2025 budget: Senate threatens zero allocation for defaulting MDAs
The Senate, through its Finance Committee, has issued a stern warning to the Federal Government’s Ministries, Departments and Agencies, threatening zero allocations in the 2025 budget for those that fail to appear before it to account for funds allocated in the 2024 fiscal year.
The committee, during its session on Monday, expressed dissatisfaction with irregularities discovered in the financial records of several agencies.
The warning emerged during an investigative hearing on Internally Generated Revenue, Fiscal Accountability and Nigeria’s Financial Management System.
The committee’s Chairman, Senator Sani Musa (APC, Niger East) in his closing remarks after an interface with the Accountant-General of the Federation, Oluwatoyin Madein, said, “This performance index exercise on the various MDAs is preparatory to the 2025 budget. Any agency that fails to appear before this committee upon invitation, risks zero allocation in the 2025 budget because records of how appropriations made for 2024 are expended, (and) must be provided with facts and figures.”
The AGF had, before the threat, presented a summary of IGR for the Federal Government up to September 2024.
The reported figures included independent revenue of ₦2.7 trillion; operating surplus from government-owned enterprises amounting to ₦2.3tn; and Ministries, Departments and Agencies’ IGR of ₦344 billion.
However, the committee noted that the submitted report focused solely on the Accountant-General’s office, with significant omissions regarding the FG’s overall financial activities.
In light of the gaps identified, the committee resolved to invite other relevant agencies, including the Revenue Mobilisation Allocation and Fiscal Commission, the Nigerian Extractive Industries Transparency Initiative, and the Nigerian National Petroleum Corporation Limited, for a joint session to ensure a comprehensive review of the discrepancies.
“This is not about hearing from one side and another separately. We need all stakeholders present at the same time to provide clarity and consistency in their reports.
“The Senate’s hearing reflects growing efforts to strengthen Nigeria’s financial oversight and accountability mechanisms, with a shared commitment to enhancing transparency and building a robust fiscal policy framework,” he added.
Other members of the committee during the interface with the AGF, expressed deep frustration over the persistent delays in the release and utilisation of capital budgets, citing inefficiencies within the centralised payment system managed by the AGF’s office.
Concerns were also raised about contractors being required to pay under-the-table fees, reportedly 5% of the contract value, to expedite their payments.
This practice, if verified, according to them, represents a major accountability issue, undermining the system’s efficiency.
The AGF revealed that stamp duty revenues from 2020 to 2024 were disappointingly low, totalling ₦30.3 million compared to the ₦301 million Internally Generated Revenue.
However, the lawmakers linked this to poor budget performance as taxes are only collected when payments are made.
The committee, however, gave the AGF until Wednesday, December 11, 2024, to provide all requested reports ahead of a follow-up meeting scheduled for 2 pm the same day.
