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Tag: TSA

  • TSA Senate report: CBN, AGF in dilemma over Remita

    TSA Senate report: CBN, AGF in dilemma over Remita

    The Central Bank of Nigeria (CBN) and the Accountant-General of the Federation are in a dilemma over how to handle the  Senate’s request on the Treasury Single Account (TSA). The Senate wants the CBN and AGF to cancel the contract with owners of Remita, which manages the TSA.

    The Federal Government has mopped more than N3 trillion into the TSA in 12 months.

    A CBN director said the bank received a second letter last week from Systemspecs, owners of Remita, requesting for payment of outstanding debt and clarifications on their future collaboration.

    The source said Remita has not been paid for its services since March, last year when the platform began to track cash in Ministries, Departments and Agencies (MDAs). It was learnt that the Nigeria Interbank Settlement Systems (NIBSS), which is being positioned to coordinate collection with Remita is not ready to undertake the assignment if the apex bank breaches the Remita contract.

    The initial payment to Systemspecs was stopped via a CBN letter dated October 27 last year and signed by the Director of Banking and Payments Systems Department, Mr Dipo Fatokun.

    In the letter, Fatokun said: ”I have been directed to inform you that you should refund all charges made into MDAs accounts as a result of the implementation of the TSA.

    “Since the cost of collection must have been shared by all the stakeholders, you are hereby required to also provide a schedule of the total amount collected and the portion that was shared to each of the participants.”

    But the Executive Director of Systemspecs Ltd, Mr Aderemi Atanda, declined to confirm if such a letter was sent to the CBN last week.

    “We are talking to the CBN, the Accountant-General of the Federation and the Ministry of Finance about the way forward because we are not averse to renegotiation of the contract to move forward in the interest of the TSA success,” Atanda said, adding: “this is normal because they are the key stakeholders in the project”.

    The letter, a copy of which was sent to the AGF and the Ministry of Finance, is believed to be the second three weeks, seeking clarification on the contract and its payment.

    While the CBN, the MoF and the AGF are believed to be disposed to upholding the contract and the use of Remita for the continued success of the TSA, the Senate has a different view.

    The Senate, in a 42-page report prepared in February, asked the CBN to cancel the contract.

  • TSA Senate report: CBN, AGF in dilemma over  Remita

    TSA Senate report: CBN, AGF in dilemma over  Remita

    The Central Bank of Nigeria (CBN) and the Accountant-General of the Federation are in a dilemma over how to deal with  Senate’s request to cancel a valid contract with the owners of Remita platform that drives the Treasury Single Account (TSA) of the Federal Government.

    The system has helped the Federal Government to mop more than N3 trillion into the TSA in 12 months.

    A director of the CBN admitted that it received a second letter last week from Systemspecs, owners of the Remita platform, requesting for its outstanding payment and clarity on future collaboration with the apex bank.

    The source said Remita has not been paid for its services since March, last year when the platform began to track monies in Ministries, Departments and Agencies (MDAs) even though the Nigeria Interbank Settlement Systems (NIBSS) which is being positioned to coordinate collection with Remita and partly owned by the CBN, is not ready to undertake the assignment should the apex bank decide to breach the Remita contract.

    The initial payment made for the services of Systemspecs was taken back via a CBN letter dated October 27 last year and signed by the Director of Banking and Payments Systems Department, Mr Dipo Fatokun.

    In the letter, Fatokun said: ”I have been directed to inform you that you should refund all charges made into MDAs accounts as a result of the implementation of the TSA.

    “Since the cost of collection must have been shared by all the stakeholders, you are hereby required to also provide a schedule of the total amount collected and the portion that was shared to each of the participants.”

    But the Executive Director of Systemspecs Ltd, Mr Aderemi Atanda, declined to confirm if such a letter was sent to the CBN last week.

    “We are talking to the CBN, the Accountant-General of the Federation and the Ministry of Finance about the way forward because we are not averse to renegotiation of the contract to move forward in the interest of the TSA success,” Atanda said, adding that “this is normal because they are the key stakeholders in the project”.

