FG Executive Order To Agencies On Transparency In Budgeting Process Will Aid Openness In Extractive Sector

In an effort to improve openness and transparency in the budgeting process, the Federal Government of Nigeria has issued Executive Order directing all Agencies,

FG Executive Order To Agencies On Transparency In Budgeting Process Will Aid Openness In Extractive Sector

In an effort to improve openness and transparency in the budgeting process, the Federal Government of Nigeria has issued Executive Order directing all Agencies, whether or not listed in the Fiscal Responsibility Act, to prepare and submit their budgets and revenue to the Minister of Finance and the Minister of Budget and National Planning before the end of May every year for the next three financial years.

The government further directed that a joint committee of the Ministries of Finance, and the Budget and National Planning shall review all budget estimates and ensure they conform with the national plan, financial and budgetary regulations before processing them for approval and transmission to the National Assembly.

In what appears to be a pragmatic state response to curb corruption in the budgeting process, the government has made it mandatory for all supervising Ministers, Heads of Agencies as well as the Chief Executive Officers of Government-owned companies to verify that the process of preparation, harmonization, and collation of budget estimates are as stipulated in relevant laws and guidelines as well as ensure strict compliance with this Executive Order.

Having identified procurement and contract inflation as means of diverting public monies, and the state determined to address this trend, the government has directed that except with the express consent of the President, no payment shall be made in respect of any capital or recurrent liability of an Agency, other than payment of due salaries and allowances. Unless the Agency has an approved budget and the payment is in conformity with the approval.

In order to make sure the Execute Oder is carried out, the state has instructed that all Heads of Agencies and Chief Executive Officers of Government-owned companies must take personal responsibility and be subject to appropriate sanctions for failure to comply with the Order.

Any revenue or other funds of an Agency in excess of the amounts budgeted and duly expended shall accrue to the consolidated revenue fund of the Federal Government. The government said.

Signed by Mr. Yemi Osinbajo, the Acting President, on the 18th day of May 2017, the state directed that the Executive Order takes effect immediately.

At the Publish What You Pay-Nigeria and other NGOs working in the extractive sector transparency, this is a huge success we can leverage on to push for absolute transparency in the extractive sector, particularly in the oil and gas.

Extractive sector (the oil and gas) for a number of reasons has internalized corruption and lack of transparency as part of the operational process and mechanism.

For instance, in order to ensure corruption and lack of transparency persist in the extractive sector operation, the Nigerian National Petroleum Corporation (NNPC) does not open its budget and expenditure for public scrutiny. In short, it considers its budget a classical document that must not be accessed. Their total disregard to Freedom of Information Requests, further confirms the corporation determination to remain inaccessible. This is even as NNPC is running overhead budget bigger than the Federal Government and has refused to be accountable to anybody, government inclusive.

This practice seems to persist no matter the government reform because, there is an inbuilt attitude not to be open and transparent, and that has been in the interests of both the government and oil companies.

If they are not transparent, government officials and oil companies get more illicit funds, pay less tax, and destroy more of the environment. It has been beneficial to everybody for not being transparent in their operations.

With this Executive Order and the punitive sanctioned that follows for the purposes of those that will want to circumvent it, we are beginning to see state response to addressing the corruption and lack of transparency that has characterized the extractive sector over the years.

 

Audu Liberty Oseni

Communication Officer, Publish What You Pay-Nigeria

Abuja Secretariat