Federal Government Revenue & Income: TSA Enforcement Begins Tomorrow

After 48 years of non-compliance, all ministries, departments and agencies (MDAs) of government shall in the next 24 hours commence implementation of the Treasury Single Account (TSA), in line with the directive of the federal government. It will be recalled that President Buhari set Tuesday September 15 as deadline for the full implementation of his directive that all revenue due to the federal government or any of its agencies must be paid into the TSA or designated accounts maintained and operated in the Central Bank of Nigeria (CBN), except otherwise and expressly approved.

Already, to ensure quick compliance with the directive, the head of service of the federation, Danladi Kifasi had given the federal sub-treasury account name and number as Accountant General: 300002095.

Until the president on August 11 2015 gave the directive stopping multiple accounts, the federal government had, since 1967 during the military regime of Gen. Yakubu Gowon, breached its own rules on collection and management of national revenues.

Leadership report continues:

The first time a law was passed on the operation of a single revenue account for the country was in 1954 under the Oliver Lyttelton Constitution and this was implemented until the civil war, when the government said the emergency situation on ground then necessitated multiple accounts to meet its various obligations.

Successive governments after the Gowon regime continued to keep multiple accounts, including the governments of former presidents Olusegun Obasanjo and Goodluck Jonathan, who partially implemented the law.

Section 162, Sub-section 1 of the 1999 Constitution of the Federal Republic of Nigeria (as amended) states: “The Federation shall maintain a special account to be called ‘the Federation Account’ into which shall be paid all revenues collected by the Government of the Federation, except the proceeds from the personal income tax of the personnel of the armed forces of the Federation, the Nigeria Police Force, the ministry or department of government charged with responsibility for Foreign Affairs and the residents of the Federal Capital Territory, Abuja.”

Lawyers commend PMB over directive

Some lawyers who spoke to LEADERSHIP on this development commended the president for his patriotism and courage to implement the law, which has been in existence but without compliance in the last 48 years.

The lawyers, including Tayo Oyetibo (SAN), Joseph Nwobike (SAN), Mohammed Fawehinmi and Wahab Shittu, all noted that though implementation is coming late, the policy would block all leakages and make the tracking of all government money very easy.

While commenting on the matter, Oyetibo (SAN) noted that it was the duty of every government to obey and enforce the law and that although the law on TSA had been ignored by governments at all levels since independence, someone must take a stand by implementing the law and that is what President Muhammadu Buhari had done.

Oyetibo also said President Buhari’s action may be linked to his much-publicized stand against corruption and his love for transparency.

The lawyer said, “So I will say the implementation of the policy is a welcome development that will be highly beneficial to the country. I must also say that giving a deadline for the implementation of the TSA is a wise decision and this shows that the present government has the political will to enforce its policies.

“The only advice I have for the government is that attention must be paid to the possible effect of the policy on banks. If such amount is taken out of the banking system at once, there is no way it won’t affect cash flow. So the Central Bank of Nigeria must develop policy to check this,” he stressed.

Also speaking on the issue, Nwobike (SAN) described the policy as a good development that would aid transparency and the tracking of government revenue.

Nwobike maintained that if the policy was implemented properly, it would help to reduce corrupt practices.

He also said, “Though I must say the law has always been there, past governments had refused to obey it or they lacked the political will to implement the law.

“Though the implementation of the TSA partially started under the administration of former president, Goodluck Jonathan, what was mandated then was that all payment must be made into a single account while government incomes were exempted.

“The beauty of this new directive from President Buhari is that both payments and incomes are now to be deposited into the TSA. This will unify government’s balance sheet and enable government to track revenues and know how much it’s worth. In the past, because government could not track all its revenues, banks were even giving out government money as loans to MDAs.

“I think the deadline is very realistic, because I am aware that over 80 per cent of the MDAs has keyed into the policy and the accountant general of the federation, who is driving the policy, has a committee in place to oversee the implementation,” Nwobike concluded.

On his part, Mohammed, son of the late legal luminary, Chief Gani Fawehinmi, said that the TSA was bound to improve transparency and accountability in public finance management.

He also noted that faithful implementation of the policy would ensure that all government money is in one place and that this would block leakages.

Fawehinmi further said that revenue-generating agencies that have been depriving the Treasury of due revenue through a plethora of bank accounts under their purview and which are not known to the government would no longer be able to defraud the government, since all funds would be in a single account.

He said, “I think this is a very good policy and it is very realistic. The government should ensure that it is fully implemented, unlike what happened under former president, Olusegun Obasanjo and President

“Under the two former presidents, the law was not fully obeyed and this gave room for manipulation and fraudulent practices by civil servants and political appointees.

“I also believe that government at all levels must obey the law. The excuses given by some state governors on why they cannot obey the law are not acceptable at all. They must all key into the policy.”

Also, a lecturer in the Department of Law, University of Lagos, Wahab Shittu said the failure of past governments to enforce the constitution allowed many agencies of government to withhold government funds, remitting only what they liked to the national purse.

We are ready to commence TSA – MDAs

Registrar to the Veterinary Council of Nigeria (VCN) Dr Markus Avong said “the issue of MDAs implementing the Treasury Single Account (TSA) is not optional as it is an instruction with a deadline.

He said for the VCN, the process was not new as the process had existed long before the Buhari led government came into power, we had been long compelled to comply with the new policy.

“For those of us whose monies were mopped up from the commercial banks to the Central Bank of Nigeria(CBN), we had no option but were compelled go along with the process even though not all agencies were affected at the time” he said.

Speaking on the challenges the new policy will bring, he said “ I want to believe if things are done properly, the policy will be for the benefit of all Ministries, Departments and Agencies(MDAs), but for the meantime, it could be a big challenge to those who have failed to effectively manage their Internally Generated Revenues(IGRs)”

“For those who rely on overheads, lots of things can go wrong, but in the long run and if properly run, there will be enormous benefits operating the TSA”, he said

He noted that “some agencies, such as government run institutions (like the Post Graduate Programmes of the College of Veterinary Surgeons) lack the resources to effectively manage without the budget as students do not pay tuition, only practical fees, and with no alternative funding, it had become challenging to recall students when no alternative arrangements have been made”.

He maintained that “while Treasury Single Accounts seemed a great idea there was the need to look into the peculiarities of various agencies to ensure monies not provided for in the budget such as students practical fees are either released or alternative budgets are created by government”

Also speaking Director General of the National Steel Raw Materials Exploration Agency (NSRMEA), Alex Ohikere in an exclusive telephone chat with LEADERSHIP said “We have already closed our accounts and will have no problems complying with the new policy”.