    The letter, a copy of which was sent to the AGF and the MoF, is believed to be the second in a space of three weeks demanding for a position regarding the contract and its payment.

    While the CBN, the MoF and the AGF are believed to be disposed to upholding the validity of the contract and the use of Remita for the continued success of the TSA, the Senate has a different view.

    The Senate, in a 42-page report prepared in February this year, asked the CBN to cancel the contract.

    Curiously, the upper legislative house, which had declined to put its own fund in the TSA for transparency reasons, had told the CBN in one breath to terminate the contract with Systemspecs claiming that the one per cent commission to be shared by all the parties involved are prohibitive (50 per cent to platform providers Systemspecs; 40 per cent to banks; and 10 per cent to CBN).

    In another breath, the Senate said the CBN could continue with Remita but renegotiate the charges to between between N500-N700 per transaction even though transactions run into millions and some transactions captured on the Remita platform had been as little as N200.

    According to the Senate report, “given that the systemspecs  provided solution and services at the nick of time, and has allowed it to be used in spite of a freeze on its upfront deduction, as transaction fees, the committee hereby recommends that its efforts should be rewarded based on the CBN approved rate band of between N500- N700 per transaction for electronic  transfer/ payment as specified in the CBN revised guideline.”

    The apex bank source,  however, said it will amount to financial suicide to follow the Senate’s recommendation by allowing payment of up to N700 per transaction to platform owners. “Imagine paying N700 each for all the single transactions entering the system to Remita and other parties,” he queried.

    The source, however said a more probable arrangement would be the submission of a committee led by the MoF to cap N100 payment per  transaction not exceeding N5000 effective January 1 this year and the payment exemption of the big collection chunks that arrived through Remita between September  and October last year. It is unclear if such offer will be acceptable to Systemspecs because of the significant loss of anticipated revenue from the software resource.

    When asked about the MoF-led committee recommendation, Aderemi said: “We are open to renegotiation of the terms and to continue working with the stakeholders to make the TSA a success story.”

    The AGF who spoke at the Institute of Chartered Accountants of Nigeria (ICAN) United Kingdom (UK) international zonal conference in London in the previous week, said  the TSA is supported by two core systems, namely the Government Integrated Financial Management and Information System and also the CBN Payment Gateway–Remita@CBN.

    Represented at the event by Mr M. Zakari, the AGF said total inflow into the TSA as at end of March this year was about N3 trillion from over 17,000 accounts of 976 MDAs. The A GF said the TSA has instilled fiscal discipline and eliminated the process of cash backing MDAs account with the commercial banks. He said the Federal Government, which is the key promoter of TSA, will continue to provide guidelines on its implementation to ensure the maximisation of its expected benefits.

  • Buhari, TSA and the economy

    Buhari, TSA and the economy

    Despite the huge revenues oil generated under  past administrations, the economy was in shambles when President Muhammadu Buhari took over last May.

    Although it was called the largest economy in Africa, it had minimal or no impact on the life of the ordinary man on the street.

    Infrastructural decay was the order of the day in the various sectors of the economy.

    The main reason for the poor state of the economy was traceable to the massive treasury looting and mismanagement in the country.

    The treasury, which was to hold resources for the commonwealth and benefits of Nigerians, was leaking from various points into private pockets.

    The situation was so bad that Buhari had to raise the alarm on assumption of office that he met almost an empty treasury.

    Buhari and the ruling All Progressives Congress (APC) had to declare that it will take some time for the mess left behind by the 16 years rule of the Peoples Democratic Party (PDP) to be cleared.

    Only time will tell how long it will now take to clear the mess and fix the economy for the man on the street to start feeling the positive impact of the CHANGE agenda of the Buhari administration.

    To stop the trend, several steps, however, have been taken by the new administration in the past ten months to patch the leaking treasury and block conduit pipes some fraudulent Nigerians have been using to siphon money into their pockets.

