Business

MDAs: Maximum sanctions as remedy for revenue leakage

With over N3 trillion said to be unaccounted for by over 60 MDAs at the on-going MTEF hearing at the National Assembly, its high time sanctions were meted to CEOs that underremit revenue into CRF, ABDULWAHAB ISA reports

Government isn’t on the same page with over 900 ministries, department and agencies ( MDAs) that draw funds from the treasury. Its body language and vocal expression imply a breach of financial regulation and extant rules by the MDAs with reference to the budget, expenditure and revenue management. The lamentation coming from the on-going appearance of MDAs at the National Assembly, outcome of investigations by EFCC and ICPC on frauds across MDAs underscore the quantum of Federal Government’s revenue being siphoned across MDAs. Diversion of government’s revenue by MDAs personnel into personal purses is taking a toll on government’s budget implementation.

Shortchanging FG on revenue

Majority of revenue generating agencies pocket large chunks of what they generate and remit pittance to the Consolidated Revenue Fund accounts. This act denies the Federal Government the much needed revenue to implement projects captured in the budget. The House of Representatives Committee on Finance pointed out massive revenue under cutting by MDAs through under remittance of their revenue and extra-budgetary spending. Chairman of the committee, James Faleke, had, in a remark recently at the end of the interactive session on the 2022-2024 MTEF/FSP with various revenue-generating agencies, lamented the voluminous revenue leaks in MDAs. Faleke said in the course of interaction, the committee observed that the agencies leveraged their establishment Acts to spend their internally generated revenues (IGR), thereby denying government of the needed income.

“The committee established that some of these Acts are self-serving and against national interest. The need to expeditiously amend such Acts cannot, therefore, be overemphasised. “The committee is also worried over the agencies’ flagrant disregard for extant laws particularly the Constitution of the Federal Republic of Nigeria 1999 (as amended). “The action, as it were, is putting a major strain on the resources, which ordinarily should be available for government to pursue its development objectives. “Agencies of government embark on extra-budgetary spending contrary to the Constitution of the Federal Republic of Nigeria 1999 (as amended) and the Fiscal Responsibility Act.

“Some agencies that are yet to appear before the committee will be reinvited to appear on resumption of the House of Representatives, failing which our recommendations may include the removal of their capital and overhead from the 2022 budget,” the lawmaker said. The chairman said the interactive session, aimed at blocking financial leakages and instilling fiscal discipline, had been revealing and rewarding. Ditto for Senate.

The upper chamber alarted Nigerians that MDAs did not remit over N3 trillion to the Consolidated Revenue Fund (CRF) of the Federal Government between 2014 and 2020. Chairman, Senate Committee on Finance, Senator Solomon Adeola (APC – Lagos), made the claim recently via a statement. The lawmaker made the stunning disclosure in the aftermath of the Senate’s investigation on the failure to remit one per cent stamp duty by MDAS which saw the Minister of Finance, Zainab Ahmed, and the DG of Budget Office, Ben Akabueze, present themselves to the committee. According to the Senate Committee, investigations revealed that MDAs were operating under illegalities in relation to funds remittance to the Consolidated Revenue Fund, citing that revenue meant to be remitted may have been wasted. “The committee decided to probe the revenue remittances by agencies of government.

Government cannot continue to borrow yearly while the revenue from agencies that government is financing with the borrowings are spent contrary to the laws of the land. “From submissions already made and calculations from the Fiscal Responsibility Commission, about 60 Government-Owned Enterprises (GOEs) may have about N3 trillion of government revenue still unremitted in their coffers, or already spent on frivolous expenditure contrary to the Constitution and FRA 2007. “We cannot continue to run government business as we used to do in this time when there are huge demands for government to fund needed infrastructure and other socio-economic programmes,” Senator Adeola said.

Continuing, he recalled Ahmed’s position, saying: “The finance minister told the Senate committee that the Federal Government was considering an approach to calculate and deduct the operating charges from sources before remitting to MDA’s.”

MDAs on FG’s radar

Government acknowledged the rip-off. Ahmed had said the Federal Government took it up with the culprit agencies. During her contribution at the Senate, she confirmed that in recent times a good number of agencies had been directed to pay back revenues collected on behalf of the Federal Government as required by the law. On his part, the DG, Budget Office, Akabueze, clarified that the issue of operating surplus does not apply to any government agencies that are fully funded by government, stressing that all revenue generated by such agencies must be paid in full into the CRF as it is illegal to spend out of such money without appropriation by the National Assembly.

