Set debt limit for all tiers of govt - FRC urges Buhari

Buhari2

President Muhammadu Buhari of Nigeria

President Muhammadu Buhari of Nigeria
President Muhammadu Buhari of Nigeria

The Fiscal Responsibility Commission (FRC) has called on President Muhammadu Buhari to set debt limit for federal, state, and local governments.

The acting Chairman of the commission, Mr Victor Muruako, made the call at a two-day workshop on the Fiscal Responsibility Act organised for revenue generating government agencies on Tuesday in Abuja.

According to Muruako, when set, such limits will help check the federal, state and local governments from borrowing beyond their limits.

“The Act is very clear; Section 42 says the President of the Federal Republic should set the debt limit 90 days after the commencement of the Fiscal Responsibility Act.

“There is need for Mr President to exercise that function under the act and it should be at the prompting of the Minister of Finance.

“We have written several reminders; until you get the consolidated debt limit set there will be difficulty in checkmating what the federal, state and local governments are doing.”

The acting chairman also said that the commission’s aim was to help reform the management of Nigeria’s finances through regular monitoring of government’s financial activities.

He added that it was the commission’s belief that uncompromising investigation backed by a firm commitment to enforcement of the results of the investigation would go a long way to address the mismanagement of the country’s finances.

He said that creating an enduring framework for effective and transparent financial management in the country would help curtail financial mismanagement in line with government’s agenda for transparency and accountability.

Muruako expressed dismay that the Act establishing the commission did not empower FRC to arrest, detain or prosecute violators.

“This commission has been a victim of this due mainly to the fact that by the letters of the Fiscal Responsibility Act 2007, we are only to investigate and forward reports to other authorities without the necessary powers to prosecute.

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“We are still battling to have these aspects of the law amended to enable the commission have the necessary bite against the violators of the Act,” he said.

Speaking in an interview with newsmen on the sideline of the workshop, the Director, Centre for Social Justice, Mr Eze Onyekpere, said that beyond arresting violators of the Act, punitive measures and sanctions should be put in place to stop reckless spending among public officers.

“It’s part of the reform that is being advocated that there should be penal sanctions in the law so that people can begin to feel the weight of the law when they violate the provisions of the Fiscal Responsibility Act.

“As at today what you have is more or less moral persuasion, ‘don’t this, don’t that’, but if you do, what happens,” he quizzed.

“For instance in Brazil they have both institutionalised sanctions and personalised sanctions.

“In personalised sanctions, as a politician you can be barred from holding public office or running elections for five years.

“As a civil servant you can be fined 30 per cent of your annual basic salary and you also run the risk of going to jail for between three months and five years.

“And then you begin to talk of institutionalised sanctions like a state government which is equivalent of a state government in Brazil fails to abide by the debt limit for instance.

“They will no longer be in a position to receive the transfers from the Federal Government and they may also be barred from borrowing money from the deposit money banks.”

NAN reports that the workshop, which ends on Wednesday, is aimed at ensuring that Ministries, Departments and Agencies understand the rudiments of the Act.

It is to also help them know how they can use the provisions of the Act to perform their functions to grow the Nigerian economy and increase transparency and accountability.