FG: REVENUE MOBILISATION IS CRITICAL TO OUR SUCCESS
While delivering the keynote address at the NSE-BLOOMBERG CEO Round Table in Lagos on Friday, the Minister of Finance, Mrs. Kemi Adeosun, said that revenue mobilisation is critical to the success of Nigeria’s economic reform agenda.
She said: “For the size of our Government, the size of our economy and the size of our needs, Government revenue is simply just too low”. We see increasing revenue as the long-term strategic solution for sustainable and inclusive growth. Revenue is required in the short-term for investments and in the medium to long-term for our debt service.
Our acceptance that our ambitions cannot be financed by oil revenue is an equal acceptance that there is a finite limit to how much can, and should be financed by debt. If we don’t want to borrow, we need more revenue.
The problem is not that our debt service is too high but our revenue is too low and the manner in which the imbalance between our debt service and revenue will be corrected, apart from rebalancing our borrowings in favour of longer tenure loans and external sources, is by finally and frontally facing the issue of revenue.
In her speech, she emphasised the limitation of relying on oil “We believe that Nigeria is an ‘oil-plus’ economy and we should model ourselves after countries that have similar profiles like Egypt with a population of 91 Million and 490,000 barrels of oil per day (185 people to a barrel of oil) and has a highly diversified revenue base.
She further explained that we cannot model ourselves after Saudi Arabia, with their 30 Million population and 10 Million barrels of oil per day (3 people to a barrel of oil). In Nigeria, we have a population of close to 180 Million people and about 2 Million barrels of oil per day (90 people to a barrel of oil). We must therefore, diversify our revenue base.
Adeosun stated that revenue mobilisation, is therefore, critical to our success. “Revenue mobilisation is critical to the success of Nigeria’s economic reform agenda and we are working on strategies to drive non-oil revenue growth, she said”. To do this, we must amend Nigeria’s low level of tax compliance. A tax to GDP ratio of just 6%, is just too low and we are working to amend this.
It could be recalled that on Thursday the Ministry of Finance, announced plans to recruit and train 7,500 Community Tax Liaison Officers under the N-Power scheme. “These young people will be subjected to a rigorous and intensive education on the tax system, sales, communication skills and civic education before being deployed to their communities to provide tax education and enrol new tax payers”, she said. We have just 14 Million tax payers out of an estimated 69.9 Million people who are economically active.
Nigeria is doing more with less and we will continue to do so. Growth is returning, investor confidence is reawakening and that confidence is based on an economic blueprint, which if followed doggedly, would take us from the rough road, onto a path of sustainable and inclusive growth.
Other speakers at the Round Table included Dr. Doyin Salami of Lagos Business School, Mr. Andrew Alli, the President/Chief Executive Officer, Africa Finance Corporation and Mr. Oscar Onyema, the Chief Executive Officer, Nigerian Stock Exchange, among others.
FG confirms first payments to Whistleblowers
The Federal Ministry of Finance has confirmed release of N375.8M to the first batch of 20 providers of information under the Whistleblower Policy. The payment, of various amounts totaling N375,875,000, relate to the recovery of N11,635,000,000.
The Minister for Finance, Mrs. Kemi Adeosun stated: “This payment, which is the first under the Whistleblower Policy, underscores the commitment of the President Muhmmadu Buhari-led administration in meeting obligations to information providers under the Whistleblower Policy. The policy is an essential tool in the fight against corruption.”
She further disclosed recent amendments to the Whistleblower Policy which includes the introduction of a formal legal agreement between information providers and the Federal Government, which is executed by the Minister of Justice (Attorney-General of the Federation). Procedures have also been introduced to ensure the protection of the identity of information providers during the payment process.
The Minister explained that all payments are taxable and are only made upon confirmation of the final recovery of assets as confirmed by the Attorney-General of the Federation as being free of legal disputes or litigation.
The Minister also gave details of the Whistleblower Unit (WBU), a multi-agency team, which is resident in Ministry of Finance Headquarters. It is staffed by secondees from the Economic and Financial Crimes Commission (EFCC), the Independent Corrupt Practices and Other Related Offences Commission (ICPC), Department of State Services (DSS), the Nigeria Police Force and Presidential Initiative on Continuous Audit (PICA), among others. “The Whistleblower Unit is the first line of response to whistleblower information, where initial review is undertaken before cases are forwarded to the relevant investigative agencies,” Mrs. Adeosun said.
It could be recalled that the Ministry of Finance has reported that following the approval of the Whistleblowers Policy by the Federal Executive Council and its launch by the Minister of Finance in December 2016, the WBU received 2, 150 communications and 337 tips through its dedicated channels from many patriotic Nigerians, which led to the recovery of substantial assets that were illegally acquired by various individuals. The primary purpose of the Policy is to support the fight against financial crimes and corruption, promote accountability and enhance transparency in the management of public finances.
Mrs. Adeosun assured that the administration of President Muhammadu Buhari would continue to encourage all Nigerians with information on misconduct, violation or improper activity which can impact negatively on Nigeria to report it to the appropriate authority.
FG INAUGURATED COMMITTEE ON PENSION LIABILITIES
An inter-ministerial committee to review all pension liabilities of the Federal Government and come up with strategies to offset such liabilities has been inaugurated by the Minister of Finance, Mrs. Kemi Adeosun, who chairs the Committee.
The Minister said while inaugurating the Committee that the Terms of Reference of the Committee were to review and reconcile all pension liabilities of the Federal Government; make recommendations as to what portion of the liabilities can be funded through budgetary appropriations: and suggest creative ways of funding the balance.
