Daily Trust - How Reps, MDAs differ on N1.4trn unremitted funds

 

How Reps, MDAs differ on N1.4trn unremitted funds

  • Probe not to intimidate agencies – Chief whip

 

Various committees of the House of Representatives have accused some Ministries, Departments and Agencies (MDAs) of allegedly failing to remit revenues amounting to over N1.429 trillion to the federal government.

However, mixed reactions are already trailing the probe, with the leaderships of some of the agencies describing it as needless. Officials of some of the agencies and civil society groups are also quietly grumbling on the real motive behind the probe by the legislators, alleging that the move was self-serving.

The House of Representatives committees were also accusing select agencies of implementing questionable projects and providing scanty details relating to budget items. The statistical records of the infractions were obtained from the various sittings of the committees and a 2017 report of the Auditor General of the Federation.

The development is coming about four years into the implementation of the Treasury Single Account (TSA) by the federal government.

Hon. Femi Gbajabiamila, Speaker of the House of Representatives.
Hon. Femi Gbajabiamila, Speaker of the House of Representatives.

The TSA ensures that MDAs operate through a Consolidated Revenue Fund (CRF) domiciled with the Central Bank of Nigeria (CBN) to increase the transparency of revenue generation and expenditure of the federal government.

Though some of the officials summoned gave explanations in respect of the issues raised, the legislators, notwithstanding, asked for deeper probe into the issues.

Asked to comment on claims that the various probes were meant to force agencies to submission, the Chief Whip of the House of Representatives, Muhammad Tahir Monguno (APC, Borno), said what the legislators wanted was to ensure funds were freed for the 2020 budget recently signed into law by President Muhammadu Buhari.

“We must make sure that all funds not remitted by MDAs are recouped and remitted to government,” he said.

On why they went back many years in their probe, he said, “Government is continuity; it is not about when the monies were not remitted. What matters most now is that government gets money to fund the budget and provide the necessities of life, infrastructure, education, healthcare and others.”

Yusuf Isa Sani of Partnership for Legislative Competence (PLC), a non-governmental organisation, said while legislators have constitutional backing to oversight the executive and its agencies, some of their actions were questionable.

“We have cause to be worried because some heads of agencies silently accuse the legislators of extortion. They said once they give the legislators kickback, they would abandon whatever oversight or probe they were doing.

“And even when there is nothing to probe, the legislators will keep hammering provided nothing is dropped for them. I think we should have a system that will also checkmate the excesses of the legislators,” he said.

 

Different agencies different issues

Top of the agencies “indicted” is the Petroleum Products Pricing Regulatory Agency (PPPRA). The House of Representatives said it allegedly failed to remit N1.343 trillion Internally Generated Revenue (IGR) to the CRF for several years.

PPPRA was established by an Act of the National Assembly in 2003. Its functions include the payment of fuel subsidy among others and it generates revenue from granting licences to firms for the importation of petroleum products.

Under the Fiscal Responsibility Act 2007, all government agencies are expected to compulsorily remit their operating surpluses to the federation account, annually. The lower chamber of the National Assembly pointed out that non-remittance of revenues contravenes Section 162(1) of the 1999 Constitution (as amended). The Director General, Budget Office, Ben Akabueze, at a 2018 town hall meeting in Abuja, said PPPRA was the worst culprit by withholding operating surplus of over N1.34trn.

The lawmakers, therefore, urged the House Committee on Petroleum Resources (Downstream) to investigate the allegation and report back in 10 weeks. Responding, the spokesman for PPPRA, Apollo Kimchi, told Daily Trust on telephone that since inception, PPPRA has not collected up to N70bn as revenue.

“We can remit only from what we collect and I am not sure if it is up to N60bn not to talk of N1.3trn. It is a ridiculous story and it came up last year. I did a statement to say it is not true. The DG Budget, where story emanated from, was approached and there was no substance in it.

