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The Senate Public Accounts Committee recently disclosed that about 588 Ministries, Departments and Agencies (MDAs) could not account for N969 billion budgetary allocations in 2019 financial year. Most of the unaccounted funds came under the subhead of ‘intangible assets.’ The vice chairman of the committee, Sen. Ibrahim Hassan Hadejia, said the details of the agencies involved are contained in the Auditor-General’s report.
Some of the agencies mentioned in the report included the State House, Abuja, Federal Civil Service Commission, Office of the National Security Adviser, Bureau of Public Enterprises, Bureau of Public Procurement, National Orientation Agency, Federal Fire Service, Nigeria Security and Civil Defence, Federal Ministry of Information, News Agency of Nigeria and others.
The revelation has, once again, exposed the rising corruption in the MDAs. Intangible assets are those assets that are not physical in nature but still hold substantial financial value. They include computer softwares, licences, copyrights, trademarks, import quotas, among other items for which funds were approved. The failure of the MDAs to account for billions of naira questions the government’s avowed war against financial graft. It is an indictment on the use of the Treasury Single Account (TSA). The rot in the MDAs must be investigated and those involved brought to justice.
The startling discovery by the Public Accounts Committee followed the review of the 2019 Auditor-General of the Federation (AuGF) report on the MDAs. Specifically, details of the N969billion of the intangible assets fall under notes 36 and 36A, and in line with the Federal Government’s Consolidated Financial Statement. The action of the MDAs contravenes the provision of International Public Sector Accounting Standard (IPSAS) 31. The ‘guilty’ MDAs cut across most federal civil service agencies, commissions, tertiary institutions, parastatals and paramilitary agencies.
It is disturbing that many government agencies have become cesspools of monumental fraud. The often reported financial abuses clearly negate accountability and transparency. Last year, the Independent Corrupt Practices and Other Offences Commission (ICPC) bemoaned the alarming corruption in many MDAs. The Chairman of the anti-graft agency, Prof. Bolaji Owasanoye, noted that N13.59 trillion was ‘padded’ by some of MDAs in the 2021 budget. Also, project duplication worth N100 billion was allegedly inserted into the N17trillion 2022 budget. This included N49.9billion that was flagged off as salaries for ‘ghost’ or non-existent workers between January and June that year.
Though the names of the MDAs involved in the fraud were not made public, they were reported to have been forwarded to Senate Committee on Finance for necessary sanctions. But nothing was done. That perhaps explains why such abuses have become rife in the MDAs. Also in its 2017 audited financial report of the MDAs, the Office of the AuGF revealed that 265 MDAs did not account for over N300billion. Similarly, the 2016 AuGF report uncovered N450billion unremitted funds between 2010 and 2015.
It has been revealed that there is a breach of accounting procedures, including the guidelines set out for the implementation of the Treasury Single Account (TSA). It is unfortunate that despite the TSA, the financial excesses of MDAs have not been curbed. This is one of the reasons why the revenues of the agencies are often shrouded in secrecy. Last year, President Muhammadu Buhari directed the MDAs to publish daily treasury summary statement of financial inflows and outflows. But the directive was not observed.
By the provisions of the Financial Regulation 3210(v), Heads of government agencies and commissions are required to submit details of both the audited accounts and management reports to the AuGF not later than May 31 of the following year. Even though the relevant rules of the National Assembly stipulate that defaulting agencies should be sanctioned and stiff penalties imposed on the chief accounting officers for violating the rule, none of the the chief accountant officers has been punished on account of not observing the regulations. This has made it possible for the agencies and their heads to continue to run the affairs of their respective agencies with impunity.
Last year, the AuGF, Adolphus Aghughu, while submitting the 2019 Audit Report of the MDAs, noted that his office uncovered massive unverified balances in the consolidated financial statements totaling N4.97trillion. He stated that queries issued to the affected MDAs were not honoured by their heads. Also in 2021, seven heads of MDAs refused to appear before the Senate Public Accounts Committee to clarify votes allocated to their agencies.
Unless the financial malfeasance is tackled head-on and the culprits severely punished, fraud in the MDAs will continue to fester. Let the NASS deal with MDAs that fail to meet all accountability requirements stipulated by the law, and also refuse to approve budgets for any MDA that defaults in its statutory compliance duties. To ensure transparency in government spending, the TSA portal should always be active. The frequent reports of the shutdown of the portal may have increased the level of corruption in the MDAs.
