COMBATING CORRUPTION

When Isaac Newton, the powerful scientist who enunciated the Newton’s Laws of motion lost his fortune in the South Sea Bubble Company of 1720 due to corruption. He said  and I quote  “I  can calculate the motions of heavenly bodies but not the madness of men”. Today in my people there is madness, everyone is thinking of getting rich quick. ( Kiyosaki 1990:70)

And according to Ojo (2009:11) in an article captioned, “Reps set to pass cyber crime bill, he stated that corruption has grown so wide to include advance fee fraud, password sniffing, hacking, web cramming, credit card fraud, identity theft , data kidnapping, software piracy, cyber squatting, unlawful interceptions etc”

The preamble to the 2003 United Nations against corruption (UNCAC), which Nigeria has ratified states that corruption “is no longer a local matter but a transnational phenomenon that affects all societies and economies. The African convention on preventing and combating corruption which Nigeria has ratified acknowledged the need for international co-operation to combat corruption and note the corrosive effect on individual and society” Falana 2008:120.

The world is a global village ,what affects economy in our society will definitely affect other economies and countries.

Continuing Falana stated that the ground corruption exacerbates scarcity of fund in Nigeria, frustrating any interest in enriching quality and life, Nigerian leaders must accept responsibility for the continued poverty in the country, he noted that ground and blatant corruption degrades life, he went further to say that in 2006 the Commonwealth working group on assets repatriation specifically refers to corruption being defined as  an international crime  and suggest that jurisdiction of the international court be extended beyond the prosecution of crimes against  humanity as defined in Article 7 of the Roman Statutes. Falana further  stated that the early draft of the statute did in fact include  reference to crimes other than crime against humanity such as Terrorism and Drug Trafficking.

Corruption has reached an alarming rate globally, and do we continue to fold our hands and watch corruption kill our great economy, the answer is an emphatic No.  It could be observed that most people who involved in corruption often end in poverty so also for a country. And as Prof Pat Utomi 2008 in “The Limit of lets share Economy, he stated that like people who won lottery, they often return to poverty.

Odunze Reginald C.

According to Albert Einstein , who propounded the Einstein Equation, when he was interviewed and asked his most powerful motivation. He kept silent for a while. Then the interviewer asked, is it knowledge , science, physics or education. And Albert replied .......IMAGINATION

Imagination has been the driving force in life and i could still remember the Bill Clinton's statement on his inauguration as the president of the United States. He noted that the symbolic torch passing  when he stood as a member of the boys scout during J F Kennedy presidential inauguration  in the 1960s has been the driving force for his presidential ambition. All interest, desires. ambitions , hopes, aspirations etc all dies without imagination.

And the Holy Bible recognizes the power of imagination, in the building of Tower of Babel, God  introduce language saying that the people can  do whatever they can imagined

Pension Fund Administrators and the One Billion Naira Minimum Share Capital Requirement

Schwartz: 1988 in his two monumental books, the magic of thinking big and the magic of getting what you want, opined that there are three most important things in life, Women, Money and Religion, he went on saying that with women, you create life, with money, you maintain the life you created and with religion you still have hope that you are going to have life after death. Schwartz was so philosophical about this that analysts were not happy with him, but he was not deterred by that, he went on to observe that money has three derivatives, they are work ,savings and financial knowledge. I am more interested in his theory about savings. He observed that people save for two basic reasons, first for retirement and secondly to make lot of money, this is in agreement with Kiyosaki.

According to Robert Kiyosaki (1999) in his book ‘Cash flow quadrant, the Rich dad guide to financial freedom’ he noted that people invest for two basic reasons,

·         To save for retirement

·         To make lot of money

The first one underscores the importance of pension schemes, which is the more reason National Pension Commission directed PFAs to beef up their capital base. Starting from June 30^th 2012 PFAs are required to have a minimum share capital of one billion naira.

To this end, Pension Fund administrators will on the first and second quarter of 2012 embark on stringent financial strategies to raise fund so as to avert National Pensions Commission hammer on the minimum share capital requirement. They will also be doing themselves good, as failure may lead to so many things.

The commission according to the Head Surveillance M. Y. Datti stated that as part of its oversight function observed that “the minimum share capital of 150 million naira was no longer adequate to meet the operation expenses of PFA business, given its intensive IT nature and average gestation period of 5 years

“And after due consultations with the pension industry, “a minimum shareholders fund of one billion naira unimpaired by losses was approved, the amount is intended to absorb unforeseen losses and improve the financial condition as well as business process of the PFAs given current market situation” as noted by National Pensions Commission.

In the course of raising fund there may be mergers and acquisition which National Pensions Commission observe that one billion naira will “encourage healthy mergers or acquisition and also promote stability in the industry”

In the course of trying to raise fund through any means that is deemed fit for the organization, there may be whole lots of issues, Friedman in his book Lexus and the olive tree noted that “buying investment is often like getting married, in the beginning it is exciting and fun, but if things do not go well, the divorce can be much painful than all the marital excitement and fun, because getting in is a lot easier than getting out”  Therefore in investment, one of the important strategies is the exit strategy, according to Friedman.

But with careful business analysis and strategies, acquisition and merger will be  lot more exciting and rewarding in raising the needed fund, this is because they involved the pooling together of resources both human and material resources. And as PFAs embark on this important directive they should bear one thing in mind that there may be losers or gainers on individual bases among investors but the overall gain will be imparted on the industry, the pensioners and above all the economy.

National Pensions Commission noted this when they stated that the improved financial condition will lead to the following:

·         Improved service delivery and products development resulting from automation (timely payments)

·         Improved capacity building and employment of qualified personnel

·         Deployment of adequate IT infrastructure for improved business process

·         Creation of more business outlets for increased presence nationwide

·         Stronger and more efficient research unit for optimum investment decision

·         Improved data management and record keeping

This overall development will be imparted positively on the economy and the PFAs in particular and as they do this, they should bear in mind that investors are looking forward for this development bearing in mind that in an “economic bonanza, there are three kinds of people, those make things happen, those who watch things happen and those who say what happened”. Kiyosaki (1999:398)

As PFAs embark on directive and great task of raising fund, observers, analyst, industry watchers and the entire citizenry are waiting to know the fate of the pension fund administrators.