“We have details of our revenues and remittances and a copy of our external audit on remittance is with the DG Budget and even the National Assembly clerk. That 30 kobo per litre collection is our primary IGR,” Kimchi explained.

 

NIMASA

The House of Representatives went further to probe an alleged payment of $50,000 (about N18.1m) to the Nigerian Navy before escorting vessels through Nigerian waterways to their destinations. The alleged infraction involved the Nigerian Maritime Administration and Safety Agency (NIMASA).

The House, therefore, asked NIMASA to account for the three per cent freight charges collected in the last 10 years since it failed to ensure the security of Nigerian waterways. NIMASA was equally under the lawmakers’ hammer for allegedly spending over N3bn on Maritime University, among others.

The committee recommended that NIMASA’s 2020 budget be stood down until proper clarification on many line items contained in its 2019 budget is offered.

It was held that despite the N3bn allocation to the university, there are no physical structures on the site. The agency was also queried for the N300m earmarked for office cleaning and N300m for insurance coverage for floating dock.

Also, NIMASA’s Director General, Dakuku Peterside was asked to explain utilisation of N100m for outsourcing and other monies paid as allowances for official vehicles.

Responding, Peterside said the N3bn was for the smooth takeoff of the university, saying he approved N500m payment for the project in five tranches and that another N500m is yet to be approved.

 

Transport

The lawmakers also demanded explanation from the Federal Ministry of Transport on an alleged N59.8bn security and surveillance contract for the waterways, ports and harbours.

The N59.8bn contract was for the supply of surveillance and security equipment awarded by the ministry through NIMASA. They held that due process and procedure for entering into the contract worth $195.3m was not followed.

However, the Minister of Transportation, Mr Rotimi Amaechi, told one of our correspondents that the National Assembly had previously investigated the matter and gave them a clean bill of health. “You want to cause trouble between me and the National Assembly? But the National Assembly investigated this same contract before the election and gave us clean bill of health. What are they investigating again?” he asked.

Explaining the security situation on the waterways, Amaechi said the facilities were arriving and the Israelis will soon launch security on Nigerian waterways. “That security contract involves the Army, Police, Air Force, SSS and all relevant security agencies and they will be on the water. It won’t be like before when it was just the Navy,” he explained.

 

NSITF

The Nigeria Social Insurance Trust Fund (NSITF) was also alleged to have expended N2.3bn without authorisation by the board, the lawmakers claimed. It was noted that the transaction also exceeded the approving limit of the management and called for a probe into the infraction.

But officials of the agency said there was no N2.3bn allegation. It explained that ICPC was investigating the Duty Tour Allowance (DTA) of the management staff which had been responded to appropriately.

In a statement, NSITF said it was committed to transparency and accountability of all its business. It said the training was budgeted for in its 2018 and 2019 procurement plans.

“The process was advertised in national dailies, the bids were competed for, opened publicly, evaluated and awarded. The training was done in 15 states of the federation that involved over 4,000 of our staffers,” the statement said.

 

NPA

At the Nigerian Ports Authority (NPA), an unsigned N5.1bn renovation contract implementation about seven years ago caused raised eyebrows.

The House Committee on Public Accounts recently demanded that the present management which was not in the picture of how the contract was executed should present the original copies of the contractual agreement for the renovation of NPA Corporate Headquarters in Lagos awarded in 2011.

The probe was based on a query by the office of the Auditor General of the Federation on the contract which allegedly had no valid and signed contractual agreement.

But in her response before the committee, the NPA Managing Director, Hadiza Bala Usman, said the contract was awarded by the Federal Executive Council (FEC).

She added that there was a valid, signed contractual agreement. She was told to present the original copy of the agreement and not the photocopies.

 

Customs

Another of these infractions was allegedly at the Nigeria Customs Service (NCS). The management had appeared before the house committee but without the account officers.

The service was summoned earlier over improper audit of its account for the 2013 and 2014 financial years. It was alleged that N14.8bn was missing in 2013.

