The Finance Ministry is yet to comply with the provisions of the Fiscal Responsibility Act, FRA, 2007 requiring that an Annual Cash Plan be established for effective implementation of the Appropriation Act, a new benchmarking report by the Nigeria Natural Resource Charter, NNRC, revealed.
Sections 25-28 of the FRA highlight specific requirements, which include the need for the Finance Minister, through the Office of the Accountant General of the Federation, draw up the plan for each financial year.
Also, the Act says the plan shall be prepared in advance of the financial year, by setting out projected monthly cash flows, subject to periodic revisions to reflect actual cash flows.
Besides, it directs the Finance Minister to set the time frame for funds’ disbursement, by ensuring that within 30 days of the Appropriation Act enactment, a disbursement schedule, derived from the annual cash plan, is prepared and published for the purpose of implementing the Act.
If after 90 days of the enactment of the Appropriation Act, it is found that revenue targets may be inadequate to fund approved expenses, the Act mandates the Minister to, within the next 30 days, restrict further financial commitments in accordance with set Fiscal Risk Appendix criteria.
“These stipulations are yet to be adhered to, as the Ministry of Finance has failed to produce an Annual Cash Plan, Budget Disbursement Schedule and Fiscal Risk Appendix,” the NNRC noted in its latest 2017 report.
In 2013, the Centre for Social Justice, CENSOJ, sued the Federal Government, seeking to compel the minister to comply with the FRA provisions.
Fidelis Onyejebu of CENSOJ told PREMIUM TIMES, there has not been any evidence to show that since the suit, No. FHC/ABJ/CS/251/2013, “either the Annual Cash Plan, the Budget Disbursement Schedule or the Fiscal Risk Appendix has been prepared or produced.”
The minister, Kemi Adeosun, did not answer calls placed by PREMIUM TIMES to her telephone on Friday seeking her clarification on why the ministry has not complied with the FRA provisions. The minister did not also respond to text messages sent to her over the issue.
At the presentation of summary of the 2017 Benchmarking Exercise report to a select group of civil society in Abuja, the NNRC said its findings reflected changes in Nigeria’s oil and gas resources management since 2014.
The report also assesses Nigeria’s performance in the management of its petroleum wealth against the expectations of the 12 principles of good practice for optimising the socio-economic benefits of natural resources, as set out in the Natural Resource Charter, NRC, framework.
Reviewing changes in sector governance between benchmarking exercises, PREMIUM TIMES learnt that a consortium of researchers consulted with multiple stakeholders in the oil and gas sector, including industry experts, practitioners, civil society organizations and community leaders.
To translate its resource wealth to long-term sustainable growth, while avoiding pitfalls that come with it, the experts urged resource-rich developing countries to adhere to its precepts, which provide a benchmark for measuring progress in the country’s oil and gas sector.
The report highlights the state of the Nigerian petroleum governance, and identifies crucial policy changes made since the second assessment was conducted in 2014. It also takes a look at the main strengths and weaknesses of Nigeria’s petroleum sector governance as well as reform priorities and opportunities.
NNRC Programme Coordinator, Tengi George-Ikoli, said the final report would be presented to the public in the first quarter of 2018.
The NNRC, a multi-stakeholder group of experts, policy makers and civil society groups focused on promoting good practices for optimising socio-economic benefits of natural resources in resource-rich nations has former Minister of State for Energy, Odein Ajumogobia, as chair of its experts’ advisory panel.
Other members of the panel include former chairman of the Governing Board of the Nigerian Extractive Industry Transparency Initiative, NEITI, Assisi Asobie, as co-chair, and former Vice President of the World Bank in Africa, Oby Ezekwesili.