TSA: Shock greets FG’s failure to audit remittances

No Comments » August 20th, 2017 posted by // Categories: Nigeriawatch


TSA: Shock greets FG’s failure to audit remittances

By Omodele Adigun and Isaac Anumihe

Despite the loud ovation that greeted its debut, the Treasury Single Account (TSA) Initiative of the Federal Government may have failed to live up to its billing as funds from the Ministries, Departments and Agencies (MDAs) are still not being remitted as expected.

Apart from this, the Federal Government has disclosed that it has not even audited remittances made to the TSA with the Central Bank of Nigeria (CBN) two years after it commenced.

The implication of this is that the government does not even know how much it has generated so far, leaving much room for speculations on how much is in that account.

Recall that it was reported last month end that more than N7 trillion has been remitted by banks to the TSA in compliance with the policy.

“The figure,  as at March, showed that the TSA had been able to consolidate all inflows from government agencies using a single account-Consolidated Revenue Account (CRA), at the Central Bank of Nigeria (CBN)”, the report stated.

But the Auditor General of the Federation, Anthony Ayene, shocked the nation last week at an interactive session with the House of Representatives’ Ad hoc Committee set up to ascertain the status of the TSA, that his office was yet to audit the scheme.

“We are yet to do an audit of the TSA directly. What we have been doing is audit of the Consolidated Revenue Account of the Federation, which is done every 12 months.

“When I came in and discovered that, I discussed with my directors that we should be able to do an audit of TSA for transparency and accountability. So, about three weeks ago, I asked the performance team to carry out a performance audit of TSA,” he said.

Condemning this, the national co-ordinator of Centre for Social Justice (CSJ) and an economy analyst,  Mr Eze Onyekpere, wondered why the TSA has not been audited for two years now when the audit law says that there should be a yearly audit and account keeping which should be passed to the National Assembly. He saw this as an infringement and violation of the law.

“It is not a good one for an administration that made transparency, accountability and anti-corruption  its cornerstone. If anything is mismanaged nobody will be in a position to know. So, the earlier they did the audit the better for the nation” he posited.

However, Ahmed Idris, the Accountant General of the Federation, for his part explained that the Federal Government was able to save N4.7 billion that would have been spent on bank charges before the advent of TSA.

He said the amount represented the various charges, interest on loans and account maintenance fees that were hitherto imposed by the deposit money banks for holding funds belonging to the MDAs.

Going by his statement, the Federal Government should have saved N108.1 billion between September 2015 and July 2017.

The initiative, which was used by the government to unify all its accounts, has been complied with by over 900 agencies of the government with 20,000 bank accounts closed while over N5 trillion had been moved from banks to the CBN.

The AGF said the government has been able to block leakages and avoid various bank charges on government funds with the policy.

“The TSA has enabled us to make tremendous gains. We have successfully eliminated multiple banking arrangements resulting in consolidation of over 20,000 bank accounts, which were spread over the Deposit Money Banks across the country.

“This has further brought about transparency and effective tracking of government revenues. It has also led to the blocking of leakages and abuse, which characterised the public financial management before the implementation of the TSA.

“The TSA has taken us out of the era of indiscriminate borrowings by the MDAs and saved government the charges associated with those borrowings, which hitherto amounted to N4.7bn monthly.” ,” he said.

The TSA is a bank account or a set of linked bank accounts through which the government transacts all its receipts and payments and gets a consolidated view of its cash position at any given time.

But an economist, Mr Marcel Okeke, saw nothing wrong in the failure to audit the TSA as long as the government is comfortable with it.

“And since the government appears to be moving on with wherever the money is kept and however the money is kept, I think that is alright. That is okay, as long as it makes good accounting, and government is able to see it, look into its pocket and see 100 per cent of how and where its money is coming from.”he said.

Going down memory lane, Okeke stated that the implementation of the TSA has created some positive scenarios in the country.

