Group asks Nigerian government to halt scrapping of Fiscal Responsibility Commission

“The FRC is central to the country’s quest for improvements in fiscal governance.”

The Centre for Social Justice, CSJ, on Wednesday asked the Federal Government to stop the proposed scrapping of the Fiscal Responsibility Commission, FRC.

The Presidential Committee on the Rationalisation and Restructuring of Federal Parastatals, Commissions and agencies, led by the former Head of the Civil Service of the Federation, Steve Oronsaye, had recommended that the agency be scrapped along with 219 of 541 government agencies.

A government White Paper on the committee’s report accepted the recommendation that the powers and duties of the FRC be transferred to the Revenue Mobilization Allocation and Fiscal Commission, RMAFC and the National Salaries, Income and Wages Commission.

But the Lead Director of CSJ, Eze Onyekpere, said in Abuja on Wednesday that the recommendation, if implemented by the Federal Government, would negate efforts at entrenching national and international standards in public finance management practices in the country.

Mr. Onyekpere said the task of enhancing accountability and transparency should not be left to politicians, who, he said, do not have a track record and desire for change in the way public accounts are handled by officials.

Noting that fears were expressed that government had created the FRC more out of the prompting for donor agencies’ financing, than a conviction and concern for accountability and financial prudence, Mr. Onyekpere urged the Minister of Finance, Ngozi Okonjo-Iweala, to ensure that this was not the case, as it would mark the lowest point of her management of the country’s economy.

He noted that since the mandate of the Oronsaye Committee largely focused on cost reduction, it should have paid more attention to core areas of waste the Federal Government should plug, like the implementation of the monetization programme.

“It is not enough for the administration to claim that monetization policy has no legal foundation, as government is a continuum. The current administration should not seek to dismantle the reforms of previous administrations without providing cogent replacements. No administration that is committed to reducing the cost of governance would dispose of the monetization programme,” he said.

The CSJ lead director averred that since the Committee had identified about 50 agencies with no enabling laws that established them, government should start the scrapping process with those, including the ‘slush fund it calls service wide votes.’

Scrapping the FRC, Mr. Onyekpere said, would be counter-productive to the effort to prune down the cost of governance, considering the achievements of the agency within five years of its existence.

Though the FRC did not get cumulative budgetary allocation of more than N3.74 billion for the period, Mr. Onyekpere said it had, however, ensured that scheduled corporations paid to government finance, surpluses of about N17.097 billion in 2009; N36.766 billion in 2010; N71.06 billion in 2011, and N95.366 billion in 2012.

He said FRC’s counterparts around the world, including in India, Brazil and Mexico, do not have mandates that are mixed up with politics.

He pointed out that scrapping the FRC and transferring its functions to the RMAFC, whose primary political functions were not centered on fiscal governance, would leave the Fiscal Responsibility Act, FRA, without a sound body to oversee its implementation on daily basis.

With RMAFC currently composed of a Chairman, 37 representatives from each of the 36 states and the Federal Capital Territory, FCT, who are more of politicians than core technocrats, he said bringing FRC under it would amount to sacrificing fiscal responsibility for the politics of revenue mobilization and allocation.

He said with several states of the federation already enacting the Fiscal Responsibility law in their domains, and many others in the process of doing same, scrapping the FRC would send a wrong signal to the states on the issue of fiscal responsibility.

Scrapping the FRC, Mr. Onyekpere said, would not only portray the country as lacking in commitment to fiscal transparency in international circles, but also retrogressive in its pursuit of the practice.

With RMAFC mandated to determine the remuneration of political office holders, he said the addition of FRC’s mandate would create a confused omnibus organization that would not be able to focus on its core mandate of monitoring and enforcing compliance to fiscal responsibility standards.

Scrapping the FRC, Mr. Onyekpere noted, would confirm government’s inconsistency and policy reversals that have retarded national growth and hindered development towards the realization of the Vision 20:2020 objectives.

“The FRC is central to the country’s quest for improvements in fiscal governance. It would be a dangerous mistake to scrap it and pretend that RMAFC is in a position to oversee the implementation of the FRA,” he added.