Business
Auditor general queries ministry’s N3.8bn spending from suspended RUGA fund
The Office of the Auditor-General of the Federation has queried the Federal Ministry of Agriculture for spending a total sum of N3.809bn on the suspended Rural Grazing Area scheme without a presidential approval or National Assembly appropriation.
The query is part of the eight audit queries issued against the ministry in the ‘Auditor-General for the Federation’s Annual Report on Non-Compliance/Internal Control Weaknesses Issues in Ministries, Departments and Agencies of the Federal Government of Nigeria for the Year Ended 31st December, 2019.’
The OAuGF had queried expenditures totaling N60,795,898,225.84 by the ministry.
The Acting Auditor-General of the Federation, Adolphus Aghughu, presented the report to the Clerk to the National Assembly, Ojo Amos, on September 15, 2021, while the Senate and House Committees on Public Accounts commenced investigation into the queries.
The Federal Government had introduced the RUGA scheme in May 2019 but was forced to suspend it in the July of the same year due to the wide criticisms that trailed it.
According to the OAuGF, the ministry, in violation of the presidential directive suspending the scheme, allegedly initiated and paid out N3.433bn without due process.
The query read in part, “Ninety-five (95) payment vouchers were raised and paid from RUGA Intervention Fund between 1st August, 2019, and13th September, 2019, totaling N3,433,984,692.66, and the above payments were initiated and paid without due process after the Presidential directive suspending the RUGA project.”
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The ministry also paid out an additional N375,785,893.75 to some individuals and corporate organisations from the RUGA Intervention Fund through 13 payment vouchers without approval, according to the Auditor-General.
According to the report, the payments include N202.7m and N160m paid for transportation and other expenses in support of victims of banditry in Zamfara State, and advance payment meant for sensitisation and advocacy visits to the Governor of the state, respectively.
The report quoted the ministry’s management to have said, “The action is regretted and is also being investigated.”
The office, however, blamed the two expenditures on weaknesses in the internal control system at the Federal Ministry of Agriculture and Rural Development.
The Auditor-General consequently recommended that the withdrawals from the RUGA Intervention Fund be refunded to the Federal Government’s coffers as they were in breach of the extant laws and the financial regulations of the country.
The report also indicted the ministry over extra-budgetary spending of about N48.425bn on contractual liabilities, adding that despite a budgetary release of N98,044,134,611, representing 99.07 per cent of its 2018 capital allocation, the ministry did not take necessary actions to pay eligible contractors, which led to an outstanding contract liability of N48.425bn.
The office also accused the ministry of misappropriating the sum of N7.737bn first quarter capital allocation while paying for the 2018 capital projects, which was fully funded and released.
The query read in part, “There were no acceptable justifications for utilising 2019 1st quarter capital release to pay for 2018projects.”
The Auditor-General, therefore, demanded that the Permanent Secretary of the ministry be asked to give valid reasons for paying for projects fully funded from 2019 releases.
The office also demanded that the money be recovered and returned to government coffers with evidence forwarded to the Public Accounts Committees of the National Assembly or be sanctioned in accordance with financial regulations.
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The audit report also accused the ministry of failure to deduct and remit over N89m stamp duty on contracts in violation of Federal Treasury Circular which makes it mandatory for all MDAs to deduct and remit one per cent stamp duty on contract agreement before payment is made to the beneficiary.
The report further alleged that the ministry paid Value Added Tax of N24,799,539.17 directly to contractors in violation to Paragraph 234 (ii) of the Financial Regulations (2009) which states that, ‘Any loss of government revenue through direct payment of VAT and WHT to contractor or failure to provide for VAT and WHT due and remitting same to the Federal Inland Revenue Service by any ministry/extra-ministerial department shall be recovered from the statutory allocation of the defaulting ministry/extra ministerial office and other arms of government.’
The Auditor-General further indicted the ministry for allegedly violating the Federal Government’s e-payment policy as contained in the government’s E-payment Circular Ref. No. TRY/A8/B8/2008 dated October 22, 2008.
The office said the ministry paid N700,179,314.37to persons other than the direct beneficiaries of such payments through eight payment vouchers, adding that the ministry’s response to the expenditure was that “direct payment could not be made to beneficiaries because they were yet to be enrolled on the GIFMIS Platform; however, efforts are ongoing to conclude the enrollment process.”
The report also accused the ministry of failure to deduct and remit Withholding Tax and Value Added Tax of N8,886,291.47 from two contractors to relevant tax authorities as required by extant regulations.
Punch
Aviation
Safety: NCAA to audit all domestic airlines, says Aviation minister
Safety: NCAA to audit all domestic airlines, says Aviation minister
Minister of Aviation and Aerospace Development, Festus Keyamo, has said the Nigerian Civil Aviation Authority (NCAA) will carry out a comprehensive audit on all local airlines over safety concerns.
This is coming after a runway incursion incident in which Dana Air’s plane carrying 83 passengers with six crew members skidded the runway at the Lagos airport leading to diversion of flights
The operations of Dana Air were immediately suspended and NCAA directed to commence a comprehensive audit on the airline.
Keyamo spoke on the general audit of all domestic airlines on Thursday when he appeared on Channels TV Politics Today programme.
