Fiscal responsibility: antidote against corruption
Politics aside, most poor people in the North of Nigeria have been fed the media impression that the current president Muhammadu Buhari is a man that likes transparency and fiscal responsibility. In local parlance, they called him “sai maigaskiya” the man of honesty.
Anyway, this was long before Muhammadu Buhari assumed the mantle of an elected president.
For the last four years, it is believed that a significant percentage of these hitherto loyal fans of Mr. president, who having been buffeted by near intractable poverty, expanding insecurity and bleak economic future, may not be in the good frame of mind to see him still as that man who loves transparency and fiscal responsibility.
Few day back, a powerful traditional ruler in the home state of President Muhammadu Buhari warned against the weakness of the Federal government to bring criminals to face the full weight of the law.
Again, only yesterday, hundreds of thousands of poor people and peasants openly demonstrated against the president for not living up to expectation. These protesters say they no longer see the president as a man who loves fiscal responsibility which would have led to drastic economic relief measures that would have transparently checked the rise in widespread mass hunger, poverty, deprivation, want and joblessness.
Worried that he is beginning to lose track of some of his die-hard supporters amongst the poorest of the poor, the president made up a media presentation in which he appeared to be castigating the elite for not doing enough to half the widening poverty in the land.
Good as the statement above made by the president may be, it is of essence to call his attention to the fact that one way to check the trend of poverty which drives up crime and social discontents is to enforce fiscal responsibility in all the projects that government is executing so the impacts are felt across board.
It is a notorious knowledge that procurement corruption within Federal and state agencies account for much of the developmental challenges that Nigeria face.
Surprisingly, even with the Fiscal Responsibility Commission in place backed up by law, the institution suffers too from abysmal and historical neglect and marginalization to a cruel extent that the commission old as it is since establishment by law but in Abuja it operates from a rented apartment as a highly pathetic tenant unable to effortlessly pay her rents.
There is also the reports in some media houses that the Fiscal Responsibility Commission is treated as an orphan who has no parents to protect it from rogue officials who are in the evil habit of circumventing both the public procurement laws and the fiscal responsibility bench marks in the design and execution of projects that ought to positively and constructively impact on the living standards of Nigerians.
This is where the interest of this piece lies.
The current president should holistically deliver urgent funding lifeline so the enforcement of fiscal discipline in the implementation of all government’s projects are enforced without let or hindrance.
To start with, the Fiscal Responsibility Commission needs to operate from its own facility because of the strategic and sensitive mandates that the enabling law clothed them with.
The Fiscal Responsibility Act of 2007 is all embracing and must be enforced holistically.
The Fiscal Responsibility Act 2001 known as 2007 ACT No. 31 is an act to provide for prudent management of the nation's resources, ensure long-term macro-economic stability of the national economy, secure greater accountability and transparency in fiscal operations within a medium term fiscal policy framework, and the establishment of the fiscal responsibility commission to ensure the promotion and enforcement of the nation's economic objectives; and for related matters enacted by the National Assembly of the Federal Republic of Nigeria:
Specifically, a reading from PART I-ESTABLISHMENT, FUNCTIONS AND POWERS OF THE FISCAL RESPONSILIBILITY COMMISSION states as follows: 1. (1)There shall be established, a body to be known as the Fiscal Responsibility Commission (in this Act referred to as "the Commission"). (2) The Commission shall be a body corporate with perpetual succession and a common seal and may sue and be sued in its corporate name.2. (1) For the purpose of performing its functions under this Act, the Commission shall have power to :(a) compel any person or government institution to disclose information relating to public revenues and expenditure; and(b) cause an investigation into whether any person has violated any provisions of this Act. (2) If the Commission is satisfied that such a person has committed any punishable offence under this Act violated any provisions of this Act, the Commission shall forward a report of the investigation to the Attorney-General of the Federation for possible prosecution.
3.(1)The Commission shall:
(a) monitor and enforce the provisions of this Act and by so doing, promote the economic objectives contained in section 16 of the Constitution;
(b) disseminate such standard practices including international good practice that will result in greater efficiency in the allocation and management of public expenditure, revenue collection, debt control and transparency in fiscal matters;
(c) undertake fiscal and financial studies, analysis and diagnosis and disseminate the result to the general public ;
(d) make rules for carrying out its, functions under this Act; and
(e) perform any other function consistent with the promotion of the objectives of this Act.
(2) The Commission shall be independent in performance of its functions.
(3) The provision of Public Officers Protection Act shall apply to the members of the Commission in discharge of their functions under this Act.
4.---(1)The Commission shall establish and maintain a Fund from which shall be defrayed all expenditure incurred by the Commission.
(2) There shall be credited to the Fund established pursuant to subsection (1) of this section, the budgetary allocation from the Federal Government and grants from any other source.
5.---(1) The Commission shall consist of:
(a) a chairman, who shall be the Chief Executive and accounting officer of the Commission;
(b) one member representing: (i) the organized private sector; (ii) Civil Society engaged in causes relating to probity, transparency and good governance, (iii) organized labor; (c) a representative of the Federal Ministry of Finance of a level not below the rank of a Director; and (d) one member to represent each of the following six geopolitical zones of the country, that is: North-Central, North-East, North-West, South-East, South-West and South-South.
(2) All members of the Commission shall be persons of proven integrity and must possess appropriate qualifications with not less than 10 years cognate post qualification experience.
(3) The Chairman and other members of the Commission other than ex-officio members shall be appointed by the President subject to confirmation by the Senate.
(4) The Chairman and members representing the six geo-political zones shall be full time members.
