The Fiscal Responsibility Commission (FRC) recently recommended the expansion of the list of Federal Government’s Ministries, Departments and Agencies (MDAs) that are scheduled to pay operating surplus to the Consolidated Revenue Fund. Though the Ministry of Finance is yet to give approval for the expansion of the MDAs’ list, we think that this is a good plan that will provide insights into the amount of revenue each Ministry, Department and Agency generates and how much they should remit to government treasury in line with the FRC Act 2007.
According to the Acting Chairman of FRC, Mr. Victor Murako, it has become necessary to expand the list of the MDAs and bring them under one safety net. The operating surplus is made up of revenues accruing to government agencies above what they are approved to spend at the beginning of the budget year.
The FRC Act requires listed agencies to pay 80 percent of their operating surpluses into the Consolidated Revenue Fund according to Section 162(1) of the Constitution. As at the last count, there are a total of 122 MDAs that are mandated to pay their operating surpluses into the Federation Account. The initial number was 30.
The addition of 92 agencies by the Ministry of Finance was part of government’s efforts to shore up its revenues. Those on the list included the National Drug Law Enforcement Agency (NDLEA), the Nigerian Investment Promotion Commission (NIPC), the Nigerian Railway Corporation (NRC), the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the Federal Radio Corporation of Nigeria (FRCN).
There is no doubt that there are many more agencies that are not yet within the safety net. Perhaps more important is the revelation by FRC that after their expenditures, many of the MDAs regard unspent revenue as windfall to be shared among the department heads, thereby causing corruption and underdeclaration of the revenue they generated. Government needs more revenues to address infrastructure deficits and ensure the welfare and security of the people.
Besides, there is need to audit the agencies and ensure accountability in their operations. There should be sufficient control and monitoring of all revenue yielding agencies. It is high time the loose ends at these agencies were tightened and ensure that all revenues are remitted to the Treasury Single Account (TSA).
The present paucity of revenues to fund the budget will be substantially checked with the expansion of the list of MDAs that will pay operating surplus to the Federation Account. It is not in doubt that some MDAs are frustrating government’s efforts to meet projected revenue for public expenditure.
Expanding the list and monitoring them closely will plug the loopholes in their operations. In doing this, government should review the template for the operations of these organisations, including their stipulated expenditure and what they should remit to the Consolidated Revenue Fund.The Office of the Accountant General of the Federation, the Auditor-General of the Federation and the FRC should help work this out.
It has become expedient to tighten the loose ends at these agencies. They should no longer be allowed to deprive government of the revenue to fund budgets, service debts, and pay salaries of workers and pensions of retirees.
It is not tidy that some of the MDAs are involved in malfeasance and under-remittance of revenue to the Consolidated Revenue Fund.
There is need for strict compliance and enforcement of laid down rules by all government corporations, commissions, authorities and agencies.