The Oil and Gas Free Zones Authority, OGFZA, says it has developed a financial framework that would enable it fund recurrent expenditure from its internally generated revenue, IGR, beginning from 2018.
The managing director of OGFZA, Okon Umana, said the agency had on December 6, 2017 written to the Federal Ministry of Finance to formally inform it of its readiness to pay its staff salaries and overheads from its IGR.
Mr. Umana, who was addressing members of the Senate Committee on Trade and Investment, requested the “Federal Government to suspend the funding of the recurrent expenditure of OGFZA from treasury funds” from 2018 financial year.
“Financial independence that permits self-funding of our operations is one of the six goals that OGFZA set for itself under my management in our three-year roadmap which became operational at the beginning of last year,” Mr. Umana told the committee during its 2018 budget defence session.
The OGFZA boss said financial independence was part of the highlights of the agency’s roadmap to kick-start a series of reforms on the operations of the Authority, particularly by adopting measures to boost its IGR, capacity.
Mr. Umana said the new management of OGFZA had written to the Minister of Finance, Kemi Adeosun, to inform her of the plan not to depend on the federal treasury for funding to meet its recurrent expenditure requirements, including salaries and overheads with effect from the 2018 financial year.
“The recurrent expenditure of the Authority will henceforth be funded with our IGR,” Mr. Umana said.
A member of the Senate committee, Nelson Effiong, expressed satisfaction with OGFZA’s performance under Mr. Umana’s leadership, describing it as unique and worthy of emulation by other agencies of the federal government.
Mr. Effiong noted that OGFZA’s resourcefulness contrasted it sharply with the case of other government agencies which rely solely on handouts from the federal government to fund both their recurrent and capital expenditures.
He commended the leadership of OGFZA for the capacity to raise enough internally generated revenue to take care of its recurrent expenditure.