Lead debate by Senator Gbemi Saraki on the second

reading of skills Acquisition and Development Trust Fund

Bill (2007).

As a nation, we are not investing sufficiently in education and

training for all Nigerians. According to figures supplied by the
Federal Ministry of Education, 67 percent of the Nigerian
population is illiterate. 42 million children are eligible to attend
primary schools but only 22 million children actually do so. The
trend continues in secondary and university levels with 2.8
million out of an eligible 33.9 million attending secondary
schools in Nigeria. Out of 5.8 million youths who desire a
university education, only 1.8 million students are registered.
Years after graduation, many graduates remain unemployed or
are not employed in the trade for which they were trained. A
case in point is a graduate in Mechanical Engineering who
informed me that impressive as it sounds, his course has been
obsolete for 15 years and that he is incapable of engineering
work. There appear to be three reasons for this:

• limited growth and labour demand in the manufacturing

sector

• mismatch between the skills attained and those actually

in demand; and

• mismatch between the skills taught and the graduates

own labour market objectives.

In recognition of this problem, numerous agencies have been

charged with or have imposed upon themselves, the
responsibility for skills development, poverty alleviation and
employment generation including the National Directorate for

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Employment (NDE), Centre for Management Development
(CMD) and Leadership and Vocational Training Centre. Various
NGOs and organisations occasionally conduct similar
programmes in recognition of this desperate need. As recently
as two weeks ago, NNPC was reported to have allocated N 100,
000, 000 to the training of 120 youths under its Youth
Empowerment Scheme in an effort to positively engage the
youth of the Niger Delta. However, budgetary constraints, limited
reach and access and the often specialized and localized
interests of NGOs and organisations must necessarily limit the
impact of NGO-led initiatives. To make a meaningful difference
in the provision of priority skills, the initiative needs to be driven
by common national intent.

Thus far, the preoccupation with providing training has resulted

in the government neglecting the key role of providing
information about the availability and effectiveness of training
programmes. The persistence of this problem is obvious. To this
end, the Fund will widen the hitherto limited focus of job creation
and take a holistic approach encompassing job creation as well
as ensuring that competent and well-trained staff are available
for recruitment to these positions. The Fund will also serve as an
umbrella under which all such bodies, agencies and
organisations can operate in tandem, with the Fund providing
financial assistance and direction to these organisations. Thus
providing a structure whereby social partners are able to work
together towards these goals without one usurping or duplicating
the functions of the other.

The Fund will launch a systematic process including all key

stake-holders and role-players to result in concrete proposals for

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high-priority skills areas which have been identified for
immediate attention. These include but are not limited to:

• training in the latest information technology skills;

• training for environmental careers with an emphasis on

waste disposal and energy including bio-diesel research
and production;

• city, urban and regional planning;

• artisan and technical skills, with priority attention to

infrastructure development, housing, and in other areas
identified as being in strong demand in the labour market;

• management and planning skills in education and health;

• mathematics, science and language competence; and

• development of small, medium and micro enterprises.

It should be noted that the Bill envisages the involvement of the

international community to train people in foreign academic
institutions and for international placements, as witnessed in
South Africa’s partnership with Japan, Australia and Ireland
under their Joint Initiative For Priority Skills Acquisition (JIPSA)
programme (established in 2006 and empowered by the
Accelerated Shared Growth Initiative for South Africa) which is
chaired by the South African Vice-President.

In 1994, the newly elected democratic government, led by the

African National Congress (ANC), inherited a country of gross
racial inequities with structurally high unemployment. The
apartheid system had been intentionally constructed to provide a
steady stream of cheap black labour for all sectors of the white
economy, creating two economies within the country. The first
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being an advanced, sophisticated economy, based on skilled
labour, which is becoming more globally competitive. The
second, a mainly informal, marginalised, unskilled economy,
populated by the unemployed and those unemployable in the
formal sector. This dichotomy also exists in Nigeria. Each week
day, hundreds of thousands of corporate employees fill the
streets of Nigeria on their way to well-paid jobs in our banking
halls and our glossy office complexes while their neglected
counterparts languish in penury.

The Skills Development Act adopted in 1998 established 27

separate Sector Education and Training Authorities (SETAs),
one for each economic sector. Members of SETAs include trade
unions, government and councils. Each SETA develops and
implements a skills development plan and pays out development
grants. Since April 2000 a levy of 1% of the annual payroll has
been imposed on all companies registered with the South
African Revenue Service or having an annual payroll of more
than R250,000 (N 4,290,000). Of the money raised, 80% is
distributed to the SETAs and 20% goes to the National Skills
Fund, which develops projects that do not fall under SETAs.

Distinguished Senators, this example merely places our

employment drive in its proper context. I am not suggesting by
any means that we duplicate the South African model. As a
sovereign nation, we must adopt whatever measures suit our
particular terrain. However, I implore you to be inspired by this
example. Also be mindful of the level of funding and dedication
that is required to make a success of initiatives of this nature.

