FEATURES: A New Lease of Life for Policemen

New Police Estate at Idimu, Lagos

The deplorable state of police barracks across the nation has been of concern to many, especially the police authorities, Chiemelie Ezeobi writes on the current efforts of the Nigerian Police to turn the tide.

For many years he served meritoriously as a police officer. He had lived in the most dangerous part of the city where he continued to expose his family to the risk of the environment in which he lived as a serving police officer. After sometime he managed to get an apartment inside the police barracks, but the apartment was not in any way befitting for an officer of his rank. Unfortunately he died during a crossfire with armed robbers. So he died without having a house of his own and thus left his wife and five children without a roof over their heads. That was the story of a Nigerian police officer.

For the Police, the dream to own a house or an apartment has always been there. In most cases they die without fulfilling that dream.

It would simply be stating the obvious to say that the living conditions of the police in the barracks are at best deplorable. Years of alleged mismanagement and paucity of funds further deteriorated several barracks across the country, therefore making life unbearable for personnel of the force.

Having analysed this situation, the current Inspector General of Police, Mohammed Abubakar, recently set the ball rolling in ensuring that its serving personnel who would one day retire are provided with affordable housing.

As part of such current efforts, a police mortgage bank called the Nigeria Police Savings and Loans Limited (Mortgage Bankers) presently known as FOKAS Savings and Loans Limited (Mortgage Bankers) was floated.

As part of the retirement plan that guarantees a roof over every officer’s head, both now and in the future, FOKAS has been designed as the veritable vehicle that would deliver such homes to all police officer.

THISDAY authoritatively gathered that the initiative would cater for all personnel of the force irrespective of rank. Accordingly, it has been packaged to give priority attention to members of the rank and file who are considered more vulnerable in terms of housing needs.

Promise Fulfilled

In the words of Abubakar, "food and shelter remain tops on man’s hierarchy of needs, therefore, every police officer needs and deserves not just a temporary shelter but a modest home of his own."

In fulfillment of such plans, the IG recently inaugurated 200 units of three-bedroom flats constructed for officers and men of the police force in Lagos.  The housing estate located in Lagos was named after President Goodluck Jonathan.

According to the IG, the initiative would cover other parts of the country in order to address deficit in housing for officers of the Nigerian police across the country.

But while the housing estate unveiled by the president in Lagos was built through a Public Private Partnership (PPP) arrangement spearheaded by the federal government, the new housing units being planned by the police authorities according to the IG would be funded by the police mortgage bank at a more subsidised rate.

Speaking to THISDAY, the Force spokesperson, Frank Mba, a Chief Superintendent of Police (CSP), said the initiative is in line with the federal government plan for every worker to own a home of his own and for which the National Housing Fund (NHF) was established in 1993.

According to him, every person employed in Nigeria contributes a percentage of his basic salary to the NHF which entitles the worker to access a loan facility from the Federal Mortgage Bank of Nigeria (FMBN), the custodian of the nation's housing fund.

However, he said loans from the FMBN can only be accessed through established mortgage banks otherwise called Primary Mortgage Institutions (PMIs).

Mba disclosed that the Nigeria Police Force (NPF) subscribed to the NHF during the administration of IGP Ibrahim A. Coomassie in 1994 and subscribed  to the deduction of NHF contributions from officers and remittance of same to the FMBN.

He noted that it soon led to the establishment of the NHF desk within the force to harmonise/reconcile deductions and remittances and thus far, he disclosed that the NPF remains the highest contributor to the FMBN till date with the remittances put at approximately N8billion naira and still counting.

Despite the laudable feat, Mba however lamented that the police are yet to benefit from the facilities available at the FMBN under the NHF Act unlike other agencies and cooporate groups which he said benefit from huge contributions of the police.

He further explained that the reason was partly because the police could not float a mortgage bank to easily access the required loans for its officers and men, and efforts over the years were stalled by administrative instabilities generally occasioned by frequent leadership changes.

Besides other technicalities and statutory requirements by the Central Bank of Nigeria (CBN) and other regulatory agencies, he said the capitalisation sum of N2.5billion for one state branch or N5billion for a national branch is required before a mortgage bank can be licensed.

Mba said considering the interest of the police in accessing its huge contributions to the NHF, an entirely owned mortgage bank is needed to maximally protect the long-term housing initiative for the future.

Despite the hitches, he listed the options open to the force to include sourcing for the required fund and floating an entirely new mortgage bank, acquiring an existing bank and recapitalising it appropriately.

Others include, incorporating a PMI company with the Corporate Affairs Commission (CAC) and still undergoing the process of capitalisation, where, acquiring an existing PMI according to him was the most cost effective.

FOKAS to the Rescue

The FOKAS Savings and Loans Limited (Mortgage Bankers) was existing PMIs with equity shares of two hundred and seventy million shares, but with technical guidance and following corporate negotiations, the Nigeria Police Cooperative Multipurpose Society Ltd acquired two hundred and fifty million shares from the total equity shares of the company amounting to 93 per cent of the FOKAS.

The initiative thus guarantees a comfortable home for every officer of the NPF yielding results within the next one year and continuously after.

THISDAY gathered that the acquisition totally ceded the ownership of FOKAS Savings and Loans Limited (Mortgage Bankers) to  police cooperative and having acquired an existing PMI, Mba said what was left was to capitalize the new PMI in line with CBN guidelines.

And as such, every contributor to the NHF is entitled to a mortgage loan of N15m to build, purchase or renovates homes within a maximum repayment period of 30years and attracts a minimum interest of 6 per cent and maximum of 8 per cent per annum throughout the loan tenure which translates into affordable monthly loan servicing deductions for the beneficiary.

