By Bassey Udo September 28, 2010 05:32AM

The federal government yesterday said it has commenced the auditing of all revenue generating agencies in the country as well as the forensic audit of the Nigerian National Petroleum Corporation (NNPC), as part of the present administration’s effort to restore discipline in the management of public finances.

Minister of Finance, Segun Aganga, who disclosed this at the inauguration of the Expenditure Review Committee in Abuja yesterday, said other steps taken by government include: strengthening the process for the inspection of exports, including crude oil; introducing e-payment for the Nigerian Customs Service (NCS) as well as establishing the Asset & Liability Sovereign Risk management desk.

Financial discipline

He said the government is accelerating the implementation of key public financial management reforms aimed at enshrining greater discipline in the management of public finances, improving the quality and efficiency of government’s spending, and optimising the allocation of resources through the Annual Federal Budget.

According to him, as part of government’s public finance management reforms, his ministry and the National Economic Management team (NEMT) had adopted a strategy to refocus the country’s economy to deliver enhanced economic growth, fast-track institutional reforms and implement fiscal/budget reform.

The bill establishing the Nigerian Sovereign Wealth Fund, he said, would be submitted to the National Assembly next week, pointing out that when passed into law, it will serve as a catalyst for domestic and international investors to participate in the effort to reduce the country’s infrastructure deficit as well as form part of the fiscal policy.

Part of the success story, he said is the implementation of the Integrated Personnel and Payroll Information System (IPPIS) in 16 ministries so far, which has helped reduce the number of ghost workers on government payroll by about 6,000, adding the government is poised at extending the system to other ministries, departments and agencies (MDAs).

Mr Aganga said the review of expenditure in recent years indicated a disproportionate portion the national budget was allocated to recurrent expenditure, a development he described as quite unsatisfactory, given the country’s level of socio-economic development.“In 2007, 2008 and 2009, 67.79 per cent, 69.42 per cent and 69.83 per cent of the Budget, respectively, was spent on recurrent outlays. In 2010, based on the Amendment and Supplementary Budgets, 66.4 per cent was allocated to recurrent expenditure, compared to the balance of 33.6 per cent allocated to capital spending. As a result, fewer budgetary resources may be available for critical infrastructure,” he said.

“It is clear that if we do not deal with the bloated level of our recurrent expenditure and overheads in addition to seriously addressing the poor quality of our capital expenditure, it will be difficult to have the economy we need to achieve sustained double digit growth. We want to lay the foundation that will accelerate our economic growth,” the minister declared.

Reviews and recommendations

To address the imbalance, he said government considered committee that would review allocations and come up with recommendations, medium-term action plan and timetable that would guide the decision by the Federal Executive Council (FEC) on the issue.

Specifically, the committee was charged with the responsibility of comparing trends in our government’s recurrent expenditure outlays with those of other countries with similar levels of socioeconomic development; rationalise it by identifying the most viable efficiency-promoting measures, as well as come up with an appropriate size of the public sector workforce.

Besides, the committee would propose a framework for future public service remuneration (and overheads) to ensure that wage adjustments are programmed to ensure equity, affordability and propriety of wage policy adjustments; adopt measures to curtail the proliferation of government agencies and membership of international organisations, as well as consider viable cost-saving measures to institute more efficient public expenditure priorities over the medium-term.

The Committee, which has one time Chairman of the Nigeria Economic Summit Group (NESG), Anya Anya, as Chairman, was given two months to prepare its report, including key findings and recommendations as well as framework for its implementation.Other members of the 23-man committee include: one-time Head of Service, Ama Pepple; Chairman,Federal Internal Revenue Service (FIRS), Ifueko Omoigui-Okauru; Accountant General of the Federation (AGF), Ibrahim Dankwambo; former Chief Executive, First Bank of Nigeria, PLC, Jacobs Ajekigbe; Chairman, Accenture, Nigeria, Dotun Sulaiman, and former Director General, Budget Office, Bode Agusto.

Source:NEXT