By Abel
O. Victor
“Our nation’s economic future and fiscal responsibility are directly linked. There is a tie between fiscal responsibility and financial prudence today and what society can enjoy tomorrow”. These were the exact words of late President Umaru Musa Yar’Adua during the inauguration of the Fiscal Responsibility Commission (FRC) in 2008.
The call for the reform of public finance management in Nigeria dates back to Obasanjo’s and Yar’adua’s administration when key sunshine bills were passed and signed into law. The Fiscal Responsibility Act (FRA), Public Procurement Act, and Extractive Industries Transparency Initiative Act were regarded as the sunshine laws that will bring about fiscal regime where transparency, accountability and fiscal prudency will reign supreme. But years down the line, much achievement has not be recorded due to one reasons which could be tied to federal government refusal to fully administer the law, the appointment of unsound management team to run some of the commission and the reign of the blue sea world called corruption fuelled by impunity.
Before the establishment of the FRA, some mischief existed which drew back the wheel of economic progress in Nigeria. There was a boom burst fiscal cycle, no saving culture, unstable borrowing, debts and deficit beyond prudential limits, poor intergovernmental fiscal relations, access to fiscal information was limited due to the culture of official secret Act and “Nichodemous” fiscal operation shrouded in secrecy, popular participation and input into budget process was very minimal and accountability was a total challenge. Then came the FRA and was made as an Act to provide for prudent management of the nation’s resources, ensure long term macroeconomic 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 FRC to ensure the promotion and enforcement of the nation’s economic objectives and for related matters.
But the recent move by the government to scrap the FRC and transfer the administration of the Act to Revenue Mobilization and Fiscal Commission (RMAFC) as suggested by the Orosanye committee seems to be like a journey back to Egypt. Both commissions may have “fiscal” attached to their names but certainly their core mandates differ. The RMAFC is charged with monitoring accruals into and disbursement of revenue from Federation Account as well as determine the remuneration of political office holders while the FRC is to enthrone a regime of prudent, ethical and effective management of public monies and resources across three tiers of government. The commission is mandated to reform the management of public finances through regular monitoring of government financial activities.
The appointment of politicians and some other persons who did not understand the core functions of the commission and what it takes to enthrone a sound fiscal regime was the major reason for the commission ineffective and inefficient discharge of her responsibilities. Secondly, the commission is encumbered by both legal and operational constraints in carrying out its mandate. For instance, while offences are provided by the Act, sanctions are not indicated. In addition, the commission is not empowered to prosecute – a case of a dog that can bark but cannot bite.
The white paper released by the government on the implementation of the Orosanye Committee report which is aimed at pruning down the cost of governance is a welcome development but should not be used by government to throw away the FRC which it has contributed to its ineffectiveness. Since the existence of the commission, only 3.735billion has be allocated to the commission from the federal budget but the commission has paid back a total of 220.289 billion from 2009 to 2012 as operating surplus.
If the government really wants to cut down the cost of governance, why being silent on the issues of service wide vote? Why the delay on complete implementation of the Integrated Personnel Payroll Information System (IPPIS)? Why the refusal to implement the monetization programme? Why budget huge sum for refreshments, meals and welfare packages each years? Why the year in and year out rebuilding and remodeling of Vice president lodge? Why the constant loan borrowing of the federal government without cost benefit analysis and tying it to a known capital project as required by the FRA? Is this not an attempt to rubbish the fiscal responsibility Act which the government has not fully obeyed?
Let’s not take a journey back to Egypt by scrapping the FRC which core mandate is to administer the FRA which came onboard to bring Nigeria out of fiscal mismanagement when truly implemented. Rather, the federal government should reconstitute the team of management of the commission and bring in technocrats who have passion for change and understand what it takes to enthrone fiscal responsibility. Conduct a staff audit to ensure that the commission is not made up of staff who display gross incompetence and lackadaisical attitude to work and finally try as much as possible to make the commission independent.
Victor wrote from the Centre for Social Justice, Abuja