He said beyond the suspension of Dana Airlines and the ongoing audit of the airline, all other carriers in the country would be audited to guarantee the safety of passengers and the health of the civil aviation industry.
The directive to suspend the operations of the Dana Air was contained in a letter issued and endorsed by the NCAA Acting Director General, Chris Najomo, in Abuja.
It is the second time within two years that the NCAA would suspend the airline’s operational licence over safety violations.
It said the latest action was based on “elevated safety concerns” posed by the airline.
“As a precautionary step, and in accordance with Sec 31 (7) of the Civil Aviation Act 2022, the Authority has imposed a suspension on your Air Operator Certificate (AOC) with effect from 24″ April, 2024 at 23:59 to allow for a thorough safety and economic audit,” the letter partly read.
The NCAA also stated, “The safety audit will entail a re-inspection of your organisation, procedures, personnel, and aircraft as specified by Part 1.3.3.3 of the Nigeria Civil Aviation Regulations, while the economic audit will critically examine the financial health of your airline to guarantee its capability to sustain safe flight operations.”
Business
Anxiety as dollar exchanges for N1,420/$ on parallel market
Anxiety as dollar exchanges for N1,420/$ on parallel market
There are fears prices of essential goods including food items in Nigeria may begin to rise again as naira witnessed a major slide against the United States dollar at the foreign exchange market on Thursday.
The naira fell to N1,309/$ on the official market and N1,420 on the parallel market, according to multiple sources.
This indicates a fall of N90 or 6.8 per cent from N1,330 recorded on Wednesday.
The latest downward trend in naira rate after recording appreciable gain for some weeks followed high demand for dollars.
A report by The Punch quoted currency traders at the popular Wuse Zone 4 market in Abuja as buying the greenback note at N1,340 and selling at N1,420, leaving a profit margin of N80.
In Lagos, a trader Ibrahim Garba told Newstrends that the naira-dollar rate changes almost hourly.
“It was selling at N1,380/$ at 11am today (on Thursday) and by 2pm, it had moved to N1,400/$,” he said.
The naira has this lost 26.2 per cent in two weeks when compared to N1,125/$ on April 12, 2023 on the parallel market.
The Central Bank of Nigeria on Monday approved the allocation of $15.83 million to 1,583 BDC operators.
This was aimed at enhancing liquidity in the unofficial market.
The CBN in a letter to BDCs announced the allocation of $10,000 to operators across the country.
The allocation came at N1,021)$, aimed at stabilsing the foreign exchange market and ensuring accessibility of foreign currency to eligible end users.
Last weekend, the CBN Governor, Yemi Cardoso, said the Naira was declared the best-performing currency globally as of April 2024.
The naira was about the worst currency in March when it fell to as low as N1,600/$1 on the official market and N1800/$1 on the parallel market
Business
BDCs blame peer-to-peer Binance, others for naira fall
BDCs blame peer-to-peer Binance, others for naira fall
The president of the Association of Bureau De Change Operators of Nigeria, BDCs, Aminu Gwadabe, says BDC operators are committed to preventing speculators from attacking the naira.
Mr. Gwadabe said this in an interview on Wednesday in Abuja.
The Association of Bureau De Change Operators of Nigeria, as a self-regulatory body, has platforms to check the excesses of BDC operators, he noted.
“We have inaugurated state chapters whereby we can have a database of participants in the forex market. This is for the Financial Action Task Force (FATF) to understand this market and to know the participants; give them a simple registration,” he said.
Mr. Gwadabe said that the foreign exchange market needed a kind of harmonisation, centralization, and KYC to identify all business participants.
“This will enable the CBN to track other players in the market other than the BDCs and their levels of involvement. The BDCs is collaborating with the regulatory authorities for physical verification of offices using technology.
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“We want to balance international obligations with our own objectives. International obligations are templates that have been built without our input. We are coming up with our own template to balance it. We have seen some illegal economic behaviour, and the CBN and the security agencies are aware, and I am sure they will nip it in the bud,’’ he added.
He said the recent wave of naira depreciation was of concern to the BDC operators.
Mr. Gwadabe explained, “I am happy that the authorities, and even the BDCs as operators, have identified the peer-to-peer (P2P) platform. P2P is a platform like Binance where speculators use the dollar to buy USDT, a stablecoin that is pegged at one to the dollar.
“As long as Binance and such other platforms continue to be profitable, the naira will continue to depreciate. There are many of them in the system. Binance has been nipped in the bud, but there are still many. They are online platforms with no registration or restrictions.”
Mr. Gwadabe said that the CBN and the security agencies were already aware of the antics of the platforms. According to him, they are more of an illegal form of economic behaviour, and the people behind them lack patriotism.
“People have turned the dollar into an asset—a commodity of trade—which is why those platforms continue to thrive. We have seen where people are buying dollars into their domiciliary accounts to finance these schemes. A lot of millions of dollars are going out of the system. It is one USD to one USDT. The market can be liquid.
“Binance alone has four billion dollars of liquidity and more than two million transactions. Most of them source money to finance their transactions on the open market, and that is one of the reasons why the naira is depreciating,’’ he said.
BDCs blame peer-to-peer Binance, others for naira fall
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