How 10 MDAs yielded only N400m to federation account in 2019

Ten of at least 11 Ministries, Departments and Agencies (MDAs) that remitted revenues to the federation account in 2019, yielded a paltry N400 million to the N2.6 billion independent revenue realised during the period, a report has revealed.

According to the 2019 annual report released by the Fiscal Responsibility Commission (FRC), the 11th agency which is the Federal Road Safety Corps (FRSC) remitted N2.2bn bringing the total remittance to N2.6bn.

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An analysis of the report indicates that only eight MDAs completed their 2019 report submission which was less than the 10 MDAs that did that in 2018.

The N2.6bn revenue remittance of 2019 was a significant decline compared to the N7.752bn remitted by 14 MDAs in 2018.

While over 97 per cent of the remittance of 2019 came from FRSC, the Federal Ministry of Labour and Productivity was next in remittance of N145m, which is less than 2% of the FRSC N22bn remittance.

The other MDAs and their remittances include the Federal Ministry of Environment with N63m, Office of the Secretary to the Federal Government with N45m, and the Federal Ministry of Education with N41m remittance.

The rest are the Office of the Auditor-General with N27m, the Federal Ministry of Health with N16m, the Court of Appeal remitted N10m, the Federal Ministry of Youth and Sports Development remitted N1.7m and the Federal Ministry of Justice remitted N544,000.

Further analysis indicates that the N544,000 remitted by the Ministry of Justice was done in the third quarter. That was the only remittance for the year as captured by the FRC report, with nothing in the other quarters.

The Federal Ministry of Youth and Urban Development made only two-quarter remittances of N1.7m (1st and 2nd); the Court of Appeal’s N10m remittance was in the first quarter.

Daily Trust reports that FRC sends requests and reminders to MDAs to submit revenue returns every quarter in line with the provisions of the Fiscal Responsibility Act (FRA), 2007.

According to the FRC annual report, data on revenue returns obtained in the preceding year revealed that the MDAs had been defaulting in the remittance of internally generated revenues to the Consolidated Revenue Fund.

The Chairman of FRC, Barr Victor Muruako, who signed the report, noted that the responses and submission rate was disappointing even though requests and reminders for submissions were mailed to the MDAs.

FRC had recently reported 122 MDAs that have failed to remit N1.2 trillion to the Consolidated Revenue Fund (CRF).

The FRA mandates government agencies to remit into the CRF, their operating surplus after every fiscal year. However, Nigerians have witnessed a disturbing trend whereby almost all government enterprises fail to comply with this financial obligation.

What unremitted funds can do

The unremitted fund, which translates to $3.1bn, is 9.2% of the 2021 budget and can fund the combined capital budget for education (N127bn), health (N132bn), works and housing (N404bn), power (N198bn) and agric (N110bn) all of which stand at N1.22tr.

But this is not the first time government agencies will be violating financial regulations. In December 2018, the Director-General, Budget Office of the Federation, Ben Akabueze, said government-owned enterprises owed about N10 trillion in unremitted operating surpluses as of August 2018.

Quoting a report from the Office of the Accountant-General of the Federation, he said the Petroleum Products Pricing Regulatory Agency (PPPRA) was the biggest culprit, with an unremitted operating surplus of over N1.3tr.

Next was the Central Bank of Nigeria (CBN) with N801.2bn and the Nigeria Ports Authority (NPA) with N192.1bn.

In August 2020, the Department of Petroleum Resources (DPR), which has the statutory responsibility of ensuring compliance to petroleum laws, regulations and guidelines, by its own admission before a joint Senate Committee, stated that only N44.5bn out of the N2.4tr it generated in 2019 was remitted to the CRF.

It stated that out of the N2.4tr generated in 2019, N88bn was removed as four per cent cost of collection out of which N5.72bn was remitted and the balance used for overheads.

Similarly, the Securities and Exchange Commission (SEC) had revealed that it generated N8.3bn in 2019 but spent N10.3bn on the salaries of about 600 workers, meaning that it ran at a deficit. The figure also implies that an average of N15.7m is spent annually on each SEC employee.

Commenting on these non remittances, the national president of the National Association of Nigerian Traders (NANTS), Barr Ken Ukaoha said: “It smacks of irresponsibility and insensitivity that a government that has asked Nigerians to endure increased taxes and tariffs in the middle of harsh economic realities occasioned by the COVID-19 and drop in oil prices, watches helplessly at these leakages.”