The CRFFN has struggled to pay its workers salaries since the turn of the year, accumulating backlogs running into close to ten months of unpaid salaries. In this report, TOLA ADENUBI looks at how regulatory and administrative lapses may have derailed the Council’s fortune.
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The ongoing reforms by the Federal Government aimed at increasing efficiencies, improving transparencies and adding value to the economy of the nation was extended to the freight forwarding sub sector, thus giving birth to the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN).
The CRFFN Act No. 16 2007 was enacted into law on the 30th of April,2007 and was charged with, amongst other responsibilities, to regulate and control the practice of freight forwarding in Nigeria, and promote the highest standards of competence, practice and conduct among members of the profession.
Also top of the responsibilities of the CRFFN includes but not limited to the following: setting standard, building capacity and ensuring freight forwarding industry contributes its quota to the growth of Nigeria’s Gross Domestic Product (GDP); building professional capacity in freight forwarding and supply chain management in order to enhance Nigeria’s competitiveness; Maintaining registers and publishing lists of authorised freight forwarders in accordance to the Act; Maintaining cargo movement statistics, which shall be made available to registered members and the public; Regulating and controlling individuals engaged in freight forwarding activities effectively amongst others.
However, recent happenings have seen the Council struggle to pay its workers salaries, thus leaving a gap in the enforcement of its major roles and responsibilities.
WHY THE STRUGGLE
Speaking with the Nigerian Tribune, a former President of the National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Eugene Nweke fingered over-bloated staff structure, wrong categorization, political interference amongst others as the major reasons why the CRFFN has struggled to function properly.
Dr. Nweke who also doubles as the Research Director at the Sea Empowerment Research Center stated in a letter addressed to the Minister of Marine & Blue Economy, a copy made available to the Nigerian Tribune, “The following fundamental administrative concerns and factors are responsible for the present state of the Council:
“Wrong categorisation of the CRFFN as an agency of the Federal Ministry of Transportation courtesy of a sponsored legal interpretation of the Act 16, 2007 by the then Attorney General Of federation instead of an independent professional regulatory council.
“Also, the CRFFN had wrong administrative structures which included excessive offices/staffing; Over bloated Governing Board membership (over 30 members); Political Interest overriding professional interests, courtesy of geo -political representations by core politicians without core professional knowledge; and overstretched agencies representations in the governing board.
“Furthermore, the electoral process into the governing Board have so far been driven more by selfish and political interests devoid of professional interests. There is high government interests and interference in the board chairmanship election’s, thus, portraying a professional council headed by a non-core practicing professional.
“In the area of funding, instead of occasional government assistant, we have a quick fix and politically induced full yearly budgeting and allocations, thus down-playing other professional standards means of revenue generation.
“The CRFFN also has very weak and poorly funded enforcement operations and kept embarking on gigantic physical structures above its maintenance capacity.
“Again, other lapses stemmed from Income generated from the Practitioners Operating Fee (POF) going into the Treasury Single Account (TSA), thus making the fund being inaccessible by the CRFFN management as at when needed.
Note that, in all of these creations and applications, there is a cost element attached either as allowances, budgeting, sundries, etc.”
WAY FORWARD
For the former National President of NAGAFF, if the CRFFN will have to break loose from its current indebtedness shackles, the following reforms must sweep through the structure of the Council:
“The Governing Board must consist of a Chairman and 8 or 10 members instead of the current 30 membership Governing Board.
“The Secretariat should consist of an Executive Secretary supported by five to seven staff instead of the current 200 support staff at the CRFFN Secretariat.
“Also, there is need to prune down the Technical Committees to five committees with between 5 to 7 members each instead of the current 10 Committees that exist in the CRFFN with over 5 members each.
“The CRFFN also has to reduce its seven Regional Offices that has 10 staff each to three with five staffs each.”
FUNDING MODELS
For any professional regulatory Council to survive, Dr. Nweke suggested the following funding models:
“Collection of Membership Fees annually from registered freight forwarding companies; collection of License Fees from issuing licenses to operators; collection of small percentage levy on freight transactions, for example, the Practitioners Operating Fees (POF); Government Grant as Initial startup funding or periodic grants; Private sector partnerships which should include collaborations with industry stakeholders; collection of fees from professional training & certification Fees; collection of certification fees from accredited associations; and also make money from sales of professional bulletin/publications.
“Thus, the revenue generation can be broken down in this percentage: Membership Fees (20%); License Fees (20%); Levy on Freight (25%); Government Grants (5%); Private Sector Partnerships (5%); Others (25%).
“Here are examples of successful freight forwarding regulatory councils. These regulatory councils have in their administrative engagements demonstrated effective governance, stakeholder engagement, and industry oversight, promptly:
1. International Federation of Freight Forwarders Associations (FIATA)
2. National Customs Brokers & Forwarders Association of America (NCBFAA)
3. British International Freight Association (BIFA)
4. Freight Forwarders Association of India (FFAI)
5. Australian Freight Industry Association (AFIA)
“Finally, this is a professional clarion call to the Honorable Minister of Marine & Blue Economy to intervene on the state of the CRFFN by instituting a deliberate administrative policy to reform or restructure the CRFFN and reposition it for professional and national wellbeing, in line with the professional regulatory standard framework suggested above.
“In upholding to this clarion call, it is important that the Honorable Minister calls for an action, whereby, most of the CRFFN staffs will be reassigned and absorbed by other agencies of the government.“