He stated: “If you look at what was there  before TSA, where a department of government would have countless number of bank accounts in so many banks at the same time, which created an environment and an atmosphere for corruption, and for the government money to be wasted and lost through all forms of avenues and channels,  we say it is good for the economy and the government in particular.

“The take-off of TSA made a lot of noise and has its positives as it was appreciated by the general public. However, the distribution of the money that has been pooled in the past two years is not making similar headlines; the public does not appear to know how the money is coming out from government coffers, where the whole thing was pooled in the first place.

“But, by and large, I think the government is comfortable with it. And the banking industry that got the shock, because the money was largely pulled out from the banks, has since been able to absorb the shock and has moved on. Of course, no bank collapsed because of TSA. And if anything, it has brought some creativity in banking, not only to survive, but to make the best out of the situation. In that regard, we take it as one of the positives of the TSA.”he said.

Before TSA, every organisation that collected money for the Federal Government stacked it in commercial banks where it would be left to yield interest over the years for individuals and groups while the Federal Government was starved of funds meant for projects.

Recall that on August 11, 2015, the then Head of Service, Mr. Danladi Kisali, directed that all receipts due to the Federal Government or any of her agencies should be paid into the Treasury Single Account (TSA),

Kisali explained that the president’s directive was aimed at aiding transparency and facilitating compliance with Sections 80 and 162 of the constitution.

Details of account as follows; Account Name: Accountant General (Federal Sub-Treasury), Account No. 3000002095 maintained in the Central Bank of Nigeria (CBN), except otherwise expressly approved.

Kisali said MDAs were categorised as follows: implementation strategy affects all MDAs fully funded through the federal government budget – all ministries, departments, agencies and foreign missions, among others; and all collections from these agencies to be paid directly into the TSA (e-collection), and expenditure to be drawn from Consolidated Revenue Fund (CRF) based on the annual budget.

Also, the MDAs partially funded through the federal government budget but which generate additional revenue such as the teaching hospitals, medical centres, federal tertiary institutions, and others, will have all revenue collection to be paid into the TSA (except union dues), sub-accounts linked to TSA to be maintained at CBN, and the system will be configured to allow access to funds based on budgetary approvals.

The ex-head of service said MDAs not funded through the federal budget but are expected to pay an operating surplus or 25 per cent of gross earnings to the CRF such as CBN, SEC, CAC, NPA, NCC, FAAN, NCAA, NIMASA, NDIC, and NSC, among others, would have all collections paid into the TSA (except union dues), sub-accounts linked to TSA to be maintained at CBN, and the system would be configured to allow access to funds based on the approved budget.

According to him, all payments funded from the Federation Account, NNPC, FIRS, NCS, MMSD, DPR  others will have all federation revenue generated paid into Federation Account.

All independent revenue generated by these agencies to be paid into the TSA, while the Federal Government of Nigeria’s share of the Federation Account shall be paid into CRF, and statutorily approved cost of collection will be deducted from Federation Account to meet budgeted expenditure.

For profit-oriented public corporations or business enterprises such as BOI, NEXIM, BOA, Transcorp Hilton, etc, dividends from these agencies are to be paid into the TSA, while the revenue generated under public-private partnerships such as the production of international passports, seaport concessions and others shall be paid into the TSA sub-accounts to be maintained in CBN.

In addition, all the MDAs with revolving funds and project accounts including the Drug Revolving Funds (teaching hospitals, universities), Fertiliser Revolving Fund, Roll-Back Malaria and Sure-P, among others for project account (revolving funds) to be maintained at CBN, collection from these agencies shall be paid to TSA, and the system will be configured to allow access to funds based on approved budget.

“All accounting officers, directors of finance and accounts, directors of internal audit, heads of accounts and heads of internal audit units of MDAs and other arms of government are enjoined to give this circular the widest circulation and ensure strict compliance to avoid sanctions.

“Further enquiries on this circular should be directed to the Accountant-General of the Federation,” the head of service said.

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