6. The Chairman and members of the Commission shall hold office for a single term of 5 years.
7. The Commission shall have power to:
(a) formulate and provide general policy guidelines for the discharge of the functions of the Commission; (b) superintend the implementation of the policies of the Commission.
It was whilst I was watching president Buhari as he blames the elite for the widening poverty of millions of people that I remembered that if the Federal government had ensured the effectiveness of the Fiscal responsibility commission imbued with all the noble mandates, then by now Nigeria could not have slipped into the inglorious and notorious position as the world’s poverty capital overtaking India.
Fortunately, a reputable journalist with African Independent Television Dr. Amaechi Anakwue recently wrote a 175 page book titled “The politics of Economic regulation in Nigeria”.
This writer exactly echoes the sentiments that such regulatory bodies in the economy need to be constantly allowed to be financially autonomous.
He wrote: “Political considerations in their appointments rob the country of the much-needed quality manpower to drive regulatory activities in critical sectors of the nation’s economy. Party men and women exert all manner of pressure on the president to concede appointments to their eronies, thereby compromising standards and competence. Some CEO’s of regulatory agencies in Nigeria are card-carrying members of political parties, mostly ruling parties. Some others that were not initially politicians begin to eye and do contest for political offices at some point in their tenure or completion of it”.
“Regulatory activities should be knowledge driven. Clear understanding of nuances, complexities, intricacies and nitty-gritty bof the sector is not only imperative, but mandatory for efficient operation of the sector. Every regulated industry is dynamic. It is constantly transformational. So, even experienced and competent regulators may not be enough to tracend the sector and serve as a leviathan. A continuous update of knowledge base and better understanding of international best practices will help to seek the dialectical operating environment in check”.
He affirmed that: "In Nigeria, executives’ orders are also sometimes issued. On Friday may 19, 2017, Acting president Yemi Osibajo issued three executive orders. According to a Proshare Intelligent Investing publication, among the three orders in one of timely submission of annual Budgetary estimates by all statutory and non-statutory agencies, including companies owned by the federal government.
The order demand that all federal government agencies shall, before the end of July every year, cause to be prepared and submitted to the minister of finance and minister of budget and planning their annual budget estimates, which shall be derived from the estimates of revenue and expenditure as projected in their three-year schedule.
The order also notes that heads of agencies and chief executive officers of government owned companies shall take personal responsibility for any failure to comply with this order.
Dr. Anakwue argued that this is a clear usurpation of the powers and functions of the Fiscal Responsibility Commission. The act establishing the commission explicitly gave it the mandate to compel ministries, departments and agencies to do exactly what the executive order is craving to achieve.
He posited further: "As I stated earlier, the commission serves as regulators to ministries, agencies and parastatals, MDA’s, in that it endures and enforces prudent managements of the nation’s resources, long term macro-economic stability of the national economy, greater accountability and transparency in fiscal operations within a medium-term fiscal policy framework and promotions of Nigeria’s economic objectives."
"It was clearly stated in section 1, subsection (2) that the commission shall be independent in performance of its functions. Though appointed by president and confirmed by senate, its board enjoys full independence in carrying out its prescribed roles."
With this independence, he, reaffirmed the commission can, upon realization that a public officer or institution violates the provision of fiscal responsibility act, forward a copy of its investigation to the Attorney General of the federation for possible prosecution.
The FISCAL Responsibility Act stipulates timeline for ministries, departments and agencies on the submission of their annual budgets. This is the same message that the acting president’s executive order conveys.
He then asked; Is it that the presidency is not aware of the provisions in the Fiscal Responsibility Act? Or is it that it acknowledges the failure of the Fiscal Responsibility Commission, the body responsible for the implementation of the Fiscal Responsibility act? Or perhaps, the executive order is meant to reinforce and complements the functions and roles of the fiscal responsibility commission?
He said this, no doubt is another violation of the independence of a statutorily independent regulatory institution in Nigeria. Is it the failure of the regulatory institutions in living up to their responsibilities that provides the opportunity for the president to invade and violate their independence? Or is it a calculated and concerted effort to undermine their operations for pecuniary reasons?
He reminds his readers that the five-year tenure of the board of fiscal responsibility commission with Jubrin Yelwa as chairman expired in 2013. The board provides guidelines for the operation of the commission besides being its highest decision-making organ. Up till May 2017, no new board had been put in place, thus nearly paralyzing its operations. The commission had remained a spectator as ministries, departments and agencies freely violate the provisions of the fiscal responsibility act.
"The MDA’s and government owned companies are supposed to remit their operating surplus to government treasury. Section 22, sub section 1 of the fiscal responsibility act demands that 80% of operating surplus of the agencies, or four-fifths should be paid into the consolidated revenue fund, while one-fifth or 20% should be retained as operational costs."
This directives has been continually ignored. The Fiscal Responsibility Commission he lamented has been weak in enforcement. There is a widely-held belief that the refusal of government to reconstitute the board of the commission since 2013 and the perceived lack of cooperation and support from the government are part of a plot to render it ineffective.
An efficient, functional and powerful Fiscal Responsibility Commission would to a large extent, stop the diversion of government funds by revenue generating agencies and companies. This has regrettably remained a conduit pipe for slush funds, Dr Anakwue concluded(“The Politics of Economic Regulation in Nigeria” by Amaechi Anakwue).
May i humbly appeal to President Muhammadu Buhari's administration to halt the incredible neglect of the fiscal responsibility commission if we aim to enthrone fiscal discipline in the spending of tax payers money.
*Emmanuel Onwubiko heads Human Rights WRITERS ASSOCIATION OF NIGERIA (HURIWA) and [email protected] ; www.thenigerianinsidernews.com ; www.huriwa.blogspot.com .