CSOs laud NASS’ resolve to amend fiscal responsibility law to check corruption

Kauthar KhaleelNovember 27, 20234 min

The CSOs have been advocating for an amendment of the FRA 2007 to bring about enduring solutions to the public finance management challenges plaguing the country.

The recent resolve by the National Assembly to commence the process of reviewing the Fiscal Responsibility Act (FRA) 2007 has drawn commendation from a cluster of civil society organisations (CSOs) led by OrderPaper Advocacy Initiative and the Growth Initiatives for Fiscal Transparency (GIFT).

The amendment is targeted to empower the Fiscal Responsibility Commission (FRC) to enforce the provisions of the law through sanctions on erring ministries, departments, and agencies (MDAs), especially concerning lack of compliance with financial reporting standards, reckless misapplication of internally generated revenues (IGRs) and non-observance of due process in public borrowing.

The group also lauded the legislature over its decision to review laws governing revenue-generating agencies in order to check wastage and increase revenue generation.

In a statement signed by the Executive Director of OrderPaper, Oke Epia, and Executive Director of Centre for Transparency Advocacy (CTA), Faith Nwadishi, the group said the latest move by the legislature aligns with its objective and recent public and stakeholder engagement efforts on needed policy reforms in public finance management.

Recall that both chambers of the National Assembly last week adopted the report of the Joint Committees on Finance, Appropriations, National Planning/Economic Affairs, and Local and Foreign Debts.

In approving the 2024-2026 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) submitted by President Tinubu, the National Assembly harped on the amendment of the FRA 2007 as one of the measures to check corruption, block revenue leakages and waste of scarce public resources.

READ ALSO: GIFT: CSOs decry Nigeria’s huge debt, deepen advocacy for fiscal reforms 

After outlining its findings, the joint committee recommended, among others, that “the National Assembly commence the process of amending the FRA to enhance the agency’s ability to enforce fiscal responsibility and impose sanctions on erring corporations specifically, with regards to Sections 21 (1) and 22 (1) (2)”.

While noting that “a significant number of the federal government’s revenue-generating agencies engaged in arbitrary, frivolous and extra-budgetary expenditure,” the National Assembly joint committees observed that “most of the revenue agencies violate the FRA due to the lack of punitive measures in the Act.”

According to the report, some revenue-generating agencies, without recourse to the National Assembly have been involved in joint venture agreements particularly, in the oil and gas as well as power sectors, which has not only committed the Federal Government to a $40 million monthly take or pay agreement but subjects Nigeria to huge international arbitrations.

It added that the agreements have exposed Nigeria to an estimated N19.9 trillion in contingent liabilities between 2024 and 2026. Hence, the National Assembly joint committees also recommended to plenary to “review the laws governing the activities of all such revenue-generating under their purview to identify specific sections of clauses that need to be amended to plug waste and increase the government’s capacity to generate revenue”.

In the statement, the cluster further urged the lawmakers to see through the FRA amendment to bolster the efforts of President Bola Tinubu’s administration to reform the country’s public finance architecture.

The statement read: “We believe that the amendment of the FRA will, amongst other things, address the issues of accountability, transparency, and lack of prudence in public finance, and also empower the Fiscal Responsibility Commission to stand up to its responsibility in checking wanton disregard for the provisions of the law by MDAs of the Federal Government.

“Through our GIFT Nigeria project, designed to catalyze reforms around Transparency, Accountability, and Good Governance (TAGG) vis-à-vis Public Finance Management (PFM) and supported by the United States Agency for International Development (USAID) under the Strengthening Civic Advocacy and Local Engagement (SCALE) project by Palladium, we have advocated vigorously for an amendment of the FRA 2007 to bring about enduring solutions to the public finance management challenges plaguing the country.

“We, however, urge the 10th National Assembly to go beyond the mere expression of commitment to achieve the desired objective of amending the FRA, unlike its predecessor, which failed to pass the amendment bill after several efforts by stakeholders, including the GIFT cluster and civil society organisations to make it do so.”

Kauthar Khaleel

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