Maximum sanctions as way out

In absence of maximum sanctions as a deterrent to checkmate CEOs of revenue agencies, under remittance of revenue by the MDAs shall remain a continuous practice. The Fiscal Responsibility Commission (FRC) is statutorily established by Act of 2007 to regulate activities of MDAs in fiscal space. Regrettably, the Commission is bereft of power to enforce sanctions on erring MDAs that violate revenue remittance into consolidated revenue fund.

“Undertake fiscal and financial studies, analysis and diagnosis and disseminate the result to the general public. Enforce the submission of periodic returns on revenue performance showing estimates, actual collection and remittances to the Consolidated Revenue Fund of the Federal Government by corporations and agencies accompanied by accurate documentary evidence of collections and remittances.” It will in addition, “ensure that all profits or dividend payments due to the federal government from any privatized entity in which the federal government is a shareholder are duly remitted into the Consolidated Revenue Fund; attend and monitor monthly monitoring meeting of all revenue collectors in collaboration with the office of the Accountant General of the Federation.

“The amendment will enable the commission to monitor the operation of the Excess Crude Account and the various Funds created under the Nigerian Sovereign Investment Authority (Establishment, Etc.) Act, 2011.’’ Amongst other provisions, the amendment bill provides that the commission shall be independent in the performance of its functions.

The provisions of Public Officers Protection Act shall apply to its members and staff in the discharge of their functions. The appointment of the Secretary of the Commission, as head of its administration, shall be subject to Senate confirmation. Removal of a member of the Commission by the President shall be supported by a simple majority vote of members of the Senate amongst others. On remittance of Operating Surplus, the bill stipulates that,Corporations and agencies under the remit of the FRA shall remit 80 per cent of their operating surplus to the Consolidated Revenue Fund of the Federal Government. The calculation of this surplus shall be in accordance with the template issued by the Commission. The following offences and accompanying sanctions have been provided for in the amendment bill.

Willful (directly or indirectly) hindrance or obstruction of the Commission or its agent from performance of functions attracts a term of not less than three months imprisonment or a fine not less than N500,000.00 or both fine upon conviction.

Provision of false information (including in documents) response to a request or in the performance of a function imposed by the Act attracts a term of not less than six months imprisonment or fine not less than N1,000,000.00 or both fine upon conviction. Misleading and partial (instead of full) disclosure of information regarding functions imposed by the Act attracts a term of not less than three months imprisonment or fine not less than N500,000.00 or both upon conviction.

“Refusal or failure to give information in the performance of a function imposed by the Act attracts a term of not less than one year imprisonment or a fine of not less than N1 million or both upon conviction.’’ The amendment bill provides that a Federal High Court, whether under a criminal or civil action, is empowered to recover all benefits of related corrupt enrichment; and upon conviction, the offender will also forfeit all ill-acquired funds to the Consolidated Revenue Fund (CRF).

Last line

To curb incidences of revenue diversion and under remittances of funds by MDAs into CRF, a sanction for erring CEOs as a deterrent needs to be created even as the on-going amendment of FRC Act by members of the National Assembly remains a right step.

 

TRY IT TONIGHT!!! ---

 

Abuja Civil Servant reveals (FREE) secret Fruits that Increased his Manh0d size, gives Stronger Erections and ends Premature Erection in 7days...

   

CLICK HERE FOR FULL DETAILS.

 

%d bloggers like this:
Fake Richard Mille Replica Watches, www.richardmille.to The ceramic upper and lower cases are imported from Taiwan and are processed by ATPT ceramics to form Y-TZP ceramics. After high-tech anti-fingerprint technology, they present a delicate and soft sub-black material. This color quality has remained unchanged for a hundred years. The color and luster are more detailed to achieve the ceramic tone visual pattern electroplating upper and lower shells that are infinitely close to the original products, with anti-reflective coating sapphire glass! The tape uses a soft and delicate Malaysian imported top rubber strap, and the movement is equipped with an imported Seiko NH movement. The buckle of this version is made according to the original size and thinness, making it feel more comfortable and intimate, the highest version on the market Richard Mille Replica