Speaking at the hearing, Comptroller -General of Customs (CGC), retired Col. Hameed Ali, confirmed that the account had not been audited by external auditors for years as there was no approval from the Bureau of Public Procurement (BPP) to engage their services.

“We just got this approval recently and the external auditors sent a draft copy on the 2013 financial year to us just last week. We wrote several letters to the BPP on this until we got the nod; it is not our own making,” he stated.

The committee also summoned CBN Governor Godwin Emefiele over an alleged missing N14.8bn at customs as contained in a query raised by the Auditor General for the 2013 financial year.

 

FG asked to tame impunity

The Executive Director, OJA Development Consult, Mr Jide Ojo, told Daily Trust that the culture of impunity by the MDAs needs to be broken.

Mr. Ojo, who is also a public commentator and newspaper columnist, said “we have been told that many of the revenue generating agencies have not been remitting monies collected to the federation account as expected.

“The question is, what has the government done to discourage the continuation of this unwholesome practice?” he asked.

Daily Trust Board of Economists’ recommendation

Meanwhile, the Daily Trust Board of Economists in a communiqué noted the urgent need for the federal government to effect a constitutional change by directing every revenue generating agency to limit its expenditure to only approved budgets and remit all excess revenue to the CRF.

 

Auditor General suggests the way forward

In his latest report, the Auditor General of the Federation, Mr Anthony Ayeni, made recommendations on how to tame infractions by MDAs.

A recommendation directed to the Minister of Finance, Zainab Ahmed, said she “should ensure that all MDAs are fully on the GIFMIS platform and that no payment is made without passing through the platform. The use of manual payment vouchers should be abolished.

“I further recommend that appropriate sanctions are applied to all involved in instances of payments being made without the expected supporting documents and/or approvals,” Ayeni said.

He also called for a proper strategy to improve the oversight of revenue generating agencies.

“Timely reconciliation of all revenues accruing to the Consolidated Revenue Fund should be done immediately,” he added.

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How Reps, MDAs differ on N1.4trn unremitted funds

  • Probe not to intimidate agencies – Chief whip

 

Various committees of the House of Representatives have accused some Ministries, Departments and Agencies (MDAs) of allegedly failing to remit revenues amounting to over N1.429 trillion to the federal government.

However, mixed reactions are already trailing the probe, with the leaderships of some of the agencies describing it as needless. Officials of some of the agencies and civil society groups are also quietly grumbling on the real motive behind the probe by the legislators, alleging that the move was self-serving.

The House of Representatives committees were also accusing select agencies of implementing questionable projects and providing scanty details relating to budget items. The statistical records of the infractions were obtained from the various sittings of the committees and a 2017 report of the Auditor General of the Federation.

The development is coming about four years into the implementation of the Treasury Single Account (TSA) by the federal government.

Hon. Femi Gbajabiamila, Speaker of the House of Representatives.
Hon. Femi Gbajabiamila, Speaker of the House of Representatives.

The TSA ensures that MDAs operate through a Consolidated Revenue Fund (CRF) domiciled with the Central Bank of Nigeria (CBN) to increase the transparency of revenue generation and expenditure of the federal government.

Though some of the officials summoned gave explanations in respect of the issues raised, the legislators, notwithstanding, asked for deeper probe into the issues.

Asked to comment on claims that the various probes were meant to force agencies to submission, the Chief Whip of the House of Representatives, Muhammad Tahir Monguno (APC, Borno), said what the legislators wanted was to ensure funds were freed for the 2020 budget recently signed into law by President Muhammadu Buhari.

“We must make sure that all funds not remitted by MDAs are recouped and remitted to government,” he said.

On why they went back many years in their probe, he said, “Government is continuity; it is not about when the monies were not remitted. What matters most now is that government gets money to fund the budget and provide the necessities of life, infrastructure, education, healthcare and others.”

