BY VICTORIA ONU, ABUJA
The Federal Government has raised the independent revenue projections from Ministries, Departments and Agencies in the 2022 fiscal period from the 2021 figure of N2.17trn to N2.37trn. The figure represents an increase of N204bn over the N2.17trn in 2021.
The N2.37trn independent revenue is contained in the 2021-2023 Medium Term Expenditure Framework, which was obtained from the Ministry of Finance.
Out of the estimated revenue projections, a huge chunk is being planned to be realised from 10 of these agencies.
Some of these top agencies, according to findings, are the Central Bank of Nigeria, the Nigerian Insurance Deposit Corporation, National Maritime Administration and Safety Agency, and Nigerian Communications Commission.
The upward revision of the revenue projection by the Federal Government was caused by the reopening of the economy, following the negative impact of the Coronavirus pandemic.
The pandemic had led to unprecedented drop in global crude oil prices.
The drop in crude oil price had led to dwindling revenue inflow into the federation account.
Faced with the threat of persistent decline in revenue inflow, it was learnt that the government decided to raise the initial projection from operating surplus remittance by N204bn.
About 122 agencies are required to pay the operating surpluses into the Consolidated Revenue Fund of the Federal Government, based on the Fiscal Responsibility Act, 2007.
The Act requires listed government agencies to remit 80 per cent of their annual operating surpluses to the CRF.
The operating surplus is made up of revenues accruing to government agencies above what they are approved to spend at the beginning of the budget year.
Some of these agencies are the Petroleum Products Pricing Regulatory Agency, Central Bank of Nigeria, Nigeria Ports Authority, and Federal Airport Authority of Nigeria. Nigeria Postal Service, Nigeria Communication Commission, National Inland Water Ways Authority, and National Information Technology and Development Agency.
There is also the Nigeria Airspace Management Agency, National Examination Council, Nigeria Television Authority, Nigeria Shippers Council, National Health Insurance Scheme, National Pension Commission, Corporate Affairs Commission and Standard Organization of Nigeria, among others.
But over the years, many of these agencies have been underpaying revenue into the coffers of government.
Only recently, the Federal Government had discovered that about 50 government owned enterprises that generate independent revenue did not remit their operating surpluses running into over N2trn.
Speaking on the development, the Lead Director, Centre for Social Justice, Eze Onyekpere, said that government revenue projections over the years had not been based on realistic assumptions.
He said, “Generally, our revenue projections have severally missed the mark over the years.
“The projections and forecasts suffer from lack of realism. In 2016, revenue projections fell short by 23 per cent; in 2017, it fell short by 47.73 per cent, and in 2018, by 45 per cent.
“Faced with the threat of persistent decline in revenue inflow, it was learnt that the government decided to raise the initial projection from operating surplus remittance by N204bn”
“This indicates that overall, a good part of our revenue projections has not been based on empirical evidence.”
He said the revenue projections for 2020 should have been greatly influenced by the trend and actual of 2018 and 2019 except there had been a dramatic change in economic circumstances warranting the new projection.
In his comments, the Registrar, Institute of Finance and Control of Nigeria, Godwin Eohoi, said in order to achieve the revenue target, key reforms should be implemented with increased vigour to improve revenue collection and expenditure management.
He said achieving fiscal sustainability required decisive actions, noting that the budget performance had shown clearly that the country had revenue challenge.
He gave some of the reforms initiatives that should be undertaken to include deployment of new technology to improve collection, stronger enforcement action against tax defaulters and tighter performance management framework.
The Director-General, Budget Office of the Federation, Ben Akabueze, had, during a meeting with the heads of the revenue generating agencies, said the Federal Government would strengthen its control mechanism to make the revenue process more transparent and inclusive.
To achieve this, Akabueze said the government would implement tight expenditure control to limit allowable expenses, frequency of board meetings and other wasteful practices.