Mrs. Adeosun tasked members of the Committee to equally identify any pension assets that could be in suspense and ensure that such monies are used in offsetting the liabilities and set up a mechanism that will facilitate regular payment of pensions through budgetary allocations and other creative ways.
The Minister lamented the situation of pensioners who were not paid their entitlements and vowed that the Committee would ensure that it creates a mechanism through which pensioners would be paid their entitlements as and when due.
Members of the Committee include the Accountant-General of the Federation, the Executive Secretary, Pension Transitional Arrangement Department, Acting Director-General of the National Pension Commission and the Director-General of the Budget Office of the Federation. The Office of the Secretary to the Government of the Federation and the Office of the Head of the Civil Service of the Federation are also represented on the Committee.
It could be recalled President Muhammadu Buhari approved the constitution of the inter-ministerial committee to reconcile outstanding pension liabilities due to civil servants and offer solutions to the lingering problems in the pension system.
FGN ASSETS: Minister of Finance Urges MDAs to submit records faster
The Minister of Finance, Mrs. Kemi Adeosun, has urged all Federal Ministries, Departments and Agencies, including Nigeria’s Diplomatic Missions and posts and tertiary institutions to speed up the compilation and submission of the inventory of their assets held as at 31st December, 2016 to facilitate the registration of such assets.
The Minister said in a Government Circular issued to all MDAs on 23rd May 2017, that the assets registration was part of the determination of the administration of President Muhammadu Buhari to achieve greater accountability and transparency in the utilization of resources in line with the adoption of the International Public Sector Accounting Standards (IPSAS) by the Government.
She referred to a letter No. FMF/F & A/ ATMP/C1 of 7th March 2016, sent to all Federal MDAs in which they were requested to submit the inventory of their assets to the Ministry, but noted that the Ministry was yet to receive the submissions and emphasised that:”This delay is counterproductive to the objectives of this initiative. In that regard, may I kindly request submission within the next 14 days.”
The Circular, which was addressed to the Chief of Staff to the President, the Deputy Chief of Staff in the Office of the Vice President, all Ministers of the Republic, Federal Permanent Secretaries, Director-Generals, Chairmen of all Commissions, Clerk to the National Assembly, Vice-Chancellors of Federal Universities, the Executive Secretary, National Judicial Council, All Service Chiefs, the Head of the Civil Service of the Federation, the Secretary to the Government of the Federation, the Accountant-General of the Federation, Rectors and Provosts of Federal Polytechnics and Colleges of Education among others, said that all assets acquired between January 2012 and December 2016 are to be fully documented and forwarded to the Project Coordinator/Director, Finance and Accounts Department, Federal Ministry of Finance, Abuja.
The Circular clarified further that even assets that were disposed off within the period should be included in the inventory alongside the “evidence of the disposal procedure in detail as well as receipts of payments for such sales undertaken.”
It is recalled that on 3rd March 2017, the Federal Government through a News Release issued by the Ministry of Finance announced the launching of an Asset Tracking and Management Project (ATMProject), through which the Government would be able to locate, identify, assess and evaluate all its moveable and immoveable assets held by MDAs in the country and abroad.
Similarly, a Central Asset Register would be created and domiciled in the Federal Ministry of Finance for recording the actual quantity, value, condition and location of all the capital assets belonging to the Federal Government.
“For the first time since independence, a central and Unified National Database of Assets would be generated and maintained for the purpose of recording, tracking and managing the huge investments in capital assets used by Government for the delivery of goods and services to the citizenry,” the Minister explained.
The News Release at the time cited a Circular addressed to all MDAs in the country requesting them “to ensure that any assets held by current and former staff are fully accounted for. In this regard, you may find it necessary to contact any former staff and /or political office holders to avail them the opportunity to return relevant assets in their possession.”
The circular emphasised that “all inventory records submitted will be cross-checked to capital releases and project account purchases to ensure completeness. Where assets have been sold or otherwise disposed of, they must be recorded with supporting authorization for sale and evidence of payment, where applicable.”
The Circular drew the attention of Heads of MDAs to Chapter 26 of the Financial Regulations, with regards to disposals of assets and warned that “any asset not accessible for physical inspection and not disposed of in accordance with financial requirements will be deemed to have been illegally withheld or converted. Please record such assets so as to enable the investigative agencies to be notified.”
FEC APPROVES US$250m SOFT LOAN TO PROVIDE BASIC SERVICES TO 14 MILLION PEOPLE
The Federal Executive Council on Wednesday approved a US$150 million soft loan from African Development Bank (AfDB) and US$100 million from African Development Finance (ADF) for Rural Water Supply and Sanitation Initiative (RWSSI) as well as a Grant of five million Euro to finance Inclusive Basic Service Delivery and Livelihood Empowerment Integrated Programme in five states of the North East.
The approval followed a memo presented to the Council by the Minister of Finance, Mrs. Kemi Adeosun, who explained that the money would facilitate in improving the quality of life of 14 million people and over 2.3 million internally displaced persons affected by the Boko Haram insurgency by increasing their access to basic social services in the areas of potable water supply, sanitation, health care delivery and education.
Other areas covered by the programme are entrepreneurship development, job creation and livelihoods for youth, women and the vulnerable, social cohesion and physiological support.
It could be recalled that in its social inclusion agenda, the Federal Government has launched a programme for rebuilding and reconstruction for peace and development in the North East, and sought support from the African Development Bank to achieve the goal.
The multi-sectoral programme will be implemented in Adamawa, Borno, Gombe, Bauchi and Taraba States within a span of five years starting from 2017 to December 2021, while Yobe State has already started implementing a similar programme.
The loan would be repayable in 25 years with on a highly concessional interest rate. The five beneficiary states will make a counterpart funding of 6.1 per cent.