Yusuf Isa Sani of Partnership for Legislative Competence (PLC), a non-governmental organisation, said while legislators have constitutional backing to oversight the executive and its agencies, some of their actions were questionable.

“We have cause to be worried because some heads of agencies silently accuse the legislators of extortion. They said once they give the legislators kickback, they would abandon whatever oversight or probe they were doing.

“And even when there is nothing to probe, the legislators will keep hammering provided nothing is dropped for them. I think we should have a system that will also checkmate the excesses of the legislators,” he said.

 

Different agencies different issues

Top of the agencies “indicted” is the Petroleum Products Pricing Regulatory Agency (PPPRA). The House of Representatives said it allegedly failed to remit N1.343 trillion Internally Generated Revenue (IGR) to the CRF for several years.

PPPRA was established by an Act of the National Assembly in 2003. Its functions include the payment of fuel subsidy among others and it generates revenue from granting licences to firms for the importation of petroleum products.

Under the Fiscal Responsibility Act 2007, all government agencies are expected to compulsorily remit their operating surpluses to the federation account, annually. The lower chamber of the National Assembly pointed out that non-remittance of revenues contravenes Section 162(1) of the 1999 Constitution (as amended). The Director General, Budget Office, Ben Akabueze, at a 2018 town hall meeting in Abuja, said PPPRA was the worst culprit by withholding operating surplus of over N1.34trn.

The lawmakers, therefore, urged the House Committee on Petroleum Resources (Downstream) to investigate the allegation and report back in 10 weeks. Responding, the spokesman for PPPRA, Apollo Kimchi, told Daily Trust on telephone that since inception, PPPRA has not collected up to N70bn as revenue.

“We can remit only from what we collect and I am not sure if it is up to N60bn not to talk of N1.3trn. It is a ridiculous story and it came up last year. I did a statement to say it is not true. The DG Budget, where story emanated from, was approached and there was no substance in it.

“We have details of our revenues and remittances and a copy of our external audit on remittance is with the DG Budget and even the National Assembly clerk. That 30 kobo per litre collection is our primary IGR,” Kimchi explained.

 

NIMASA

The House of Representatives went further to probe an alleged payment of $50,000 (about N18.1m) to the Nigerian Navy before escorting vessels through Nigerian waterways to their destinations. The alleged infraction involved the Nigerian Maritime Administration and Safety Agency (NIMASA).

The House, therefore, asked NIMASA to account for the three per cent freight charges collected in the last 10 years since it failed to ensure the security of Nigerian waterways. NIMASA was equally under the lawmakers’ hammer for allegedly spending over N3bn on Maritime University, among others.

The committee recommended that NIMASA’s 2020 budget be stood down until proper clarification on many line items contained in its 2019 budget is offered.

It was held that despite the N3bn allocation to the university, there are no physical structures on the site. The agency was also queried for the N300m earmarked for office cleaning and N300m for insurance coverage for floating dock.

Also, NIMASA’s Director General, Dakuku Peterside was asked to explain utilisation of N100m for outsourcing and other monies paid as allowances for official vehicles.

Responding, Peterside said the N3bn was for the smooth takeoff of the university, saying he approved N500m payment for the project in five tranches and that another N500m is yet to be approved.

 

Transport

The lawmakers also demanded explanation from the Federal Ministry of Transport on an alleged N59.8bn security and surveillance contract for the waterways, ports and harbours.

The N59.8bn contract was for the supply of surveillance and security equipment awarded by the ministry through NIMASA. They held that due process and procedure for entering into the contract worth $195.3m was not followed.

However, the Minister of Transportation, Mr Rotimi Amaechi, told one of our correspondents that the National Assembly had previously investigated the matter and gave them a clean bill of health. “You want to cause trouble between me and the National Assembly? But the National Assembly investigated this same contract before the election and gave us clean bill of health. What are they investigating again?” he asked.

