Thursday, June 13, 2024

Tinubu closes Buhari’s single treasury account, asks MDAs to remit 100% revenue to new account

Agencies not funded by the federal government are also expected to remit 50 per cent of their generated revenues.

• January 2, 2024
President Bola Tinubu and Muhammadu Buhari
President Bola Tinubu and Muhammadu Buhari

President Bola Tinubu’s administration has directed that all ministries, departments, and agencies fully funded by the federal government remit 100 per cent of their revenues into a Sub-Recurrent Account, a sub-component of the Consolidated Revenue Fund (CRF), where the federal government will now receive and consolidate its revenue earnings.

This directive, issued in a December 28 circular by the Finance Ministry and publicised on Tuesday, effectively closes the single treasury account operated under the erstwhile Muhammadu Buhari administration.

It is the latest of the federal cabinet’s move to “improve revenue generation, fiscal discipline, accountability and transparency” in resource management and waste prevention under Bola Tinubu’s nascent presidency.

“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 should remit one hundred per cent of their Internally Generated Revenue (IGR) to the Sub-Recurrent Account, which is a Sub-component of the Consolidated Revenue Fund (CRF),” the directive read.

“Agencies and departments that are partly funded by the federal government – having budgetary allocations for capital or overhead expenditures – are expected to remit 50 per cent of their gross revenue while statutory revenue like “tender fees, contractor’s registration, sales of government assets, etc should be remitted one 100 per cent to the sub-recurrent account,” it added.

Agencies not funded by the federal government are also expected to remit 50 per cent of their generated revenues.

“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 50 per cent auto deduction in line with Finance Act, 2020 and Finance Circular, 2021, 50per cent cost to revenue ratio,” it added.

While the current approach bears resemblance to the previous administration’s strategy, all revenues in the new processes are consolidated into a unified treasury account, and the Office of the Accountant General calculates deductions according to approved percentages. The remaining funds are then entrusted to the remitting agency. This contrasts with the prior administration, where agencies autonomously determined the remittances they provided to the federal government.

“The Office of the Accountant General of the Federation (0AGF), subject to the categorisation 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 the amount due to the Consolidated Revenue Fund,” the directive read.

The stringent enforcement of this policy is anticipated due to the close collaboration among the Ministry of Finance, the Accountant General, and the Office of the Coordinating Minister of Economy.

The accountant general is tasked with overseeing, monitoring, and conducting a monthly review of both the existing and new accounts of agencies/parastatals. This ensures that only funds approved by the Honourable Minister of Finance and Coordinating Minister of the Economy (HMFCME) and the Accountant-General of the Federation (AGF) are credited to supplementary accounts that the departments and agencies would use to hold internal funds.

All ministries and agencies concerned are expected to fully comply with the directive except when expressly permitted to act differently.

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