WITH the drastic shortfall in government’s projected revenue, the Minister of Finance, Mrs. Kemi Adeosun, last week accused revenue generating agencies of high level corruption and under-declaration of the revenue they generate.
The Minister’s claim was one of the highlights of the visit of members of the Senate Committee on Finance to her office. She took particular exception to one of the government’s highest revenue spinning agencies, the Nigerian Customs Service (NCS), which she described as having “cohesive crooks hard to break “.
Her umbrage against the Customs came in her defensive response to the Finance Committee’s charge that her ministry had been cavalier in reining in some corrupt officials of the agency who have been stifling government revenue. Reports from the Ministry of Finance show that NCS has generated less than N400 billion this year. This is far less than the revenue expected from the agency, as our revenue generating agencies have, for a long time, been a cesspool of corruption, in spite of measures by the present administration to clean up their Augean stables.
The way some of the agencies are frustrating efforts to meet projected revenue for public expenditures is not new. They always appear a step ahead of the strategies designed by the government to check them.
Government needs to do much more than it is doing at present to plug the loopholes in the operations of these agencies. They need to be stopped from circumventing laid down procedures for collection and remittance of revenue into government’s coffers.
While we welcome the ongoing auditing of the 31 agencies mentioned by the Finance Minister, as well as the planned probe into the activities of the Nigeria Customs Service, a template for the operations of these organisations, including their allowable expenses and expected remittances, has become necessary. The Office of the Accountant-General and the Fiscal Responsibility Commission should help to work this out for the NCS and other revenue generating agencies.
It is cheering that the Senate Committee on Customs and Excise chaired by Sen. Hope Uzodinma says it has begun investigation into the activities of the NCS, and will after that, beam its searchlight on the Nigerian Ports Authority (NPA), which is another plum revenue generating agency.
The step taken by the Senate Committee on Customs and Excise is commendable. It has given the Customs two days to provide records of its accounts in the last three years. These include records of waivers and details of how it has handled seized items like cigarettes and alcohol, as well as records of auctioned overtime and seized cargoes. It also directed the Comptroller-General of Customs, Col. Hameed Ali (retd), to submit the records of all waivers granted in the last three years, the value of the waivers, and other revenue accruals.
In this period of recession, government must plug all loopholes and stop underhand practices by revenue generating agencies. It should design a robust framework to guard against shortchanges in revenue remittances. To achieve this, the operations of these agencies need to be modernized and computerized in line with global standards. This will help to curb corruption and ensure accountability as well as transparency.
We urge the leadership of the Customs to cooperate with the Senate Committee on this investigation and provide it with all the records that it requires. It is important that the nation plugs all the leakages that make laid down guidelines for remittances of revenue easy to circumvent.
This has become expedient because with the crash in the price of the nation’s main revenue earner, crude oil, in the international market, the country cannot afford to allow corruption to thrive in its revenue generating agencies.
These agencies should not be allowed to continue to rob government of the revenue needed to fund the budget as well as pay salaries and pensions. Government’s records show that it spent N2 trillion on salaries and pensions this year and N1.4 trillion on debt servicing.
All of these create a big challenge for the 2017 fiscal estimates, even though the presidency insists that the budget is secure. Government has proposed a N6.866 trillion budget for next year. But, if it is to realise the fiscal estimates, it must tighten all loose ends in revenue generation.