    The implementation of the Treasury Single Account (TSA) by Buhari, which is one of the measures taken so far, will be the main focus of this write-up.

    TSA is one of the financial policies being implemented to consolidate all inflows from all the Ministries, Departments and Agencies (MDAs) in the country by way of deposit into Commercial Banks traceable into a single account at the Central Bank of Nigeria (CBN).

    The policy, which was aimed at reducing proliferation of bank accounts operated by MDAs and also to promote financial accountability among all organs of the government, was introduced under the administration of former President Goodluck Jonathan.

    But due to lack of political will and other factors, implementation of the TSA was not thoroughly followed under Jonathan.

    Even with opposition from majority of the MDAs, Buhari ensured full compliance with the policy by the MDAs from the 15th of September, 2015.

    He then brought on board Mrs. Kemi Adeosun on the 11th of November, 2015 as the Minister of Finance to propel the TSA policy among other assignments.

    The London-born Kemi Adeosun, who holds a Bachelor of Science degree in Economics from the University of East London and a Postgraduate Diploma in Public Financial Management from the University of London, is also a member of the Institutes of Chartered Accountants, England and Wales, as well as Nigeria.

    She has worked with British Telecom Company, London, Goodman Jones, London, London Underground Limited, Prism Consulting, the Price Waterhouse Coopers, London.

    The Minister has also worked with Chapel Hill Denham Management and Quo Vadis Partnership.

    Her last appointment before becoming a Minister of the Federal Republic of Nigeria was serving as Commissioner of Finance in Ogun State from 2011 to 2015.

    One of her achievements in Ogun State was the implementation of TSA which saved the state billions of naira.

    Speaking with State House correspondents, Ogun State Governor, Ibikunle Amosun had said: “Look at the Treasury Single Account (TSA), I’m happy to report that Kaduna did and we did that in August, 2011 in Ogun State.

    “That was the first thing I did when I came into office and we moved from about N730 million to over N6 billion under these four years.

    “And I’m happy that people are now seeing the importance of doing things the way it should be in line with world best practice,” he added

    Adeosun has been able to transfer her professional skills in handling the TSA at the state level to the federal level in her over four months tenure as the Finance Minister.

    As at December 2015, TSA at the federal level has yielded N2.2 trillion.

    During a meeting with Nigerians resident in London in February, Buhari had said: “So we enforced TSA and by the end of December, coming to January this year, that is last month, we mopped up more than N2.2 trillion.”

    The implementation of the policy at the federal level has also streamlined the over 200 bank accounts been operated by the Federal Government and its agencies and parastatals.

    Before the implementation of the policy by the Buhari’s administration, most government agencies that generate revenue always made sure they retired all revenue generated as expenses and management cost, leaving nothing in the account. That practice has now been halted.

    Even with the support of the bankers committee for the policy, the commercial banks in the country have lost over N2 trillion worth of deposit with full implementation of the policy.

    Besides the achievements being recorded under the policy, it will not be out of place to scrutinize further the past records in order to trace ‘who’ and ‘who’ had been involved in diverting government revenues to private pockets.

    The roles played by the commercial banks under the past administrations, which might have aided such diversion, should also be looked into.

    All those indicted should be made to face the law as a way of deterrence to others.

     

  • ‘Skye Bank didn’t breach TSA rule’

    Skye Bank Plc has refuted reports alleging that its Managing Director/Chief Executive Officer, Timothy Oguntayo, was invited by the Economic and Financial Crimes Commission (EFCC) over a Treasury Single Account (TSA) amounting to N6.5 billion.

    In a statement, the bank said there were some reports that its CEO was invited by the EFCC in connection with a Presidential Implementation Committee (PIC) account, which was closed in October 2015.

    Oguntayo, however, said during an interactive session with some customers that the balance in the Presidential Implementation Committee’s account was returned to the TSA with Central Bank of Nigeria (CBN) in October last year after the committee had completed its assignment.

