Government and imperatives of TSA

There is no doubt that the outgoing Goodluck Jonathan administration recorded some successes, particularly in the economic sphere where inflation and exchange rate had experienced some stability. But the same cannot be said of the Treasury Single Account (TSA) that would have brought transparency to the management of government finances as it failed to muster the political will to call to order some high yielding revenue parastatals that have constituted themselves into obstacle to its implementation

Indeed, one of the cardinal components of the Federal Government’s Economic Reform Programme (ERGP) that commenced in 2004 was the implementation of the TSA,  a unified structure of government bank accounts that gives a consolidated view of government’s cash resources, based on the unity of cash and the treasury.

TSA is a centralized cash position of the treasury, where the revenues of all government MDAs are consolidated and all cash outflows (payment and transfers) are executed in a single account within the custody of the Central Bank of Nigeria (CBN).

Championed by the Office of Accountant General of the Federation (OAGF) in collaboration with the CBN, TSA commenced in January 2012 after rigorous planning and extensive stakeholders’ engagement.

Other objectives of TSA are to help government unify banking arrangements; assist the government in the efficient utilization of government funds for approved projects; promote transparency and accountability in government operations; and reduce the amount, and cost of government borrowing by maximising the use of available government resources to deliver projects.

However, the success of the project was predicated on the highest political support it enjoyed from the country’s number one citizen, a situation that would have made the ministers and other government functionaries fall in line.

For instance, President Jonathan in his 2014 New Year address to the nation affirmed that the TSA would be completed in the year: “We shall complete the deployment of the three electronic platforms in 2014 – namely, the Treasury Single Account (TSA), the Government Integrated Financial Management Information System (GIFMIS) and the Integrated Payroll and Personnel Information System (IPPIS) – which are all geared towards improving efficiency and transparency in our public finances. Through these reforms, we have already saved about N126 billion in leaked funds and intend to save more.”

TSA has two main parts namely, the payment of salaries, suppliers, taxes and others; and the collection of independent government revenues. While the payment side of TSA commenced in January 2012, the collection side was scheduled for nationwide kick off in January 2015.

With the activation of the payment side of TSA in January 2012, the processing of payment transactions by MDAs which hitherto was done largely via manual mandates to DMBs or the CBN were being processed electronically in line with the CBN National Payments Strategy Vision (NPSV) 2020 initiative.

Consequently, all government payments were routed from the Government’s central financial management system (GIFMIS) to CBN’s Payment Gateway to effect electronic payments into the accounts of individual or corporate beneficiaries in commercial banks, micro finance banks and primary mortgage institutions, thereby creating a fully automated payment and collection process for the Federal Government.

In addition to payments, TSA will also streamline and automate the independent revenue collections of MDAs using the Government Integrated Financial Management Information System (GIFMIS) and the CBN Remita payment gateway. This is being done in collaboration with Deposit Money Banks (DMBs) and other electronic collection channels like Internet Banking, PoS, ATMs, mobile wallets and electronic cards.

We consider full execution of this initiative imperative given its benefits to the economy. Some of its benefits include plugging loopholes in the federal government revenue collection system; enthroning a new regime of transparent and accountable Internally Generated Revenue (IGR) management; and improving funds availability for funding of poverty eradication programmes and other infrastructure development.

It is however, regrettable that despite the laudable objectives of the project, it is still experiencing  pockets of resistance from some of these ministries, departments and agencies (MDAs), whose officials have constituted themselves into a ‘cabal’ and, in connivance with some banks, have continued to frustrate its full execution.

The worrisome challenge here is that the MDAs are concerned about the reduced patronage of government contractors who, before now, were always trooping to MDAs’ offices to seek payment of their invoices, and the loss of access to independent revenues collections made on behalf of government, as this will now be paid directly into a central account.

Considering the alleged high level of corruption and leakages in the system, we also regret the failure of the Jonathan administration to do itself good and go down in history mustering the courage and will to call the bluff of the ‘super’ government officials frustrating full implementation of the TSA initiative.

We only hope the incoming Buhari government would learn from past mistakes and correct them immediately on assumption of office next month.