FRC: Amendment of fiscal responsibility law will set debt limit for FG, states

The Fiscal Responsibility Commission (FRC) says there’s a need for the immediate passage of the amendments to the Fiscal Responsibility Act, 2007 (FRA, 2007).

The commission said the amendment would set a debt limit for the federal and state governments.

The Fiscal Responsibility Act 2007 is primarily designed to checkmate wastage and corruption.

Victor Muruako, FRC chairman, Victor Muruako made the call on Wednesday at an interactive session in Abuja.

The event was under Growth Initiatives for Fiscal Transparency (GIFT) Nigeria, organised by OrderPaper Advocacy Initiative in collaboration with other stakeholders.

Muruako said the call was necessary due to the worrisome trajectory of debt accumulation at all levels.

He said there was an urgent need for the national assembly to conclude the amendment of the FRA, 2007, to check loopholes in the public finance management (PFM) system.

“We are calling on finance committees in the 9th Senate and House of Representatives to accelerate the amendment and passage of the FRA Act, 2007 before they wind down their sessions come 2023,” he said.

“This is because there are several loopholes in the current Act that has made the government vulnerable to massive looting, corruption and even freedom to borrow without necessary steps followed. There is no doubt that if they fail, there will be business as usual across the MDAS (Ministries, Departments and Agencies), which may further worsen the rate of national development.”

Muruako decried the nonchalant attitude of MDAs towards the remittance of public funds, capitalising on the gaps in the FRA, especially the lack of sanctions for non-compliance.

According to him, a review of the Act with specific sanctions for failure to remit revenues would compel public officer holders to make adjustments.

He further disclosed that the Act identified 50 offences and violations yet did not provide sanctions to punish offenders.

The FRC chairman, while describing the uniqueness of the Act, said that besides covering some issues on PFM like the Medium-Term Expenditure Framework (MTEF), upon which annual budgets are anchored and also sets thresholds for debt/borrowing at federal and state.

On his part, Chukwyemeka Abana, FRC’s director, legal, investigation and enforcement, said the commission regrets not getting the needed support from sister agencies towards actualising the amendment of the Act.

He added that the Act had undergone three amendments which were done piecemeal with the government cherry-picking areas that suited its purpose and situations.