Non-remittance of revenues by government agencies is a phenomenon that promotes obscene enrichment of civil servants, while public sector finance is in dire straits. This aberration was brought to the fore when two federal agencies made jaw-dropping contributions to the Federation Account recently. It prompted the Federal Executive Council to direct that their past heads be brought to account.
Under focus are the Joint Admissions and Matriculation Board and the Nigerian Maritime Administration and Safety Agency. But they are not the only agencies engaged in this rip-off. At least, 30 agencies were discovered not to have remitted N3.8 trillion of their operating surpluses in the five years to 2008, when a House of Representatives ad hoc committee investigated the scam.
But within just nine months in office, the JAMB Registrar Ishaq Oloyede’s leadership paid N5 billion into federal coffers. Additional N3 billion is underway, which would bring its revenue contribution to N8 billion this year. This is in sharp contrast to the paltry sums the agency contributed before now. The situation is not different at NIMASA. The Dakuku Peterside-led administration contributed N9.97 billion and $38.2 million to the Consolidated Revenue Fund in barely a year, a performance very much at variance with the records of his predecessors. What happened?
Interestingly, the fees candidates pay for JAMB’s examinations have not changed. The Minister of Finance, Kemi Adeosun, who was taken aback, just as other members of FEC, was spot-on with the rhetorical jab, “So, the question the council members were asking was: where was all this money before”?
As Finance Minister, it is incumbent on her to ensure that a scrupulous investigation is carried out, through forensic auditing. And it should be done within a well defined time frame, focusing on the agencies that are cash cows. In JAMB where a registrar stays in office for 10 years, only a highly technical inquest will be able to dredge this swamp way back 40 years. The financial recklessness at NIMASA and Nigerian Ports Authority, well documented in the annual reports of the Auditor-General for the Federation, forwarded to the National Assembly but without any action taken, will come in handy for the probe.
Other revenue spinners include the Bureau of Public Enterprises; Nigerian National Petroleum Corporation; National Communications Commission; National Sugar Development Council; National Agency for Food and Drug Administration and Control; Nigerian Shippers’ Council; Nigerian Civil Aviation Authority; Nigeria Immigration Service; Nigerian Electricity Regulatory Commission and Securities and Exchange Commission, among others.
Absence of controls has ensured that revenues generated by some of these agencies are spent in dodgy circumstances – contract splitting, white elephants, donations and undesirable capital projects. These abuses necessitated government’s resolve to entrench the Treasury Single Account last year. The policy instils accountability and transparency into public finances. The account is domiciled at the CBN. But the agencies bitterly opposed the system; and argued that it was capable of undermining efficiency and service delivery. However, JAMB and NIMASA have given the lie to such an argument. As of March 2017, the TSA had grossed N7 trillion, (equivalent to the 2017 budget), according to the Accountant-General of the Federation, Ahmed Idris.
With MDAs uncontrolled spending, such huge funds at their disposal mean the country running dual budget. Little wonder, therefore, the economy has been hobbled by perennial excess liquidity, compelling the CBN to continually mop up. The apex bank had in April sold N107.64 billion in Treasury bills aimed at soaking up pressure on the naira, thereby checkmating inflation.
No civilised country allows this awkward expenditure template to thrive. Government’s bid to contain the scourge was why the Fiscal Responsibility Act was passed in 2007. The law provides that federal agencies, including the CBN and NNPC, submit their budgets to the National Assembly for scrutiny and approval. However, like the TSA, which the Goodluck Jonathan government first introduced in 2012, but lacked the political will to enforce, so was the FRA. The CBN under Lamido Sanusi as governor, exploited this lacuna to indulge in a rash of donations to institutions.
This bizarre approach to spending operating surpluses appears to be history now with President Muhammadu Buhari’s enforcement of the FRA last year. The budgets of CBN, NNPC and 36 other agencies were sent to the parliament for approval for the first time, to the applause of the lawmakers. It then means that each expenditure will be justified, and in accordance with Section 80 (4) of the 1999 Constitution, as amended.
What the country has suffered with the agencies observing the law in the breach comes out in sharp relief with the difficulty witnessed in times past in tracking receipts and expenditures of the NNPC. This was even beyond the ken of the CBN, typified in Sanusi’s alarm that $20 billion oil revenue could not be accounted for by the agency. That foggy horizon has been widened with the House of Representatives’ ongoing investigation, which claims that the value of total crude oil sold between 2011 and 2014 stood at $123 billion, but the CRF was credited with only $42.7 billion. It has, therefore, asked the corporation to explain what happened to the balance of $81.2 billion.
Those resistant to the TSA and consolidated budgeting should appreciate the fact that they are global financial tools for public expenditure control. In the United Kingdom, it has a consolidated budgeting guidance document (2016 to 2017) for government departments. The system thus “supports the achievement of macroeconomic stability by ensuring that public expenditure is controlled in support of the government’s fiscal framework.” This in addition to providing high service delivery that offers value for money to the public.
Therefore, JAMB and NIMASA have given the government sufficient evidence to bring the errant MDAs to book. And this should be done with a sense of urgency.
