Durosinmi-Etti: N25bn Lagos Employment Trust Fund Widens Opportunities for Self-Employment

Lagos State Commissioner for Wealth Creation and Employment, Babatunde Durosinmi-Etti, tells John Iwori, that the N25 billion Lagos Employment Trust Fund (ETF), initiated by the Akinwumi Ambode administration, is intended to widen opportunities for self-employment for persons with business ideas and entrepreneurial skills in Lagos. It is also meant to foster a startup and innovation ecosystem, create physical hubs and potential employers, among other things.

Role of the Ministry of Wealth Creation and Employment

The primary mandate of the ministry is to look at ways of reducing unemployment and also expanding the   wealth creation outlets within in the state.  We are all aware of the enormous effect of unemployment.  We are also aware that it is only through the expansion of small and medium-sized enterprises (SMEs). They are about the largest employer of labour in any economy. If there is no growth, employment will not be stimulated.

You should be aware there are different types of unemployment: cyclical, structural and sustained unemployment. We have to take a look at it to see which one actually affects us most.

Sustained unemployment is probably the one qualified for our attention because it impact growth and development and affects the quality of lives of average Lagosians.

Our   primary mandate is to enthrone a process whereby we create opportunities for sustainable employment so that it would sort of have multiplier effect on development in the state.

 Employment Folds, Formal Employment and Entrepreneurship

We need to take a look at both. I think the most important thing is the strategy of arresting unemployment.  You are looking at arresting through the formal and informal sectors. There is only one door. You can only go in through one door and that will lead to other doors.  One generic issue that I have observed is lack of employable skills. There are jobs available.  When we have jobs, are the people employable? There has to be a mindset reorientation among the unemployed, whether, formal or informal, or graduate employment or whatever-entrepreneurship. You must have a mindset. You must have a focus. To get an idea of what we can expect going forward, it is useful first to have a clear sense of the scope of the jobs deficit. So we look at the history of unemployment. One must know where one is coming from, where the problem of unemployment lies. If not, you would not be able to find solutions to the issue.  What we did in this ministry is that we took cognizance of the history of unemployment and  also government interventions, right from the days of Directorate for Food, Roads and Rural Infrastructure (DFRRI),  move on to National Directorate of Employment( NDE), The Operation Feed the Nation (OFN), to National Poverty Eradication Programme (NAPEP) ,most recently, Subsidy Re-Investment Programme (SURE-P). If you look at it, government tried intervening all the time. That is wrong approach. Government does not create jobs. If there is no development, there will be no jobs. There must be growth.   It is only through sustainable development that will have a multipier effect on employment. One, it will cut across all the sectors you are talking about – the formal sector. Some people are establishment people.  Secondly, it becomes more entrepreneurial because when you look at the wholesalers and the retailers, the big businesses and the activities of small businesses. They create more jobs. Small businesses create more jobs. That brings in more investments. It covers a lot of areas.

The role of the ministry which we define is that of an enabler. We are not going in and to pay people to come and trained. If we train people where are the jobs? If after the training, they do not get employed, relative deprivation would set in. That means you take somebody up and bring him down. That has been the problem.

 We must create competitions among the youths.  We must create opportunities and competitions so the children of the Permanent Secretary or Commissioner, here at Alausa and the children of the shoe maker in town will have equal opportunities to compete for available job opportunities.   We must create opportunities. We must create a competitive environment. It is the only way we solve this problem. Like I told you, the problem was also exaggerated warranting all kind of government interventions which could not work because there were no constructive engagements with the private sector.

 Tax payers’ money was being used in attempts to create employment.  In the process, all the people government trained, none of the people trained by government have jobs? This is because of the poor quality of training. Government is not in the best place to train. The training was done poorly.  It was a predictive process. We know what was going on there at the toll gate with personnel employed by SURE-P. If an enabling environment has been created with the private sector and this is reinforced with revision of the educational curriculum and then further reinforced by youth centres with cognitive orientation, the story would have been different. The failure to harness these cognitive values that reinforced formal education has revealed  why our  youths lacked creative ideas to harness the advantage of technology  transformation  when it came on the scene .

 Goals and Strategies

We are creating conditions where jobs can be created and the private sector contribute to growth.  We have a lot of constraints. As I said earlier, it is not as bad though government failed to fill in the gaps with its interventions. We have a lot of social entrepreneurs coming in to fill the gap.  There are a lot of success stories. We have Andela. We have West African Vocational Education (WAVE).  We have international development organisations .We have a lot of the private sector. We have skilled centres. The Nigeria Employers’ Consultative Association (NECA) has also been up to the task.

