Amid Funding Shortfall, Shippers’ Council Demands 1% Freight Stabilisation Fee

Amid funding challenges, the Nigerian Shippers’ Council (NSC) has called for the Council’s financial independence by activating the one per cent Freight Stabilisation Fee

Speaking on Thursday when the Senate Committee on Marine Transport paid an oversight visit to the council, the executive secretary, Dr. Pius Akutah, said the two per cent funding from the seven per cent Port Development Levy (PDL) is not adequate to meet the scale of the Council’s statutory responsibilities.

Dr Akutah, who urged the Senate Committee to accelerate the enactment of the Nigerian Port Economic Regulation Act (NIPERA) Bill 2025 into law and also championed the Council’s financial independence through the 1 per cent Freight Stabilisation Fee, stated that the PDL lacks firm legislative backing, leaving the Council’s financial base unstable.

The Shippers’ Council boss further stated that enacting the NIPERA bill will consolidate the Council’s mandate, strengthen investor confidence, and ensure effective enforcement of economic regulation.

“At present, the Council relies mainly on the seven per cent from the two per cent PDL as its main funding source. This levy is not only inadequate to meet the scale of our statutory responsibilities but also lacks a firm legislative backing, leaving the Council’s financial base unstable.

“To address this, we respectfully seek your urgent support in two critical areas, which are to accelerate the enactment of the NIPERA Bill into law to consolidate the Council’s mandate, strengthen investor confidence, and ensure effective enforcement of economic regulation; and champion the Council’s financial independence through the one per cent Freight Stabilisation Fee.

“This fee, established under Section I. (3) of 1995 and Section 7(2)(c) of the NSC Act, is not a tax but a statutory service charge for regulatory functions such as tariff monitoring, cost regulation, cargo protection, dispute resolution, and trade facilitation.”

He further explained that the one per cent Freight Stabilisation Fee does not conflict with the Nigerian Tax Administration Act (NTA) 2025.

“Let me stress that the fee does not conflict with the Nigerian Tax Administration Act (NTA) 2025. The Act harmonises collection, but it does not abolish legally established service-based revenue streams.

“On the contrary, this fee complements the unified collection framework, ensuring the Council has sustainable funding while all revenues are duly collected through the Nigeria Revenue Service and remitted into the Consolidated Revenue Fund.

“This model is consistent with global best practice, from Ghana to Kenya to South Africa, and aligns with the WTO Trade Facilitation Agreement, which allows charges proportionate to services rendered. Without this dedicated stream, the Council and NIPERA, when fully operational, risk financial incapacitation, jeopardising both our reform gains and Nigeria’s readiness under AfCFTA.”

He argued that the Council has coordinated transport infrastructure, such as inland dry ports and vehicle transit areas in its bid to expand shipping services to the hinterland.

‘Under the guidance of the ministry and in partnership with the National Assembly, the Council has pursued reforms with measurable impact in streamlining port processes and reducing logistics bottlenecks to ease doing business; Coordinating Transport Infrastructure such as Inland Dry Ports and Vehicle Transit Areas to expand port services to the hinterland; Regulating tariffs and charges to protect shippers and promote transparency; and supporting Nigeria’s readiness for AfCFTA by developing dispute resolution systems, reducing trade costs, and enhancing competitiveness.”

“These reforms, backed by your oversight, reflect our shared commitment to make Nigeria a trade and maritime hub for the region.

Speaking earlier, the Chairman of the Senate Committee on Marine Transport, Senator Wasiu Eshinlokun, stated that the Council’s performance as a port economic regulator and a key driver of efficiency in shipping is central to Nigeria’s economic aspirations.

Eshinlokun stated that the federal government has created a conducive environment for shipping services to thrive through ongoing reforms, policy alignments, investment in port infrastructures and digitalisation.

“The maritime industry, and particularly shipping, is a catalyst for national development. It contributes significantly to job creation, industrial growth, and foreign exchange earnings. Therefore, the performance of the Nigerian Shippers’ Council as a port economic regulator and a key driver of efficiency in shipping is central to Nigeria’s economic aspirations.

“The administration under the leadership of President Bola Ahmed Tinubu has shown commendable commitment to the development of the maritime sector.

“Through ongoing reforms, policy alignments, and investment in port infrastructures and digitalisation, the Nigerian government has continued to create a conducive environment for shipping services to thrive.

“These efforts are geared towards reducing the cost of doing business, enhancing competitiveness, and aligning Nigeria’s maritime industries with international-based practices.

“As a committee, we are determined to support these reforms and ensure that the Nigerian Shippers’ Council continues to deliver on its mandate. Our oversight today will allow us to engage constructively, review progress made, understand the challenges faced, and recommend pragmatic solutions to enhance service delivery and boost economic growth.