Explaining the security situation on the waterways, Amaechi said the facilities were arriving and the Israelis will soon launch security on Nigerian waterways. “That security contract involves the Army, Police, Air Force, SSS and all relevant security agencies and they will be on the water. It won’t be like before when it was just the Navy,” he explained.

 

NSITF

The Nigeria Social Insurance Trust Fund (NSITF) was also alleged to have expended N2.3bn without authorisation by the board, the lawmakers claimed. It was noted that the transaction also exceeded the approving limit of the management and called for a probe into the infraction.

But officials of the agency said there was no N2.3bn allegation. It explained that ICPC was investigating the Duty Tour Allowance (DTA) of the management staff which had been responded to appropriately.

In a statement, NSITF said it was committed to transparency and accountability of all its business. It said the training was budgeted for in its 2018 and 2019 procurement plans.

“The process was advertised in national dailies, the bids were competed for, opened publicly, evaluated and awarded. The training was done in 15 states of the federation that involved over 4,000 of our staffers,” the statement said.

 

NPA

At the Nigerian Ports Authority (NPA), an unsigned N5.1bn renovation contract implementation about seven years ago caused raised eyebrows.

The House Committee on Public Accounts recently demanded that the present management which was not in the picture of how the contract was executed should present the original copies of the contractual agreement for the renovation of NPA Corporate Headquarters in Lagos awarded in 2011.

The probe was based on a query by the office of the Auditor General of the Federation on the contract which allegedly had no valid and signed contractual agreement.

But in her response before the committee, the NPA Managing Director, Hadiza Bala Usman, said the contract was awarded by the Federal Executive Council (FEC).

She added that there was a valid, signed contractual agreement. She was told to present the original copy of the agreement and not the photocopies.

 

Customs

Another of these infractions was allegedly at the Nigeria Customs Service (NCS). The management had appeared before the house committee but without the account officers.

The service was summoned earlier over improper audit of its account for the 2013 and 2014 financial years. It was alleged that N14.8bn was missing in 2013.

Speaking at the hearing, Comptroller -General of Customs (CGC), retired Col. Hameed Ali, confirmed that the account had not been audited by external auditors for years as there was no approval from the Bureau of Public Procurement (BPP) to engage their services.

“We just got this approval recently and the external auditors sent a draft copy on the 2013 financial year to us just last week. We wrote several letters to the BPP on this until we got the nod; it is not our own making,” he stated.

The committee also summoned CBN Governor Godwin Emefiele over an alleged missing N14.8bn at customs as contained in a query raised by the Auditor General for the 2013 financial year.

 

FG asked to tame impunity

The Executive Director, OJA Development Consult, Mr Jide Ojo, told Daily Trust that the culture of impunity by the MDAs needs to be broken.

Mr. Ojo, who is also a public commentator and newspaper columnist, said “we have been told that many of the revenue generating agencies have not been remitting monies collected to the federation account as expected.

“The question is, what has the government done to discourage the continuation of this unwholesome practice?” he asked.

Daily Trust Board of Economists’ recommendation

Meanwhile, the Daily Trust Board of Economists in a communiqué noted the urgent need for the federal government to effect a constitutional change by directing every revenue generating agency to limit its expenditure to only approved budgets and remit all excess revenue to the CRF.

 

Auditor General suggests the way forward

In his latest report, the Auditor General of the Federation, Mr Anthony Ayeni, made recommendations on how to tame infractions by MDAs.

A recommendation directed to the Minister of Finance, Zainab Ahmed, said she “should ensure that all MDAs are fully on the GIFMIS platform and that no payment is made without passing through the platform. The use of manual payment vouchers should be abolished.

“I further recommend that appropriate sanctions are applied to all involved in instances of payments being made without the expected supporting documents and/or approvals,” Ayeni said.

He also called for a proper strategy to improve the oversight of revenue generating agencies.

“Timely reconciliation of all revenues accruing to the Consolidated Revenue Fund should be done immediately,” he added.

texem
More Stories