NIQS: Corruption Threatens Sustainability of Nigeria’s Mortgage System

Nigeria’s mortgage system is being undermined by pervasive corruption in the housing and financial sectors, making homeownership increasingly unachievable for many individuals, according to a warning from the Nigerian Institute of Quantity Surveyors.

Azeez Ayodabo, the General Secretary of the Nigerian Institute of Quantity Surveyors, has therefore called on the Federal Government to reconsider its mortgage system regulations.

In honor of the Nigerian Institute of Quantity Surveyors’ golden jubilee celebration, he made this announcement during a press conference held at the Lagos Chapter.

“The government should review its policies to make mortgage access more flexible,” he added. The thresholds ought to be modified based on the various income groups. Mortgage loans have to be accessible to people according to their income. For example, a level six or level seven civil servant should not be expected to purchase a three-bedroom maisonette advertised by the government. It is not practical. Bungalows, apartments, terraces, and duplexes should all be included in housing designs so that residents can select what best suits their budget. In this manner, everyone—not just the wealthy—benefits. The dearth of information is another issue. Depending on the applicant’s age and income, the Federal Mortgage Bank of Nigeria offers long-term mortgage windows of up to 30 years, however this information is not commonly accessible. Furthermore, corruption has permeated every aspect of the mortgage market. To obtain loans intended for the general public, many people take advantage of contacts with the government.

Thus, the mortgage system has indeed been undermined by corruption. For example, government housing loan recipients were required to construct and market three-bedroom bungalows for N7.5 million between 2006 and 2009. Even after subscribers began making payments through mortgage deductions from their salaries, many instead misappropriated the funds and failed to deliver the residences. Because of this, the government was forced to discontinue that mechanism and assume direct authority over mortgage applications. Therefore, it is not just the government that is to blame; citizens too have a part to play.

In terms of cost-effectiveness, we believe that hiring quantity surveyors is necessary. One of the most common errors committed nowadays is hiring QSs for a portion of a project merely in order to create the Bill of Quantities, and then excluding them later. Wastage and a lack of cost control result from this. In order to guarantee quality and avoid cutting corners, the QS is essential. For example, if the contractor replaces the required 16 mm reinforcement with a lesser grade, a quantity surveyor on site can detect this through documentation checks and valuation. This establishes responsibility and guarantees the integrity of the project. The quantity surveyor plays an extensive and vital role. Therefore, we implore the public and the government to identify and involve the appropriate specialists in their appropriate roles.

Speaking about the value of quantity surveyors, the chapter chairman, Rilwan Balogun, pointed out that they needed to be more deeply involved, particularly in infrastructure.

progress.

“Too often, their expertise is limited to building projects, while there are enormous opportunities in heavy engineering, civil engineering, oil and gas, and other major infrastructure sectors,” he clarified. The call to action is for increased inclusion since government and private clients can assure economic efficiency, promote transparency, and obtain better value for their money by forming consortiums.

“The Renewed Hope Agenda of the current government aims to reposition the economy, but without the technical and financial discipline that QS consortiums bring, this goal cannot be realized.” Projects like the Lagos–Calabar Coastal Highway are controversial, which emphasizes how crucial early QS engagement is from conception to completion. Consortiums could have prevented problems with exorbitant expenditures and a lack of transparency if they had been involved from the start. The crucial checks and balances that guarantee cost control and accountability are gone when engineers are the only ones who plan, estimate, and carry out the project.

The continuous argument between the Bill of Mechanical and Electrical and the Bill of Quantities also reflects this imbalance. Instead of the BME, which is solely utilized in Nigeria, the BOQ, which is created by a quantity surveyor or cost engineer, is the internationally recognized document. While BMEs frequently lack depth and clarity, a well-prepared BOQ is thorough, transparent, and detailed, detailing every nail, bolt, and reinforcement required for construction. While BME documentation may result in significant differences and waste, the BOQ guarantees accuracy and restricts cost fluctuation to roughly 5%. Therefore, it is important to reiterate that the primary duties of a quantity surveyor are cost estimation, appraisal, and control.

The idea that quantity surveyors play no part in building collapse is incorrect. By outlining material requirements and workmanship standards within the BOQ, QSs really serve a preventative purpose. Regrettably, in order to save money, contractors or clients may get around these requirements by utilizing inferior materials or fewer reinforcements, which ultimately jeopardizes structural integrity. As a result, the government ought to require BOQs to be submitted as part of the construction approval procedures. This would lessen the number of abandoned or subpar buildings by enabling authorities to evaluate both the project’s cost and the developer’s financial ability to carry it out. QSs’ essential role in guaranteeing quality and safety in the built environment is further supported by their membership in the Building Collapse Prevention Guild.

The Deputy Chairman, Femi Falusi, pointed out that the difficulties become more complicated with the development of technology.

“As my chairman correctly noted, with the advancement of technology, many allied professionals now believe they can perform the work of QSs,” he stated. As a result, there has been extensive intrusion into our workspace. Since QS software is now available, some non-QSs try to conduct cost estimating tasks and create bills of quantities using it. As a result, there are now more professionals and outsiders vying for fewer open positions, which has increased competitiveness.

We are pushing for more robust policy measures to address this. We hope to change government policy through programs like the DLA so that all bills of quantities or cost estimates submitted for building approval have to be written and stamped by a qualified quantity surveyor. Enforcing such a policy will assure responsibility and assist prevent professional invasion.

Lastly, we acknowledge that technology is here to stay as we consider the future. It offers chances as well as difficulties. In order to improve their professional competence and stay relevant in this changing business, we at the chapter level continue to push our members to utilize digital technologies, embrace innovation, and upskill.