By Emmanuel
Udom
Minister of Finance, Mrs Kemi Adeosun, has issued a circular
on guidelines regarding budgeting, revenue and expenditure aimed at ensuring
that MDAs remit revenue and generate operating surpluses which by law ought to
be credited Consolidated Revenue Fund (CRF).
The
circular is aimed at compelling boards and agencies that currently operate
outside of budgetary control to comply with the law Section 22(2) of the Fiscal
Responsibility Act (FRA).
Some
of the more than 800 federal government agencies affected by the order are: NPA,
NIMASSA, NAFDAC, JAMB, NTA, NCC, CAC, NECO. These agencies are to remit 80% of
their operating surplus into the Consolidated Revenue Fund Account.
The minister further stated that
records show very poor compliance with the provisions of the Fiscal
Responsibility Act. Some agencies have never credited the Consolidated Revenue
Fund despite having salary, capital and overhead financed by the Federal
Government.
“Indeed, cost to income rates of
99.8% have been the average, meaning that they spend all their internally
generated revenue and subventions released to them”.
The Minister said such practices are
not sustainable in any economic climate and with the current serious economic
challenges being faced by Nigeria, can no longer be tolerated. Accordingly, all
revenue generating agencies must comply with the circular and cut their costs.
In the circular sent to MDAs, the
Minister said revenues generated by all Ministries, Departments and Agencies
(MDAs) must be reported on a gross basis prior to any deductions. Also, all
self funded Federal Agencies are to limit their annual expenditures from their
internally generated revenues to not more than 75% (Seventy Five percent) of
their total gross revenue, while fully funded agencies are to remit all their
internally generated revenue (IGR) to the Consolidated Revenue Fund (CRF).
The Circular said that henceforth,
80% of the resulting operating surplus by MDAs should be remitted into the
Consolidated Revenue Fund (CRF) on a quarterly basis, in accordance with the
Fiscal Responsibility Act.
To ensure continual monitoring, the
circular required all MDAs funded through the annual budget must submit monthly
Expenditure Transcripts and Revenue Returns, to the Office of the
Accountant-General of the Federation (OAGF), while agencies not funded through
the annual Federal Government budget are to prepare and submit Quarterly
Management Accounts including Revenue Returns to the OAGF.
The Minister reminded all MDAs that
in line with Financial Regulations (FR) 107, the Accountant-General of the
Federation shall carry out routine revenue monitoring and inspection visits to
the MDAs to verify compliance with the new guidelines.
The circular said any Accounting
Officer/Chief Executive Officer of MDAs that defaults in remitting revenues as
appropriate and as when due shall be sanctioned accordingly and the renewal of
the tenure of appointment of Accounting Officers/Chief Executive Officers shall
be tied to their compliance with the content the new guidelines.
Source: Marshall
Gundu
Director
(Press), Federal Ministry of Finance, Abuja
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