DESPITE the existence of the Fiscal Responsibility Act of 2007, the nation's dream of enthroning a regime of prudent, ethical and effective management of public funds and resources across all arms and tiers of government in the Federation might not be realised anytime soon.
Reason: The Fiscal Responsibility Commission (FRC) yesterday disclosed that it was battling to enforce the Act with minimal results owing to several loopholes in the Act, which stakeholders are exploiting.
Chairman of the Commission, Dr. Aliyu Jibril Yelwa, stated this in Abuja at a Town Hall meeting on the 2012 budget organised by a non-government organization, ActionAid.
Participants were drawn from government agencies, organised private sector, labour unions, the media, civil societies and professional associations.
Minister of Finance, Dr. Ngozi Okonjo-Iweala, who was expected to discuss the major thrusts of the 2012 budget at the Town Hall meeting, did not attend the event.
Okonjo-Iweala championed the promulgation of the Act at her first coming as Finance Minister in the President Olusegun Obasanjo era.
Yelwa observed that states and local councils were having a field day exploiting the Act by refusing to domesticate it and subject their processes to fiscal responsibility scrutiny.
He described the Commission as "a police without gun sent to put down riot and arrest offenders."
Yelwa stressed the need for more effective mainstreaming of fiscal responsibility into the budget process.
He told the visibly bewildered gathering: "The Federal Responsibility Act 2007 provides for offences, but does not specify punishment. Worse still, requiring the Fiscal Responsibility Commission to report contraventions to the Attorney-General for possible prosecution in Section 2 (2) of the FRA 2007 is not likely to help. In the circumstance, officers and government agencies contravene the FRA 2007 with impunity.
"In Nigeria, we practise 'broken budget'. Budgets are prepared late, approved late and implemented late. For example, for the past seven years, budget approvals came over three months after the commencement of the budget years. The budgets often deviated from the MTEF, and the legislature, through amendments and supplements, vary the budgets beyond plus or minus five per cent. Of course, the execution of the capital budget was often extended three months into the following financial year."
However, Yelwa stated that the challenges were not insurmountable but that they could only be tackled with a greater sense of commitment and purpose.
According to him, the Act should be amended to provide for punishments in the form of fines, recovery of assets unjustly acquired, imprisonment and ban from holding public office for a reasonable length of time for its violators as obtainable in Brazil.
His words: "The FRC should be empowered to prosecute offenders under the FRA 2007 without necessarily reporting them to the Attorney-General of the Federation for possible prosecution. This empowerment will considerably compel compliance with fiscal responsibility.
"Leaving sub-national governments, which control over 50 per cent of the national resources out of the purview of fiscal responsibility, is obviously counterproductive."
Yelwa also wants the state and national budgets to be approved and signed into law a month or two before the start of the financial year.
"This is the international practice in places like Canada and Switzerland, and it makes for full execution of the budget within the financial year," he added.
The Guardian