FG agencies, parastatals to remit 50% gross IGR, says Wale Edun

The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun has directed all self-funded Federal Government Agencies/Parastatals (receiving no allocation from the Federal Government Budget) to remit 50per cent of their gross Internally Generated Revenue (IGR) to the Sub-Recurrent Account.

He stressed that the remittance includes all statutory revenue line like tender fees, contractor’s registration, sales of government assets etc to the Sub Recurrent Account.

The Minister in a signed circular with Ref. Nos. FMFBNP/OTGHERS/IGR/CRF/12/2021 dated December 2021 on Revenue, Expenditure and Internally Generated Revenue (IGR) Remittances to the Consolidated Revenue Fund (CRF); the following guidelines are hereby issued for immediate compliance by all Federal Government Agencies/Parastatals for the collections, utilization and remittances of IGR, stated that  all Ministries, Departments and Agencies (MDAS) that are fully funded through the Annual Federal Government Budget (receiving personnel, overhead and capital allocation) and on the schedule of Fiscal Responsibility Act, 2007 and any addition by the Federal Ministry of Finance (FMF) should remit 100 per cent  of their IGR to the Sub-Recurrent Account which is a Sub – component of the Consolidated Revenue Fund (CRF).

According to the circular,  “All partially funded Federal Government Agencies/ Parastatals (receiving capital or overhead allocation from the Federal Government Budget) should remit 50 per cent of their gross IGR, while all statutory revenue like tender fees, contractor’s registration, sales of government assets etc should be remitted 100 per cent to the Sub-Recurrent Account.

“For the avoidance of doubt, the Office of the Accountant-General of the Federation shall open new TSA Sub-Accounts for all Federal Government Agencies/Parastatals listed on the schedule of Fiscal Responsibility Act, 2007 and any additions by the Federal Ministry of Finance, except where expressly exempted.

“The new account opened for Agencies/Parastatal shall be credited with inflows in the old revenue collecting accounts based on the new policy implementation of 50per cent auto deduction in line with Finance Act,2020 and Finance Circular, 2021, 50per cent cost to revenue ratio.

“The Office of the Accountant General of the Federation (0AGF), subject to the categorization of Agencies shall map and automatically effect direct deduction of 50 per cent  on gross revenue of Self/partially funded Agency/Parastatals and 100 per cent  for fully funded Agencies/ Parastatals as interim remittance of amount due to the Consolidated Revenue Fund. This is to improve revenue generation, fiscal discipline, accountability and transparency in the management of government financial resources and prevention of waste and inefficiencies.

“The revenue collection TSA Sub-Accounts currently operated and maintained by Agencies/Parastatals for receiving revenue from the public shall be blocked from access. The accounts shall be under the full control of the Honourable Minister of Finance and Co-ordinating Minister of the Economy and the Accountant-General of the Federation.

“To strengthen the implementation of the Presidential directives as conveyed via SGF Circular Reference: SGF.50/5.3/C.9/24 dated 16th October, 2018 on Approve Revenue Performance Management Framework for Government Owned Enterprises (GOEs), the Revenue & Investment Department and the Treasury Single Account Department of the Office of the Accountant-General of the Federation (0AGF) shall supervise, monitor and carry out a monthly review of both the old and new accounts of the Agencies/parastatals to ensure that only funds approved by the Honourable Minister of Finance and Co-ordinating Minister of the Economy (HMFCME) and the Accountant-General of the Federation (AGF) are credited to the accounts.

“The Federal Ministry of Finance (FMF) and Office of the Accountant-General of the Federation (OAGF) will recommend appropriate disciplinary actions and sanctions against defaulting Accounting Officers of Agencies/Parastatals found culpable of violating the contents of this Finance Circular and in accordance with the Fiscal Responsibility Act.

“Each Federal Government self/partially funded Agency/Parastatal shall not later than three months after the end of its financial year prepared and published its Audited Financial Statements/Management Account in accordance with the prescribed rules and forward copies to the Office of the Accountant-General of the Federation for the review and computation of operating surplus in line with the approved template of the Fiscal Responsibility Commission/OAGF. The remittable portion of the adjusted operating surplus will be determined and paid to the TSA Sub-Recurrent Account after reconciliation. The final payment to be made to the TSA Sub-Recurrent Account for the year shall, however, be the higher of the 80% of the adjusted operating surplus and the deducted amount from the TSA Sub-Rec Accounts of the affected Agencies/ Parastatals.”

The circular directed that Agencies whose budget are funded through approved cost-of-collection are expected to submit their annual revenue and expenditure budget for review.

“Any expenditure not approved and or any surplus of revenue over expenditure shall be subjected to the rules guiding the computation of Operating Surplus.

“The Office of the Accountant -General of the Federation shall generate auto receipt on direct deductions and remittances made by Agencies/parastatals to the TSA Sub Recurrent Account, which is a subcomponent of the Consolidated Revenue Fund.”

It added that, “To ensure that MDAs properly account for all revenue and expenditure, they are to submit detailed Monthly Trial Balance to the Consolidated Accounts Department, Fiscal Account (Funds Department), Revenue and Investment Department of OAGF and Budget Office of the Federation, showing clearly the revenue and expenditure on each source of fund (Statutory Allocation, Aid and Grants, Retained IGR, etc) in accordance with IPSAS Accrual Basis of Accounting. The revised list of Agencies now covered by Fiscal Responsibility Act, 2007 and additions by the Federal Ministry of Finance are attached as appendix II.

“All Accounting Officers, Directors of Finance and Accounts, Directors of Internal Audit, Heads of Accounts and Heads of Internal Audit Units of MDAs and other Arms of Government are enjoined to give this circular the widest circulation and ensure strict compliance. Any questions and clarification required on the contents in this circular should be directed to the Office of the Accountant General of the Federation.”