Economies that have a similar Bill such as India, Sri Lanka,

Malaysia, Japan, Ireland and New Zealand are proof that an
economic revival must have a skills revolution at its core. In
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America, the Services Acquisition Reform Act was passed in
1837. The Philippines is now ranked as the world’s top supplier
of seafarers with more than 160, 000 Filipinos employed on
board vessels of various nationalities making the seafaring
industry the Philippines’ fourth major dollar earner and this $1.7
billion industry is still growing at a rapid rate (annexure attached
for facts about skills acquisition programmes conducted in India,
Germany, France, Singapore, Malaysia, Chile and Argentina).

The impact of globalization is constant and permanent.

Knowledge is growing exponentially and changes - technological
and otherwise - will accelerate. This exciting new time demands
new skills and knowledge but many Nigerians are unable to
participate. Nigeria’s transition to a knowledge-based economy
requires a new generation of educated and skilled people. Its
competitive edge will be determined by its people’s ability to
create, share and use knowledge effectively. A knowledge
economy requires Nigeria to develop workers who are flexible
and analytical and who can be the driving force for innovation
and growth.

While being a labour and productivity issue, no skills acquisition

programme can ignore education, hence the inclusion of a
representative of the Federal Ministry of Education on the Board
of the Fund. However, the problem of unemployed youths in
Nigeria stems from the emphasis on university education at the
expense of areas such as technical and vocational education.
Secondary school graduates with a strong academic
background suffer a high rate of unemployment and school
curricula should be changed to reflect this. Nigeria needs a
flexible educational system: basic education to provide the
foundation for learning; secondary and university education to
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develop core capabilities and core technical skills; and a further
means of achieving lifelong learning. The education system
must be attuned to the new global environment by promoting
creativity and improving the quality of education and training at
all levels.

In a globalized economy, a large pool of skilled workers is

indispensable for attracting foreign direct investment.
Developing skilled workers enhances the flexibility of the labour
market; skilled workers are more easily absorbed into the
economy and their job mobility is improved thus reducing skills
bottlenecks. It is crucial to make this investment if Nigeria’s
economy is to develop and be competitive in world markets.

Led by a Management Board, the Fund will be charged with

defining the challenges, aligning stakeholders and identifying
appropriate resources to respond to these shortages to fast-
track skills development. This will in turn promote economic
growth and increase labour absorption. It will dramatically
reduce the rate of unemployment which cuts across all age
groups, educational strata and geographical entities and has left
an alarming percentage of our economically active population
without gainful employment. On an individual level, the physical
repercussions on the affected individuals are obvious but the
damage to the psyche can not be over emphasized. At the
national level, unemployment can be categorized as one of the
serious impediments to social progress. Apart from representing
a colossal waste of a country's manpower resources, it
generates welfare loss in terms of low output leading to low
income and a meagre quality of life. This inability to make
optimal use of our abundant human resources has resulted in

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endemic poverty, stunted societal development, a decline in
moral values and a rising crime rate.

Tenuous as it may seem, many of our nation’s problems stem

from low productivity; a direct result of poor labour compensation
(in terms of remuneration and motivation), inadequate training,
lack of technical knowledge and equipment and inadequate
provision of opportunities to display talents and initiatives. The
practice of employing expatriates to fill our skills gaps is the easy
way out and is a short-term measure at best. Investment in its
citizens is an important factor in any country's productiveness.
Thus, the need to put in place a systematic manpower
development programme of the skill acquisition type both in the
public and private sectors is imperative.

It is believed by one school of thought, that our Constitution

assigns legislation on matters relating to vocational training to
State Houses of Assembly. I take this opportunity to respectfully
correct that erroneous assertion. The provisions of the
Constitution are unequivocal in this regard and empower both
the National Assembly and the State Legislatures to legislate on
various types of education, including skills acquisition

In order to achieve this, the Bill under reference proposes a

concerted approach ensuring that N 1.89 billion is earmarked to
aid unemployed Nigerians.

Section 1 of the Bill establishes the Skills Acquisition and

Development Trust Fund and endows it with legal personality.
Section 2 of the Bill establishes for the Fund, a Management
Board and describes the constitution of same. Section 3
describes circumstances under which members of the Board
may resign or be removed. Section 4 makes provision for
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allowances to be paid to members of the Board. Sections 5 and
6 list the functions and powers of the Board. Sections 7 and 8
make provisions for the appointment of an Executive Secretary
and fix the tenure of the said appointment. Section 9 provides for
pensions and other retirement benefits for employees of the
Fund. Sections 10 to 15 make financial provisions from sources
of funding to auditing and reporting. Sections 17 to 20 make
provisions in the event of a suit being instituted against the
Fund. Section 21 empowers the Fund to use the services of
qualified persons other members of its staff. Section 22
empowers the Fund to make regulations subject to ministerial
approval. Section 23 is an interpretation clause. Section 24 is
the citation.

Most developing countries have a short window of opportunity to

maximise skills acquisition before their record number of youth
become middle-aged, and they lose their demographic dividend.
This isn’t just enlightened social policy. In the words of
Emmanuel Jimenez, Director of Human Development in the
World Bank’s East Asia and the Pacific Department, “It may be
one of the most profound decisions a developing country will
ever make to banish poverty and galvanise its economy.”