ICPC alleges budget manipulation in federal MDAs - AFRICAN PARLIAMENTARY NEWS



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Thursday, February 18, 2021

ICPC alleges budget manipulation in federal MDAs

The Independent Corrupt Practices and Other Related Offences Commission (ICPC) on Wednesday said it has uncovered deep-seated corruption bordering on budget manipulation by various Ministries, Departments and Agencies (MDAs).

This was disclosed in Abuja by the ICPC Chairman Prof Bolaji Owasanoye, at the Budget Office/ICPC Interactive Forum with Directors of Finance and Accounts and Directors of Internal Audit.

Owasanoye stated that the different layers of fraud have led to revenue haemorrhage as the workers continually shortchange the system.

He also disclosed that the Commission detected the infractions during a System Study Review of Budget Implementation.

‘There was budget manipulation by most MDAs which resulted in MDAs receiving both appropriation and releases beyond their actual needs. While these surpluses were open to the risk of being misappropriated as is tradition,’ he said.

‘In 2019, ICPC reviewed 208 agencies of government that are funded from the Federal Treasury and came up with outstanding results which included the discovery of N31.8 billion personnel cost surpluses for 2017 and 2018, and misapplication of N19.8 billion and N9.2 billion from Personnel Cost and Capital Fund, respectively.’

As a result of the discoveries, Owasanoye said that N42 billion unspent surplus allocations for Personnel Cost for 2019 alone were blocked from possible abuse and pilfering mostly from health and some educational institutions.

The ICPC boss expressed worry that despite reminding erring MDAs with federal circulars prohibiting such practices, the infractions have continued, thus requiring stronger measures on the part of the government and anti-corruption agencies to stem the tide.

The ICPC boss said based on the review, the agency discovered padding of nominal rolls including the inclusion of outsourced staff; warrant releases in excess of actual personnel cost needs; inadequate budgetary overhead allocation; and inadequate or non-budgetary allocation for outsourced services.

Owasanoye further revealed that there were the issues of REMITA payment system not allowing for the matching of account numbers with account names and thus making fraud easy; inordinate balance staffing levels between Teaching Hospitals and Federal Medical Centres.

He said the ICPC discovered the payment of advances beyond the approved limit of N200,000 to individuals’ accounts; advances for projects paid into project accountants’ personal accounts with commercial banks; and payments to individual staff/accountants for disbursement to ad-hoc employees/outsourced services and other employees

The ICPC Chairman explained that there was a payment to project officers/accountants to pay casual/onsite employees who are employed for short periods and cannot be registered on the platform; while cash was made for staff Duty Tour Allowance, Transport, collation of results and the like for personnel of paramilitary services under the Ministry of Interior for promotion exercise.

To address these challenges, he called on the Federal Government to stop the late release of budgetary allocation especially at the end of the year to check fraud and corrupt practices by Ministries Departments and Agencies of government.

He said that the practice where funds are released at the end of the year for the execution of projects raises the opportunity for frenzied expenditure, circumvention of procedure, fraud and corruption.

He said: ‘MDAs should be advised to issue financial reports on time to enable completion of annual audit and publishing of results on time. Sanctions should be introduced for inordinate delays.

‘Government should avoid late releases of budget allocation, especially at the end of the year as the practice raises the opportunity for frenzied expenditure, circumvention of procedure, fraud and corruption.

‘Appropriated funds should be released in time to allow for strict compliance with the procurement procedure. Otherwise deferred till the following fiscal year as the government is a continuum.’

He also recommended that unspent balances should be blocked and restrained/reversed immediately salaries are paid to prevent misuse.

The ICPC boss also said there is a need to prevent unauthorised editing of payroll information data on the Government Integrated Financial Management Information System platform for MDAs until after payment has been concluded by granting them view-only status.

He added that prevention of inflation of nominal rolls by MDAs for the 2021 budget and beyond was vital to eliminate surplus allocation and releases, and other resultant infractions.

He called on the Federal Government to withdraw MDAs’ access to non-regular, pension and National Housing Insurance Scheme lines on GIFMIS and restrict the same to IPPIS staff.

To eliminate any fraudulent payments, Owasanoye called on the Federal Government to direct the application of the Bank Verification Number as a requirement in populating the Personnel Cost Budget Template and IPPIS data.

He also urged the government to carry out a reform of the REMITA payment system to provide matching of the account name with a number for all payments.

He said banks should be directed to ensure that account names and numbers match before completing payment.

In the area of personnel, he advised that a staff audit should be conducted especially for educational and health institutions in order to establish actual staffing and staffing needs based on the volume of work and appropriately right-size for cost efficiency.

He added that MDAs should be advised to issue financial reports on time to enable completion of annual audit and publishing of result on time, noting that sanctions should be introduced for inordinate delays.

He said ‘the infractions established to constitute the risks and building blocks for the inefficient public expenditure and pervasive corruption that bedevil our public finance.

‘The continuity of these infractions challenges our professed political will to deal with impunity characterised by the disobedience of laws and regulations.

‘This is an existential threat to the nation and it has already negatively impacted stability and development because funds appropriated for major infrastructure and development projects are simply diverted or mismanaged the same way thus diminishing the hope of the people and the plans and programs of government.

‘It starts with those of us in this room. This impunity cannot continue ad-infinitum. Nigeria cannot and will not survive it.

‘We are at a turning point with a global pandemic whose end is uncertain, reduced public revenue but escalating citizen expectation, youth restiveness, insecurity and lack of or decaying critical infrastructure.

‘In all of this government is striving to put money in the right place for the benefit of the people.’


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