Non remittance of revenue: Group petitions EFCC

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An anti-corruption coalition,Civil Society Network against Corruption (CSNAC), has urged the Economic and Financial Crimes Commission (EFCC), ‎to immediately commence investigation into an alleged non-remittance of generated revenue by about 600 government agencies.
In a petition forwarded to the acting chairman of the anti-graft commission‎, Mr. Ibrahim Magu, the group through its chairman, Mr. Olanrewaju Suraju, said the alleged non-remittance of generated revenue is a great disservice to the nation as well as an economic sabotage.

The coalition said it took its cue from the February 26, 2016, report of an online Newspaper, The Cable, where it was reported that about 600 government agencies under-remitted generated revenues to the Federal Government.

According to the report, these agencies include Nigerian National Petroleum Corporation (NNPC), Nigeria Television Authority (NTA), National Agency for Food, Drug Administration and Control (NAFDAC), Nigeria Ports Authority (NPA), among others.
“In a National Assembly Budget and Research Office (NABRO) report, obtained by TheCable, titled ‘Improving revenue collections and remittances by federal government agencies,’ it was gathered that the NNPC, which should have remitted N3.02 trillion to the Consolidated Revenue Fund (CRF) between 2007 and 2011, made no payment.”

According to the report, The Federal Government has nearly 600 agencies covering a wide spectrum of activities such as central and mortgage banking, insurance, oil and gas, maritime administration and safety, air and sea port management and so on.

“These agencies control trillions of Naira, but paradoxically, they account for only 5 per cent of the federal government budget deficit financing…the record shows that none of them, except those managed by technical partners (NITEL, NIGERDOCK, NAFCON etc.), make profits.”

“In a calculated disregard for the provisions of the Fiscal Responsibility Act, that mandated government agencies to remit 80 percent of their operating surplus to the Consolidated Revenue Fund (CRF) of the FG, while keeping 20 percent in the agency’s general reserve fund. Though the Act only covered 31 out of the 500 government agencies, most of the agencies listed have faulted in compliance. Since they were told to remit 80 percent of operating surplus, these agencies, began to post losses rather than surpluses, thereby remitting no amount to the federal purse.

“Federal Radio Corporation of Nigeria, Financial Reporting Council of Nigeria, News Agency of Nigeria, Nigerian Civil Aviation Authority, Nigerian Copyright Commission and the Nigerian Export Promotion Zones Authority,” all recorded losses. “The highest deficits were recorded by Federal Road Maintenance Agency (N18.30 billion in 2011), Nigeria Export-Import Bank (N5.46 billion in 2009), Federal Mortgage Bank (N3.58 billion in 2010), Nigerian Communications Commission (N5.76 billion in 2009 and N7.49 billion in 2010) and the Nigerian Communication Satellite (N3.33 billion in 2009).

“Furthermore, following the obvious disregard for the FRA, the federal government under Goodluck Jonathan, and the ministry of finance under Ngozi Okonjo-Iweala, in November 2011, directed these agencies (particularly the revenue generating agencies) to remit 25 percent of their gross operations revenue to the CRF.”

“This directive led these agencies to under-report their revenues, so they could remit less to the federal government. For instance, in December 2012, NABRO claims “the Financial Reporting Council expected to receive N1.61 billion as subvention from the government in 2013, generated N4.28 billion internally, and posted a surplus of N85.69 million”. This happened across many of the agencies listed in the report.”

The report also stated that though WAEC was not listed in the FRA, the council was expected to pay 80 percent of its operating surplus and 25 percent of its IGR to the federal purse, but the NABRO report shows otherwise.

“WAEC did not remit any amount between 2009 and 2012. The N1.93 billion that the Council should have paid into the CRF of the Federal Government during the period was kept for future use. “In effect, the Council had regard for neither the provisions of the FRA, 2007 on remittances nor the directive of the Federal Ministry of Finance to remit 25% of its gross IGR to the CRF.”
“However, the WAEC act of 1973 does not explicitly state that the council should remit any amount to the federal purse. NAFDAC also contravened FRA 2007, holding on to an operating surplus of over N500 million. “NAFDAC recorded deficits in 2010 and 2011 but had a surplus of N759.6 million in 2009. Of this amount, N607.68 million was to be remitted to the CRF,” the NABRO report read. “However, the audited accounts and treasury receipts indicate that only N105 million of this amount was paid in 2011. Thus, the authorities of NAFDAC are yet to remit the outstanding 2009 operating surplus of N502.68 million.”

“Finally, NPA indicated in its summary of financial report (2009 to 2012) that it remitted N5.17 billion on August 26, 2009 in respect of its 2009 operating surplus, but the Office of the Auditor General of the Federation stated that only N3.02 billion was received from the NPA in the same year.

“The NPA also “stated that the sum of N3.50 billion was remitted on January 26, 2011 and July 25, 2011 with regard to its 2010 operating surplus”. “The OAGF was surprisingly unaware of this as the NPA did not provide any evidence of this remittance, saying NPA ‘did not make any remittance in 2010 but made a total remittance of N1.1 billion in 2011 out of which the sum of N167.9 million was in respect of 2009 while the sum of N1 billion was on account of 2010’.” For the NNPC and its subsidiary NAPIMS (National Petroleum Investment Management Services), generated trillions of naira and failed in remittance. According to NABRO, NAPIMS “earned N9.58 trillion (excluding proceeds from crude oil and gas) between 2009 and 2011 and accumulated a surplus of N2.07 trillion”.
“Hence, the NNPC ought to have remitted the sum of N1.65 trillion to the CRF. However, the sums of N338.26 billion, N572.22 billion and N746.17 billion (due to the Government) were retained and stated as having been transferred to revenue reserve in 2009, 2010 and 2011 respectively.” The remittance shortfall of some of the other agencies are: “CBN (N45.56 billion); NIMASA (N35.89 billion); NPA (N26.9 billion); Industrial Training Fund (N15.2 billion); Nigeria Deposit Insurance Corporation (N8.7 billion); Federal Airport Authority of Nigeria (N6.92 billion); West African Examination Council (N4.5 billion); Nigerian Communications Commission (N3.8 billion); Nigerian Airspace Management Agency (N3.2 billion); National Agency for Food, Drug Administration and Control (N1.81 billion); National Broadcasting Commission (N627.0 million); Federal Mortgage Bank (N300.3 million); and the Federal Housing Authority (N221.1 million).” NABRO’s findings conclude that all the agencies under study generated the sum of N12.24 trillion internally between 2009 and 2012 (excluding NNPC and NAPIMS), but failed to remit a total sum of over N256.35 billion to the consolidated revenue fund.”

The coalition, however stated that, “Government agencies, besides helping the government to deliver dividends of governance to the citizens, also ought to serve as avenues through which the government ought to generate revenue for its daily activities.

“In recent times when the country is experiencing severe economic hardships due to low revenue from crude oil sales and foreign exchange, the billions of revenue generated from various government agencies, if remitted would have gone a long way in cushioning the effects of the economic realities. The non-remittance of generated revenue by the aforementioned agencies is a great disservice to the nation as well as an economic sabotage.

CSNAC is therefore demanding that the commission conducts a thorough investigation into the issues raised herein as well as the prosecution any individual found culpable. This will contribute greatly to sanitizing government agencies in Nigeria,” the petition reads.

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