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A minister, efficiency and value for money

By Joe Chidi
31 March 2017   |   1:53 am
A lot of controversies have trailed the Federal Government over the years in terms of how the nation’s resources have been spent. The nation has seen outrageous amounts apportioned to non-capital projects while the infrastructure deficit widened.

Nigeria’s finance minister Kemi Adeosun PHOTO: PHILIP OJISUA

“Our country, right or wrong. When right, to be kept right; when wrong, to be set right.” – Carl Schurz

A lot of controversies have trailed the Federal Government over the years in terms of how the nation’s resources have been spent. The nation has seen outrageous amounts apportioned to non-capital projects while the infrastructure deficit widened.

However, the present administration, under the leadership of President Muhammadu Buhari is dedicated to putting a stop to all forms of unnecessary spending in the government. It was on this note that Mrs. Kemi Adeosun, the Minister of Finance secured approval to create the Efficiency Unit in November 2015 under the Federal Ministry of Finance.

Given the extensive scope of its mandate and the urgent need for the government to spend its financial resources more judiciously, the E-Unit is supervised by a Steering Committee chaired by the Honourable Minister of Finance.

The Efficiency Unit was saddled with the responsibility of ensuring that all government overhead expenditures are necessary and represent the best possible value for money by eliminating leakages, wastages and promoting transparency. This includes overhead expenditure on travel, training, printing, IT consumables and stationeries among others.
The other component of its mandate is to identify best practices in procurement that will translate to savings for the government.

Since its creation, how well has this unit delivered on its mandate? Have they really lived up to expectation? So far, the unit has been able to pursue its mandate effectively. Within a short period of about 12 months the unit mapped out its strategies for delivering tangible results to Nigerians and has already implemented some.

One of its immediate actions upon reviewing the overhead expenditure of the Federal Government for prior years was to recommend controls and limits on spending on items such as travels, training, welfare, honourarium and sitting allowance, meals and refreshments, as well as adverts and publicity where unjustifiably large amounts were expended annually. Working with the Office of the Secretary to the Government of the Federation and the Head of the Civil Service of the Federation, a total of Six (6) Circulars have been issued to moderate costs and introduce standards for all MDAs. The first among the circulars was on travels where the government spent an average of N83 billion annually or over 18% of the total overhead expenditure in prior years.

Nigerians had watched over the years as public officials criss-crossed the world for meetings and conferences which were either of little relevance, could have been handled by smaller delegations or through the use of ICT. The circulars issued by the Secretary to the Government of the Federation and Head of Service on Travels preclude public officials from travelling First Class and further restricted the number of persons who can travel by Business Class to only Heads of MDAs and Chairmen of Boards of Government Agencies and Parastatals. Through these circulars initiated by the Efficiency Unit, this avenue for wastage has been blocked. The estimated savings from this initiative is over N10 billion yearly. Also, foreign travels for training have been curtailed.

It is common knowledge that the government has many agencies and parastatals and considerations have been given in the past on how to streamline them. What was not widely known was that in 2011, Sitting Allowance for Federal Boards and Committees was increased while the frequency of payment was doubled from four to eight times. In the light of the availability of various ICT facilities for meetings, which are more cost-efficient, the E-Unit recommended a reduction of 50 per cent in the frequency of payment of Sitting Allowance to four and a circular was issued by the Secretary to the Government of the Federation to that effect to all MDAs. The savings from this action excluding savings on other costs associated with Board and Committee Meetings such as estacode/per diem, meals, refreshments etc is about N1 billion per annum.

Another area of non-priority spending by MDAs which was identified for curtailment by the Efficiency Unit was souvenirs such as T-Shirts, Face-Caps, folders, etc and printing of short-lived or non-essential publications. Nigerians and the economy will be better-off if such spending is deployed to roads, education, health etc. which is the direction the administration of President Muhammadu Buhari is pursuing.

The E-Unit has also helped to cut costs for the benefit of the larger Nigerian populace on spending by MDAs on meals and refreshments at meetings, seminars, workshops, etc, where on the recommendation of the E-Unit the Head of Service issued a circular imposing limits per person for tea break, lunch and dinner. Prior to this circular, such limits where they existed at all were at the discretion of each MDA. Savings to government from this initiative alone has been put at about N1 billion annually.

Considering the complex nature of large bureaucracies such as the Nigerian Public Service, the ability of the E-Unit to secure the release of six circulars within a short space of its operation is commendable.

Also, the unit has made a proposition that some government agencies be relocated to buildings forfeited to government to reduce expenditure on rent. Some progress has been made in this area.

The positive results recorded by the unit in cost cutting were also extended to the other aspects of its mandate which have to do with procurement. In this case the unit has engaged the Bureau of Public Procurement specifically to reduce the administrative costs associated with the subsisting procurement process and institutionalise a wholesale procurement process where MDAs can pool their demands for standard goods and benefit from price discounts. The E-Unit and the BPP are working on a Circular to MDAs that will guide the operation of the initiative. In the meantime, within a short period, the Unit secured discounts of 5-50 per cent from 19 local and international airlines with a potential savings to government of about N5 billion on air travels.

Since the mandate of the unit inherently involves changes in the ways MDAs operate, the unit embarked on a massive sensitisation programme to create awareness about its creation and activities and to secure the buy-in of stakeholders.

It is expected that in 2017, the E-Unit will complete its on-going initiatives and additional ones which have already been identified. One job well done can be redemption for many mistakes of the past. The creation of the Efficiency Unit by the current administration has ensured that the government’s financial resources are allocated in a manner that prioritises spending on capital projects which is necessary for development, while also achieving transparency and prudence in the use of its limited resources. This has the potential for introducing other reforms in the public sector for public good.
Chidi is a public affairs commentator based in Port Harcourt

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