While stressing that no additional collateral is required to obtain the loan as the home for which the loan is obtained serves as collateral, he said individual police officers can on their own, through the PMB, easily obtain the stipulated loan from the NHF.

Mba noted that while the dream was to get a house for all officers, every officer irrespective of rank is entitled to a loan of up to N15m at a single digit interest rate not exceeding 8 per cent and repayable over a maximum period of 30 years, to build his own house, renovate his property, purchase a piece of land and purchase a house either independently or through the Police Housing Scheme.

He said the minimal subscription of FOKAS shares for which N11,000.00 is being deducted, is also across all ranks including the  IGP, DIGs, AIGs and CPs down to the last Constable and therefore every police officer is a part owner of the PMB  and will be issued share certificates for the minimal subscription as well as for additional subscriptions.

Capitalisation of PMB

The Force spokesperson said to capitalise the bank, a private placement offer for the shares of FOKAS Savings and Loans Limited was issued at the rate of N1.10k per share for 2,500,000 ordinary shares valued at N1.00 each.

And as such, sensitisation initiatives commenced with State/Zonal Recapitalization Committees constituted to educate officers and men on the benefits of the scheme which led to subscriptions to the offer by officers and men across all commands and formations of the force.

He said the funds derivable from the capitalisation initiative will enable the recapitalisation of the Police Mortgage Bank on a National Mortgage status and on payment of the stipulated capitalisation sum to the CBN, the name FOKAS Savings and Loans Limited will be changed to the Nigeria Police Savings and Loans Limited (Mortgage Bankers).

According to Mba, the precondition for licensing of the PMB included opening of a branch in Lagos and Abuja to augment the existing Abeokuta branch inherited from the acquired FOKAS Savings and Loans and reconstituting the FOKAS board to reflect its new ownership.

He listed the board members to include Mr. Adeloye as Managing Director; ACP J.O Gbenike as representative of Police Budget Department, CP Jalingo (rtd) as representative of retired officers and others drawn from the police cooperative society and the police NHF.

He said they were also able to increase the equity base of the bank from the initial N500million (FOKAS) to N3billion as well as recapitalised the bank from its current paid up capital of N500million to N2.5billion for one branch or N5billion for a mortgage bank with national branches.

The Package

Fully aware of the challenges facing retiress, Mba said the IG prepared the package in such a way that all officers would be part owners of the Police Mortgage Bank (PMB) as a well-thought-out retirement plan to enable every officer access the housing loan and acquire a home of their own.

According to the IG, the initiative which is a perfect retirement settlement plan would asides fulfilling the housing needs of officers, help combat corrupt tendencies within the force  and provides an enabling environment for efficiency and meritorious service .

As against the fray the announcement stirred up in the force, he clarified that the package requires individual officer’s minimal subscription for 10,000 ordinary shares of the FOKAS Savings and Loans limited (Mortgage Bankers) which is now the property of the Nigeria Police Cooperative Society.

He said: "The total cost of minimal subscription is put at N11,000 only, payable in two installments of N5, 500 each, at the rate of N1.10K per share and the process  automatically guarantees part-ownership of the bank by every serving police officer.

“Subsequently willing officers are at liberty to increase their subscriptions. Currently, subscription forms are on distribution across all commands and formations of the force to enable them appropriately regularise the minimal subscription already deducted and harmonise earlier subscriptions."

In case of default, he said a committed task force has equally been constituted to ensure fast and early issuance of share certificates to all subscribing officers.

As to the benefits of the PMB, he said payments of loans may be structured throughout the remaining part of an officer's career with the Force and even after retirement and even upon death or incapacitation, dependents of an officer would never lose their homes as the bank will accommodate convenient repayment plans by the deceased officer’s family.

He said: "Contrary to fears, the benefits are numerous and being the highest contributors to the NHF, accumulated contributions of officers can easily be accessed to develop several hundreds of homes simultaneously at different locations, for officers and men of the Force.

"Retiring officers needing a refund of their total contributions to the NHF and who did not obtain any loans or benefit from the housing scheme can easily, through the PMB, recover such entitlements in line with the provisions of the NHF Act."

The Procedures

Mba said there are strict procedures to be adhered to including the fact that the applicant must be a contributor to the NHF for a minimum of six months, as well as have satisfactory evidence of regular flow of income to guarantee repayment.

He added that they must have at least, three years tax clearance as at the time of requiring the loan, their three months pay slip, FMBN (NHF) updated passbook, letter of offer/letter of acceptance if applicant is purchasing property or land from a developer or individual. There is also that part that include age declaration and other minor requirements which the Police NHF office can help obtain.

Mba noted that while officers might be reluctant to shell out their money, it was pertinent to ask whether it is wise for police officers to continue contributing to the NHF without benefiting from it and if influenced by the dissenting voices, the police would lose the N8billion jointly contributed by all to the FMBN.

He said: "Do Police officers and men not deserve to have their own houses? Should we continue to lose the immense benefits inherent in having a Police Mortgage Bank (PMB) through minimal subscription and acquisition of shares by all officers with just N11,000.00 each?

"These are the questions the IG and his management team have considered and which led to the steps being taken to improve the welfare of all police officers. This initiative is dreams come true for personnel of the NPF especially members of the rank and file.

"Imagine owning a house of your own just by subscribing to the PMB. Today, we all make the commitments to be part-owners of the bank and tomorrow, we shall live in our homes"

But while the deal might sound juicy in paper, the jury is still out on whether the police would deliver all these promises to its personnel which would in turn enable them to be better citizens.