Zero allocation to SEC will affect capital market – ASHON

The Association of Stockbroking Houses of Nigeria (ASHON) said that zero-allocation to the Securities and Exchange Commission (SEC) in the 2014 budget could stall capital market development.

Mr. Emeka Madubuike, ASHON President, told the News Agency of Nigeria (NAN) in Lagos recently that the commission might not carry out any capital intensive project this year.

Madubuike said that all the capital market development initiatives aimed at restoring investor-confidence would be affected by lack of funds.

According to him, the capital market committee programmes aimed at taking the market to the next level have remained unrealised due to budget limitations.

Madubuike called for quick resolution of the lingering impasse in the interest of the market.

“The problem should be resolved by the executives as soon as possible to avoid taking the market back and front,” he said.

The ASHON boss, who said that he could not explain how the commission survived in 2013, added that zero budgetary allocation was a threat to the regulation of the capital market regulation.

Mr Olaleye Williams, the Managing Director of GlobalView Consult & Investment Ltd., said that the development had shown that the commission should be a self-sponsoring agency.

“I think the point is being well made that the SEC should not only be a selfregulating regulator but also a self-sponsoring, selfsubsisting revenue centre,” Williams said.

He said that capital market operators needed to be more careful to avoid penalties because SEC would rely on penalties to generate revenue.

NAN reports that the National Assembly had for the second consecutive year, made zero allocation to SEC, even as the two chambers approved a harmonised 2014 Federal Budget of N4.695 trillion.

The National Assembly had also in 2013 budget declined to make any appropriation for the commission.

The budget, which was passed on April 10, had 12 clauses, one of which barred SEC from expending any money unless approved by the National Assembly.

NAN recalls that the National Assembly’s zero allocation budgets followed the impasse between the House of Representatives and SEC.