office shall be established and located in the Department of Industry of the Ministry, for the day-to-day management of the industrial plan (Clause 8).

The project office shall be staffed by officers of relevant government agencies, as may be required, special consultants and representatives of development partners assigned to carry out specified tasks in connection with the industrial plan. The following positions shall be created for the Project Office -

• Project Custodian: Clause 9 provides for a Project Custodian who shall be the Permanent Secretary in the Ministry with responsibility for ensuring that the responsibilities of the Ministry and Nigeria’s vision and goals on industrialization are achieved.
• Project Coordinator: - The Bill establishes the office of the Project Coordinator to oversee the affairs of the project office (Clause 10)
• Project Manager: - A Project Manager shall be appointed from the directorate cadre of the Ministry or from outside the Ministry where the need arises. He shall be responsible for providing project management expertise and industry subject matter expertise.

The three officers shall work in cooperation with the Minister’s office. The Bill is not clear on who will be appointing the Project Manager from the cadre of the Ministry or from outside.

9a. Establishment of Special Project Unit: - One of the functions of the Project office as specified under Clause 12(g) is to establish a Special Project Unit to ensure that large projects are given visibility and recognition and unlock any regulatory hurdle to such large projects

9b. Constitution of Sectoral Team/Committee: - The Project Office shall from time to time and with the approval of the Steering Committee, establish sectoral teams or committees to carry out necessary tasks to achieve specific goals under the Industrial Plan (Clause 13). The Sectoral teams or committees shall be set up for specified duration with well-defined functions that include developing sectoral plans for the Industrial Plan and tracking their performance with a view to updating those plans as considered appropriate.

Sectoral teams or committees shall include sectors like sugar, palm oil, leather, rubber, plastics, production, fertilizers, construction of house, etc.

9c. Constitution of Support and Enabler Technical Teams: - The Project Office shall constitute on a need basis and with the approval of the Steering Committee, Support Structure and Enabler Technical Teams to be set up for specified duration with well-defined functions.

10. Establishment of Investor & Programme Database: - An investor database and programme database shall be created during the period of implementation of the Industrial Plan, to be maintained at the Ministry for consistency, coherence and industrialization process sustainability (Clause 15).

11. Establishment of the Industrial Plan Units: - These Units shall be established in a relevant Ministry, Department and Agency with responsibilities for the execution of plans, programmes and activities under the Industrial Plan

12. Funding of the Industrial Plan: - Clause 17 provides that the relevant Ministry or government department shall provide for the implementation of the industrial Plan in the annual budget estimates. However, a Fund shall be established in accordance to the provisions of Clause 18 of the Bill, which shall be paid from the annual budgetary allocation made available by the National Assembly for the purpose of implementing plans and programmes under the industrial plan.

The Fund shall be used for the expenditures incurred in the implementation of the industrial Plan and shall be controlled by the Project Custodian. The Fund shall be audited in accordance to government rules and regulations

13. State Implementation of the Industrial Plan: - The Commissioners of Commerce and Industry shall be engaged in the implementation of the plans and programmes under the Industrial Plan in the respective States (Clause 19(1)).

14. The National Enterprise Development Programme: -  Clause 21 provides for the Programme as the strategy for the development of micro, small and medium enterprises in Nigeria, which shall be implemented under the Plan. The objectives of this programme are to –

• Strengthen the institutional framework for the development of micro and medium enterprises;
• Increase access to affordable finance;
• Increase access to markets
• Encourage business development skills
• Develop technical skills;
• Promote youth inclusion in enterprise;
• Reduce high operation costs.

The programme shall be implemented in all States and Local government areas of the Federation

15. Implementing Agencies of the Programme: - The implementing agencies shall be the Bank of Industry (BOI), Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the Industrial Training Fund (ITF).

16. Establishment of the National Council on SMEs: - The Council shall be the apex body responsible for developing policies for Micro, Small and Medium enterprise in Nigeria. The National Council shall be responsible for providing guidance and coordination on the establishment of strategies and policies for the wholesome support of micro, small and medium enterprises in Nigeria (Clause 25).

17. Establishment of a Programme Monitoring Unit (PMU): - The PMU shall be comprised of four representatives of the independent bodies from the private sector to be appointed by the National Council, an officer from the Industry Development of the Ministry, and an officer from the Industry Development of the Ministry (Clause 26).

18. Obligations of Implementing Agencies for the Industrial Plan and Programme: - The Plan and Programme shall be adhered to by all relevant Ministries, Departments and Agencies, and their laws, rules and regulations shall be reviewed regularly to bring them in substantial conformity with this Bill (when passed into law)

19. Jurisdiction: - Any interpretation of any of the provisions of this Bill shall be laid before the Federal High Court.

ANY SIMILAR BILLS

This Bill is similar to the Industrial Revolution Bill, 2015 (SB 86), sponsored by Senator Bassey Albert Akpan

CONCLUDING ISSUES

The Industrial Revolution Bill seeks to accelerate the build-up of industrial capacity within Nigeria. In the wake of the country’s recession, this Bill could not have come at a more crucial time, as there is need to revamp the industrial sector, create jobs and have more made-in-Nigeria goods on the market. However, it provides for the establishment of several bodies and committees that may make processes cumbersome.

The Industry Revolution Bill (SB 86) and Nigeria Industrial Revolution Plan Bill (HB 26) are exactly the same and so both Chambers need to pass and harmonize in earnest for an accelerated passage.

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