If a Bill being considered by the House of Representatives scales legislative hurdles, the Fiscal Responsibility Commission (FRC) would be empowered to drag officials of Government-Owned Enterprises (GOEs) to court over their refusal to remit revenues to the government purse.
The House has consolidated Bills seeking to repeal the Fiscal Responsibility Act of 2007 and re-enact a new Fiscal Responsibility Act, 2024, aimed at providing prudent management of the nation’s resources, ensuring long-term macro-economic stability, and securing greater accountability and transparency in fiscal operations. This consolidated Bill successfully passed the second reading stage in the House of Representatives on Wednesday.
Sponsored by the Deputy Speaker Rt. Hon. Benjamin Kalu and six others, the Bill specifically seeks to enhance economic stability and strengthen financial resource management.
Leading the debate on its general principles on behalf of the Deputy Speaker and other sponsors, Hon. Marcus Onobun stated that the Bill aims to address existing loopholes and equip the FRC with the necessary tools for effective enforcement and revenue generation.
He explained that given the dire state of the country’s revenue profile, it has become imperative to reposition and strengthen the structure, functionality, and effectiveness of the FRC through the repeal and re-enactment of the Fiscal Responsibility Act, 2007. This aims to ultimately increase the Commission’s capacity to generate independent revenue into the Consolidated Revenue Fund (CFR) of the Federal Government.
According to Onobun, sections 22(1) & (2) of the Act mandate government corporations listed by the Commission to remit 80% of their operating surplus to the consolidated revenue fund while retaining 20% in their general reserve fund. However, he lamented that many GOEs fail to meet this requirement at the end of the financial year as stipulated by section 22 of the Fiscal Responsibility Act, 2007.
The contemplated review seeks to expand the Commission’s powers, including conferring direct prosecutorial authority, significantly enhancing its ability to enforce the Act’s provisions, particularly in collaboration with anti-corruption agencies.
Onobun noted that the Fiscal Responsibility Act, 2007, which has been in operation for over a decade and a half, contains certain loopholes and weaknesses that have hindered its effective implementation.
He elaborated: “The Act lists Corporations and GOEs directly covered by it. Between the time of enactment and now, many agencies have been added or removed from the list following reviews by the Ministers of Finance, bringing the total to 68 Corporations and GOEs. These additions have necessitated the review of over 47 sections of the extant Act.”
Sections 50-52 of the Bill propose detailed provisions on offences and penalties for infringements and contraventions of the Bill once it is passed into law. The proposed punishments are categorised into administrative and penal sanctions.
The Bill was put to a voice vote by the Speaker, Rt. Hon. Tajudeen Abbas, who presided over the plenary session. It received majority support from lawmakers and was referred to the Committee on Finance for further legislative action.
