BPE, NPA, NTDC, NIMASA, Customs Top List of Serial Offenders as MDAs Deny govt of Billions

The spate of disregard to the fiscal laws of the country by Ministries, Departments and Agencies (MDAs) has led to the denial of billions of naira to the coffers of government.

A report by the Fiscal Responsibility Commission (FRC) lists the Bureau of Public Enterprises (BPE), Nigeria Ports Authority (NPA), Nigerian Tourism Development Corporation (NTDC), Nigerian Maritime Administration and Safety Agency (NIMASA), the Nigeria Customs Service (NCS), the Nigeria Communications Commission (NCC), the Federal Airports Authority of Nigeria (FAAN), the Nigeria Electricity Commission (NERC) and the Nigeria Social Insurance Trust Fund (NSITF) as among the greatest culprits in the breach of the law.

The FRC however stated in the report that some 22 agencies remitted a total of N687,825,767,000 as operating surpluses to the consolidated revenue fund of government between 2007 and 2015. This performance indicates that the government could have raised trillions of naira as operating surpluses from its agencies had there been full compliance to the fiscal law.

The report tagged ‘2015 Annual Report and Audited Accounts of the Fiscal Responsibility Commission’ released recently specifically listed the BPE, NCS, NERC, NSTIF as agencies that have never remitted any operating surplus to government purse as required by law between 2007 when the Fiscal Responsibility Act (FRA) came into effect and 2015 when the Commission capped the period of the study.

The Nigerian National Petroleum Corporation (NNPC) and the National Environmental Standards Regulatory Agency (NESRA) were also listed as agencies that have never made any remittance to government between 2007 and 2015, although the state petroleum company claims in correspondences to the FRC that it had always operated a negative balance sheet during the period under review.

As for the NCS, OrderPaper.ng gathered that the service failed to comply with the law because of its neglect of standard accounting principles in running its affairs as the “Customs until recently did not maintain a standard accounting/auditing template with respect to its internal operations,” according to a source who craved anonymity because he was not authorized to speak on the matter.

Section 22 (1 and 2) of the FRA states: “Notwithstanding the provisions of any written law governing the corporation, each corporation shall establish a general reserve fund and shall allocate thereto at the end of each financial year, one-fifth of its operating surplus for the year. The balance of the operating surplus shall be paid to the Consolidated Revenue Fund of the Federal Government, not later than one month following the statutory deadline for publishing each corporation’s accounts.”

The FRC is by the Act setting it up required to publish an annual report on the state of compliance of scheduled corporations and agencies with the relevant aspect of the FRA and is empowered by Section 2(1a) “to cause an investigation into whether any person has violated any provisions of this Act.”

Thus in its 2015 report, the FRC said “even though many other agencies are involved in varying degrees of non-compliance with Part IV of the Act, the more serious instances which have lingered for a while involve NIMASA, NCC, FAAN, BPE, and NTDC.”

According to the report, “the BPE is perhaps the most recalcitrant and refractory amongst all the agencies/corporations mentioned herein being that it has continued, with impunity, to refuse/fail to pay/remit the sum of N81,814,000 into the Consolidated Revenue Fund, being 80% of its Operating Surplus for 2007 as disclosed in its approved audited financial statements despite series of meetings and briefings over the years. It has also been non-compliant in other issues relating to submission of its approved budgets, scheduled estimates of its revenue and expenditure for the next three financial years (similar to MTEF) and audited accounts for 2012 to 2015 financial years.”

Frustrated by the BPE’s serial flouting of the law, the Commission said “as consequence of the BPE’s deliberate, flagrant and disdainful disregard of its compliance obligations under the FRA 2007 notwithstanding the prolonged indulgence of the Commission which clearly amount to a brazen violation of the extant provision of the Act, the Commission is now left with little option other than to act in accordance with the provision of Section 2(2) of the FRA 2007.”

With respect to the NTDC the report acknowledges that a 2012 investigation into the activities of the corporation is ongoing but laments that “it is proving intractable due to the investigators inability to reach/contact some former directors/senior officers of the agency including its formal external auditors to invite them to come and clarify some serious discrepancies discovered in some financial statements of NTDC made available to the Commission.”

The report continues: “There is also the unresolved issue of the agency’s failure to remit the balance of its operating surplus from 2007-2011 in the sum of N160,000,665.04 as indicated in its records. The agency’s audited financial records, approved budgets, scheduled estimates of its revenue and expenditure for the next three financial years for 2012 to 2014 are part of the issues in contention.”

On NIMASA, the report said: “The Commission’s investigations into the NIMASA’s non-compliance with its statutory responsibilities under Part IV of the Act which began in 2012 is still ongoing. There have been several meetings and inspection/investigation visits undertaken since then but the issues are yet to be fully resolved.” The Commission however acknowledges that “one contributory factor is the constant changes in the management of the agency.”

In the case of the NCC, the report said a sum of N99,385,067.61 established as operating surplus for the period between 2007 to 2010 is yet to be paid “in spite of constant reminders by the Commission,” adding that “there are outstanding issues relating to determining the actual operating surpluses due for 2011, 2012, 2013, and 2014 vis-a-vis the status of remittances actually made to the treasury by the NCC for the said period.”

As for FAAN, the report said although the agency made a belated payment of N680,000,000 in tranches into the treasury as outstanding operating surplus for 2009-2013, “not much else have been resolved.”