The Nigeria Employers’ Consultative Association has said that the closure of the factories of some major manufacturing companies in Lagos by the Lagos State Water Regulatory Commission on the allegation of non-payment of water abstraction levies has the damaging potential of scaring away investors.
NECA also stated that the move has the potential to aggravate employees’ apprehension about the security of their jobs and portray the state as unwelcoming for legitimate businesses.
The Director-General of NECA, Mr. Wale Oyerinde, disclosed this in a statement obtained by The PUNCH on Wednesday.
He urged LASWARCO to toe the path of support for struggling businesses and stop what he described as an ongoing misinformation and media onslaught, “which is tantamount to economic sabotage.”
According to him, the purported news of the sealing of the premises of some businesses on the allegation of non-compliance with water abstraction regulations was not only misleading but likely to send the wrong message on the already harsh business environment in Nigeria.
“The reported comments and activities of the commission have the damaging potential of scaring away investors, aggravating employees’ apprehension about the security of their jobs, and portraying Lagos State as unwelcoming for legitimate businesses,” Oyerinde said.
He pointed out that all these are coming at a time when many multinationals are either exiting the country or carrying out a global restructuring with Nigeria and Lagos especially being one of the hardest-hit nations/states in divestments and job losses.
“It is no gainsaying that businesses have faced probably the harshest economic situation in recent times, with many declaring humongous losses.
“It is, thus, expected that the commission will be innovative enough to come up with legitimate ways to generate revenue without adding to the woes of businesses by demanding unjustifiable multimillion amounts as water abstraction levies from businesses that already pay many other forms of taxes for the same activities, they use the water for,” he said.
The NECA DG averred that it is the responsibility of the government to provide water for its citizens and businesses.
However, Oyerinde added that in a situation where the government fails to fulfill the responsibility for whatever reasons, “it will be highly insensitive, harsh and punitive for the same government that has failed to adequately provide water to also impose punitive levies on businesses that are constrained to make investments in providing water to run their businesses.”
Oyerinde noted that the action of the commission is more worrisome because there is an ongoing engagement with a section of the Organised Private Sector to amicably resolve the issues.
He reiterated that while some companies had been compelled to pay in the hope of avoiding disruption to their operations, NECA counsels against the unhelpful tactics being deployed by the commission.
“It should be noted that organised businesses are not against responsible regulation, however, we will embark on all legal and legitimate means to resist any form of high-handedness that does not demonstrate empathy with the plight of struggling Nigerian businesses,” Oyerinde warned.
He advised that in the quest for revenue generation, the commission and indeed all other regulatory agencies should adopt a more legitimate and civil approach, rather than the predominant disruptive pattern of recent times, “which are directly against the efforts of the Federal Government to attract investment, promote job creation and facilitate responsible regulation.”
He appealed to the Lagos State Governor, Babajide Sanwo-Olu to intervene in the matter to save businesses in Lagos from further woes.
The PUNCH earlier reported that the Lagos State Water Regulatory Commission sealed three companies for extracting large quantities of groundwater for commercial purposes without proper authorisation and compliance with regulations.
According to the report, the affected companies include the Nigerian Bottling Company, producers of Coca-Cola; FrieslandCampina, makers of Peak Milk; and Guinness Nigeria Plc.
The Director, Technical Services, LASWARCO, Mr Olowu Babatunde, said this during an enforcement on Tuesday in Lagos.
Babatunde said that LASWARCO had been engaging with these companies for over seven years to encourage compliance but efforts have been met with limited success.