Nigerian Breweries Plc has a training centre; Julius Berger Plc has a training centre. Nestlé Plc has a training centre. Companies are establishing their   training centres, in an effort to enable staff to increase skills of their employees at various levels of production. The fact that industry employers are establishing training centres demonstrates that products from the government’s training programmes do not meet their requirements and make their products employ. We are having a constructive engagement with all these people. We are right now working with NECA and the International Labour Organisation (ILO) on skills acquisition for youths and employment creation in the State. We are coming up 10 to 12 areas for collaborative engagement to create employment and looking possible employment outlets. Not only in terms of filling in the gaps, but in skills acquisition and entrepreneurship. We are also looking at employment creation outlets that we can key into. We have had meeting with Nigerian Association of Small Scale Industrialists (NASSI).We had constructive engagement with them. We do not wait for them to come. We go out to meet them because that is the sort of environment that we are trying to create. Also the government has to be entrepreneurial in approach. We know what they are doing. If we work with them and give that endorsement, then our youths will have more.

  In choosing the participants, we work with the Local Government Councils because they provide a platform with a wide reach. 300 youths registered for the programme. 80 persons were shortlisted. Out of the 80 that started the programme, only 22 finished the programme.  At the end of the programme, we had a review meeting and we discovered that the problem is that our youths are not ready to work. They still want to get things as in the past. This is the challenge. How do we address this? This is why the mindset orientation comes in. For example, out of the 22 participants that finished, about 18 got employment on the spot. After the two weeks programme, we have one week sort of internship. The internship period was like probation. The conclusion from our findings is that some of them were not ready to work.

We recognise that the government is not very good in creating jobs. One thing I should let you know is  that the Lagos State Governor Akinwumi Ambode has committed N25 billion over the next four years to job creation. The money is to be judiciously expended in creating employment.

Knack to help the Unemploy 

In order to achieve this, he created a N25 billion employment trust fund to cater for employment and wealth creation projects in the state. The governor inaugurated a board which is more private-sector driven. Most of the entrepreneurs will have access to the fund as long as they meet the necessary requirements and there will be an equal opportunity for everyone, especially budding entrepreneurs with new idea.  We are also represented on the board of the State Employment Trust Fund (ETF). On the board, you have youth entrepreneurs, representatives of artisans and civil society. The composition of the board is quite interesting and will be subjected to a lot of accountability. Its accounts will be published on a quarterly basis. Members of the ETF board were carefully selected based on their track records and professional integrity. The board is being led by a former Chairman of the Federal Inland Revenue Service, Ifueko Omoigui-Okauru. I can assure you the fund is supported to assist small scale businesses, entrepreneurs, and also as subventions to expand the environment. The N25 billion Lagos Employment Trust Fund (ETF) will widen opportunities for self-employment for persons with business ideas and entrepreneurial skills. It is a revolving fund. The interesting thing is that the loan will be given out at three percent interest rate with a little management fee.

At the end of the day, it will be affordable because there is no way in the country that Small and Medium-sized Enterprises (SMEs) will get such lower interest rate. Not even the Bank of Industry (BoI).The other fact is that it will be accessible to entrepreneurs across the three senatorial zones and five divisions of the state. The trust fund will come in the next thirty days. It is not easy to be shouldered with such kind of responsibility.

People are looking at you to perform. You have to set up machinery to be able to do that. The government will commit N6.25 billion every year within the four years of this administration to a total of N25 billion. Already, they have N6.5 billion for the first year. I believe it will have a lot of impact. The state   government intends to make the trust fund independent because of accountability. We also know that the payment processes could subject it to government interference. That is why the trust fund was created by an Act. The Chairman and Sectary were ratified by the State of House of Assembly.

The Trust Fund is not an appendage of the ministry. So let them come up with their plan so we can disseminate it to the public. They are answerable to Nigerians. They are answerable to our legislators directly.

Because of the institutional policy framework within the state, this ministry is represented there. Because it involves tax payers funds, that is why the Commissioner of Finance is represented.

They are the only two government representatives there. The law establishing the fund is also explicit in terms of sanctions. That is why the board has to give quarterly report which will be published in two major newspapers,. Their statement of accounts and activities can be questioned. You can be sure their activities will be closely monitored by the Lagos State House of Assembly. We will guide them in term of the state government policy. I can assure you that they are working on the right track