Ministries, Departments and Agencies (MDAs) and banks are holding back against a push by the Federal Government for the full implementation of the single treasury account, (TSA) BusinessDay investigations show.
Consequently, Kemi Adeosun, finance minister and some other analysts have traced the less than satisfactory performance of the policy, as manifested through reduction in revenues to the coffers of the government, to poor computerisation, lack of skilled manpower and corruption, among others.
Insistence by some banks on the principle of confidentiality between them and their customers is believed to be working against smooth implementation of the policy.
BusinessDay analysis further showed that the summary of gross revenue allocation by FAAC committee shared among the states within the last six months, from June last year, showed progressive decline.
For instance, last June was (N923.9bn); July, (N521.3bn); August, (N442.6bn) and September, (N398.9bn). Others are October, (N473.8bn); November, (369.9bn) and December, (N387.8bn).
Other analysts are calling on Adeosun for the periodic reviews of the policy and how it has reduced government’s borrowing from the Central Bank of Nigeria (CBN), through ways and means.
The minister, at the one day TSA workshop in Abuja for states accountants-general yesterday, urged the participants to also discuss and brainstorm on ways and means of improving the revenue base of the country through full implementation of TSA and blocking of all leakages and improving the efficiency of revenue administration.
“The revenue base of the country is still low and its administration still leaves room for improvement. This is bedevilled with a range of problems, such as poor computerisation, lack of skilled and dedicated employees, corruption, lack of awareness and of course, unpatriotic conduct by some of the operators.
This clearly indicates that the underlying assumptions underpinning the 2016 budget may only be realised with serious efforts put in place towards revenue efficiencies and expenditure discipline, such as implementation of the TSA and Cash Management concepts by all tiers of government,” Adeosun said.
Ayodeji Ebo, head, investment research Afrinvest said, “In order to have a total compliance of remittance into the TSA, the Ministry of Finance and the Auditor General’s office would need to work closely with the ministries and parastatals to ensure they have full information about the reforms and the necessary changes in their banking and payment arrangements.
Also, we are of the view that the ministry of finance, in conjunction with the CBN, has to come up with efficient policies that will cater for adequate sanctioning of any commercial bank that runs an account(s) for any government ministry or parastatals (except the exempted ones), thereby plugging the hole from the commercial bank end of the erroneous transactions.”
Bolade Agbola, executive director, Cashcraft Asset Management limited said, “There is no doubt that there should be some exceptions in the implementation of TSA .Institutions that need instant cash to carry out their functions, such as hospitals, universities and financial institutions, should have a part of their finance separated from TSA but they must operate based on a strict budget based on the need to curb corruption.”
Adeosun further said the policy has provided government with financial information on the revenues of agencies funded by government and has reduced revenue suppression, adding that the information is being used to drive their programme to enforce compliance with the Fiscal Responsibility Act and ensure that Revenue Generating Agencies generate expected surpluses and remit to the Federal Purse.
TSA, she added, has eliminated opportunities for brokerage and other corrupt practices that previously encouraged agencies to accumulate funds with commercial banks, rather than apply them to their intended uses. “We believe that this will reduce payment delays to contractors, minimise late payment penalties and will consequently improve project completion times and service delivery.
“It is worth reiterating some of the key benefits of TSA that we have recorded to date: TSA at Federal Level has allowed, for the first time, visibility of the total quantity of government funds at any point in time.
The balance, which changes daily as MDA’s remit revenues and make payments, according to the latest reports from the CBN, exceeds N2.2 Trillion. I can report that work is now ongoing within the Treasury, to determine how much of these funds can potentially be utilised to part fund the 2016 budget and how much relates to pending commitments. This, of course, will reduce the amount to be borrowed,” she said.
John Omachonu
