As Nigerians continue to support the Buhari administration on
the firm order for the full implementation of the Treasury Single Account
across all the Ministries, Departments and Agencies of government, it is
imperative for the administration to adopt a holistic approach to public
finance management reforms. The good aspect of the TSA and most of the reforms
that will be stated in this discourse is that they are already provided by law
and policy. As such, the administration is not going on a voyage of discovery.
Rather, it seeks to ensure the enforcement of existing but ignored laws. The
TSA provides the opportunity for the full enforcement of parts of Section 80 of
the 1999 Constitution. Specifically, this establishes the Consolidated Revenue
Fund of the Federation which should be the recipient of all revenues or other
money raised or received by the federation (not being revenues or other money
payable under the constitution or any Act of the National Assembly into any
other public fund of the federation established for a specific purpose). The
money shall be paid into and form one Consolidated Revenue Fund of the
Federation. It further states that all expenditure from the Consolidated
Revenue Fund or any other public fund of the federation must be authorised by
law and in the manner prescribed by the National Assembly. The TSA will curb
leakages in the system and ensure that all due revenues are brought to account
and used for public purposes. This will reduce fiscal criminality and
corruption which has led to revenue loss for the treasury. It will also reduce
the cost of cash management and public borrowing considering that it gives
treasury managers the overall picture of government’s cash position at any
given time and helps the efficient allocation of resources across board to the
MDAs. However, it is imperative from the outset that the government thinks
through the bottlenecks that may arise from the full implementation of the TSA
and the ameliorative provisions of the FRA, so as to avoid giving the reform a
bad name to discredit it. This is because if the TSA is not well-implemented,
it will delay activities and projects across many the MDAs. As such, there will
be all manner of calls for full or quasi-exemptions from the scheme. At the end
of the day, poor implementation will defeat the ends of a very noble scheme.
This is specifically important for agencies that are involved in big ticket
transactions and transactions that require expeditious interventions and
responses to industry challenges. The MDAs that are either self-funding, partly
funded by appropriation and generate a lot of revenue come to mind. These
agencies used to collect and manage their resources and remit operating surplus
to the treasury at the end of the year. Clearly, beyond the legal provisions,
the shortchanging of the treasury and the mismanagement of public resources for
private gain by the managers of these agencies were some of the factors that
led to the establishment of the TSA. The individuals benefitting from the old
order should not be given reasons and excuses to seek to roll back the reforms.
Two key provisions of the Fiscal Responsibility Act are important for the full
realisation of the objectives and benefits of the TSA. The relevant provisions
are Sections 25 and 26 providing for the preparation of the Annual Cash Plan
and Budget Disbursement Schedule. In Section 25 of the FRA, the Federal
Government through the Accountant-General of the Federation is to prepare then
Annual Cash Plan which shall be prepared in advance of the financial year
setting out projected monthly cash flows and shall be revised periodically to
reflect actual cash flows. The preparation of the Annual Cash Plan will
facilitate budget implementation because it will evolve from a Cash Management
Policy and will partly inform inflows into the TSA, outflows and actual release
and disbursements to the MDAs. To underpin the Annual Cash Plan will be the
Cash Plan of the respective revenue generating and spending MDAs. The provision for the Budget Disbursement Schedule in Section 26
is also very important for the TSA. It mandates the Minister of Finance, within
30 days after the enactment of the budget to prepare and publish a Budget
Disbursement Schedule derived from the Annual Cash Plan for the purpose of implementing
the budget. This Schedule should be underpinned and informed by the projected
Financing and Implementation Schedule of all MDAs. For a budget to meet its
targets, there should be a systematic financing programme that takes into
account the special and strategic needs of the spending agencies. A haphazard
release of funds or the denial of funding when an agency needs it most had been
the bane of budget implementation. Thus, the Annual Cash Plan and Budget
Disbursement Schedule will introduce the element of predictability in
disbursement of appropriated funds. Unfortunately, in the past, neither the
Accountant-General nor the Minister for Finance did their duty as provided by
the FRA. At no time did they prepare the required documents. When challenged in
a suit in court, the immediate past Minister of Finance merely divided the MDA
budgets into four – the four quarterly releases and presented the same as the
Budget Disbursement Schedule. If in all honesty, this is the idea of the
Ministry of Finance of a Budget Disbursement Schedule, we do not need to look
far to explain the failure of succeeding Nigerian federal budgets. If for
instance, you simply divide the capital budget of the Ministry of Agriculture
into four and release them in equal instalments, you will be releasing money
for seeds, fertilisers and general farm implements at a time they have been
overtaken by events. It is also important for the Executive to ensure that
Nigerians get fully informed of the gains and benefits from this scheme and
other fiscal reforms as it unravels. For instance, quarterly briefings on how
much have been saved by the scheme will be imperative. The Ministry of Finance
and the Budget Office of the Federation need to take their duties under the FRA
seriously. They are under the law bound to monitor and evaluate the
implementation of the budget and report on a quarterly basis to the Fiscal
Responsibility Commission and Joint Finance Committee of the National Assembly.
The report is to be published in the mass and electronic media not later than
30 days after the end of each quarter. Unfortunately, the Budget Office of the
Federation has neglected to perform this duty as the last available report is
for the second quarter of 2014! This is unacceptable and a clear dereliction of
duty. In the final analysis, the full implementation of the TSA is a step in
the right direction. But it needs to be noted that the idea is now new. It has
been around since the administration of Presidents Olusegun Obasanjo, Umaru
Yar’adua and Goodluck Jonathan. What will separate the outgone administrations
and the current one will be the commitment and political will to make it
succeed despite all odds. Good job Mr. President.
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