Senate committee exposes how MDAs fail to remit over N3 trillion into FG’s account

*Knocks Accountant General’s office for deficiency in collection of operational surpluses

*Minister lauds probes

Tunde Opalana, Abuja

As the Senate Committee on Finance continues its investigations into revenue remittances by over 700 Ministries, Departments and Agencies (MDAs) of the Federal Government, the chairman of the committee, Senator Solomon Adeola (APC, Lagos West) has revealed that over N3 trillion of generated revenue of the government may be trapped with MDAs or already spent on frivolous expenditures contrary to the 1999 Constitution of the Federal Republic and the Fiscal Responsibility Act(FRA),2007.

This is coming at a time when the country is having deficit budget of N5.2 trillion.

The committee chairman made the disclosure over the weekend when the Minister of Finance, Budget and National Planning, Hajia Zainab Ahmed alongside the Director General of Budget Office, Mr. Ben Akabueze and the Auditor General of the Federation, Mr. Idris Ahmed with other heads of agencies appeared before the committee on the ongoing investigation into revenue remittances by MDAs between 2014-2020 and payment of 1% Stamp Duty on all contract awards by the MDAs within the same period.

Senator Adeola said he invited the minister, the DG, Budget Office and the Accountant General of the Federation to get their full buy-in and brief them on the revelations unearthed by the over four weeks long investigations with many agencies committing all manner of illegalities relating to the expenditure of government funds that should rightly be paid into the Consolidated Revenue Fund, CRF .

Adeola added that most of the agencies abuse the concept of operating surpluses to shortchange government as well as relying on ministerial circulars over and above the Constitution and FRA,2007 as passed by the National Assembly.

“Honourable Minister in view of the huge budget deficits accompanying our yearly budgets and the resort to huge borrowing to finance these deficits, the committee decided to probe into the revenue remittances by agencies of government as the government cannot continue to borrow yearly while the revenue from agencies that the government is financing with the borrowings are spent contrary to the laws of the land,” he stated.

The Chairman while speaking added that the Office of Accountant General of Federation has confirmed development to the committee lamenting that the Office of Accountant General of the Federation is not firm in collecting the Operational Surplus hanging in those agencies.

“We discovered that 10 Government Owned Enterprises (GOEs) which we have identified in the beginning of trying to bring these Government Owned Enterprises have subsequently increased to about 50 to 60 GOEs.

“The reconciliation done so far by the Office of the Accountant General of the Federation is in excess of over a trillion naira going to like N2 trillion thereabout and these monies are still hanging in the hand of these agencies and we have asked office of Accountant General that what are they doing to get the money into the government coffer and we discovered that they are given them a payment notice without necessarily following up this process.

“We have noticed that the so called 80 percent of operational surplus we have reference to , many of these agencies proved frivolous expenditure and they have taken advantage of the current system and refuse to remit this amount as at when due.

“We try to audit the account of these agencies year in year out for the past five years and some of the revelation are scaring.

How do we explain that an agency of government that has provision in the budget for Capital, Overhead and Personnel in their audited account, they have gross revenue of N500 million and they are asking for N200 million.

“There is no gainsaying the fact that if these revenues are paid to the CRF for proper appropriation by the Parliament during budget considerations, we are going to reduce dramatically the size of our deficit and hopefully minimize our borrowing.

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,” he stated.

Senator Adeola further revealed that the investigation has also led to the willing exit of some agencies, notably among them NAFDAC, NIGCOMSAT, NOTAP and NERC, from the budget of the government while relying on their generated revenue to fund aspects of their operations adding that this will reduce their dependence on federation budget and assist in reducing budget deficits.

In her contribution, Hajia Ahmed commended the committee for the ongoing probe of revenue remittances as she acknowledged that in recent times there has be noticeable increase in revenue from agencies directed to pay in revenue to the CRF as required by the law adding that the executive arms of government are also scrutinizing the application of the template of calculating and deducting operating surpluses by agencies of government to ensure that the right amount are paid to the government.

Mr. Akabueze, the DG, Budget Office clarified that the issue of operating surpluses does not apply to any government agencies that are fully funded by the government as all revenue generated by such agencies must be paid in full into the CRF adding that it is illegal to spend a dime of such money without appropriation by the National Assembly.

According to Chief Kayode Odunaro, Media Adviser to Senator Adeola, the Committee in furtherance of its investigations on agencies already scheduled to appear before it this week, thereafter set up a committee comprising of representatives from the Offices of the Minister of Finance, the Budget Office, Accountant General of the Federation, the Auditor General of the Federation and Fiscal Responsibility Commission to reconciled the accounts of some agencies running into billions of naira to determine how much is due to the CRF following contradictions in their submissions.