THE revelation by a Federal Government audit report that 33 revenue generating agencies failed to remit N450 billion to the Federation Account is a clear indication of lack of accountability and transparency in the indicted agencies. It is troubling that such financial malfeasance has been going on for a long time, according to the audit report that uncovered the racket.
The amount represents operating surpluses that were not returned by the agencies from 2010 to 2015. Minister of Finance, Mrs. Kemi Adeosun, who announced the discovery at a news conference in Abuja last week, said the unremitted revenue was detected following an audit conducted in compliance with the Fiscal Responsibility Act 2007.
Consequently, the Minister said a recovery committee headed by the Accountant General of the Federation has been set up to recover the money from the agencies. However, she said that some of the agencies had started returning various sums. The Nigeria Shippers Council, one of the agencies involved, has reportedly returned N640 million to the Federation Account.
The audit revealed many instances of non-remittance and under-remittance of operating surpluses. Some of the indicted agencies were also said to be operating without approved budgets. According to the Finance Minister, most of the agencies overstated their budgets, spent above their budgeted funds and failed to reconcile the differences.
Another startling discovery of the audit was the failure of the agencies to submit audited financial statements and payroll costs. There were also instances of over-payment of staff salaries and abuses of personnel grants. The Minister also revealed that there were cases of unapproved monetization of medical benefits and the failure of some agencies to convert to the government approved International Public Sector Accounting Standards (IPSAS). IPSAS are templates for budgeting processes approved by government for both the private and public sectors. This is to ensure accountability and transparency. Most of the agencies affected are money-spinning agencies. They include the Nigerian Communications Commission (NCC), Nigerian Ports Authority (NPA) and Corporate Affairs Commission (CAC).
Others are the Nigerian Maritime Administration and Safety Agency (NIMASA); Nigeria Export-Import Bank (NEXIM Bank); Federal Airports Authority of Nigeria (FAAN) and National Open University of Nigeria (NOUN). Also, affected are the Nigerian Railway Corporation; the West African Examination Council (WAEC); Joint Admissions and Matriculation Board (JAMB), and the National Hospital Abuja.
We welcome the audit report and urge that the investigation be thoroughly done and the findings made public. Beyond compelling the agencies to make the refunds, heavy sanctions should be slammed on them to deter such actions in future.
It is sad that this kind of corruption is going on in some revenue-yielding agencies. Many of the agencies routinely shortchange government, while the officials feather their own nests at the expense of the country and its citizens. Good enough, the Economic and Financial Crimes Commission (EFCC) has been called in to investigate the agencies involved in this untoward activity. This is important because the necessary lessons can only be learnt if the managers of the indicted agencies are prosecuted and sanctioned.
Asking the defaulting agencies to come up with their repayment proposals is not far-reaching enough. It amounts to a slap on the wrist. Government should also look into the Treasury Single Account (TSA) details of the defaulting organisations to know how much money they actually have. It may be discovered that some of the surpluses in question are actually in their accounts. It is necessary to do this to ensure that fiscal discipline is instituted in all government agencies. It is also baffling that some of these agencies operate without approved budgets. This is one of the easiest ways to entrench corruption in the Ministries, Departments and Agencies (MDAS) of government.
We urge the National Assembly to swiftly enact laws that can check these abuses as well as prescribe punishment for the erring agencies and their officials. It is gross fiscal indiscipline for an agency of government to operate without a budget. That means that such agencies have been handed a blank cheque to do whatever they deem fit with public funds. That is an open invitation to financial recklessness and corruption. Henceforth, government should ensure that all revenue agencies submit estimates of revenues and expenses for, at least, the next three financial years. They should also submit their annual budgets (which must be IPSAS-compliant) and projected operating surpluses.