    Oguntayo said the PIC account was closed immediately after the money was moved to the CBN, wondering why and where the information came from.

    “Let me state that as at the time of the said online reports, neither I, nor the Chief Compliance Officer of the bank, had received any such invitation. But importantly, the balances in the said PIC account had since been moved to the CBN in compliance with the TSA on October 2, 2015 and the account closed,” he said.

    Oguntayo said the bank does not maintain any account nor hold any funds belonging to the PIC, saying that the bank was ever ready to provide full information regarding the said account to any security agency including the EFCC.

    “As a bank, we are law-abiding citizens and are willing at any time, to honour any invitation from the law enforcement Agencies,” he said.

    The Skye Bank boss assured stakeholders, especially the bank’s customers and the general public, that the bank would continue to operate transparently at all times and uphold the valued tenets of corporate best practices in its dealings.

  • No going back on TSA, Fed Govt insists

    No going back on TSA, Fed Govt insists

    The Academic  Staff Union of Universities (ASUU), other government agencies and parastatals hoping to get exemption from Federal Government’s Treasury Single Account (TSA), have been advised to partner with government for the success of the policy.

    Head of the Civil Service of the Federation Mrs Winifred Ekanem Oyo-Ita, said the introduction of TSA will bring a lot of benefits to Nigerians, adding that those against the policy are simply being narrow-minded.

    Mrs Winifred who spoke yesterday in Lagos during an official visit to the Administrative Staff College of Nigerian (ASCON), Topo, Badagry expressed worries that some unscrupulous Nigerians might want to circumvent TSA implementation.

    She said: “TSA is a global best practice for the control of government resources. All the hue and cry of being exempted from TSA is purely being done from a narrow point of view. TSA, when it is fully rolled out, is for the benefit of everybody because it is for the central control of government resources.

    “Already, we know that there has been so many leakages; every agency and organisation was just allowed to operate by itself, but so far as government agency is drawing from the central pool, there should be a control.

    “I believe that all agencies, and universities should come to terms that TSA has come to stay and they should put in their best in ensuring its success. I do not see anything wrong with TSA, I’m only worried about how we Nigerians always want to apply things in our usual ways; trying to run away from control, accountability and discipline.”

    She said just as the new word ‘budget padding’ entered the nation’s political lexicon, she was equally shocked to learn what she also called ‘a strange development’.

    “I’m happy you said it’s a new word because budget padding is also new to me and to many Nigerians. I believe if there has been anything like that, there should be an investigation. But I am very sure that the issue has been properly addressed by the concerned parties,” she added.

    She said the major thrust of her leadership would be on training and retraining of the civil service in order to make it fit into the change mantra of the Federal Government.

    “When we talk of the change mantra, I believe we are talking about the change agenda of the present administration. How do we get the civil servants to key into this? It is to create the enabling environment for them. So the first step is to re-orientate the civil servants through training and capacity development. What I’m going to be doing is training, training and training. That is one of the reasons I’m here. This is my first major tour to one of the MDIs (Management Development Institutes) so that it can be properly reengineered towards training and capacity development,” she said.

  • Senate orders CBN to terminate TSA contract

    Senate orders CBN to terminate TSA contract

    • SystemSpecs: we ‘re committed to resolving commercial issue

    The Senate yesterday ordered the Central Bank of Nigeria (CBN) to terminate the 2013 e-payment contract renewal with SystemSpecs.

    The upper chamber also ordered the CBN to disregard the one per cent charge provided in the contract agreement with the leading indigenous software giant.

    As part of its contract with SystemSpecs, the CBN  agreed to the deduction of one per cent charge of all e-collections by SystemSpecs, operator of REMITA platform driving the Federal Government’s Treasury Single Account (TSA) initiative.

    This is part of an 11-point recommendations by the Senate Joint Committee on Finance, Banking, Insurance and other Financial Institutions and Public Accounts.

    The Senate in plenary adopted the recommendations as presented by Chairman of the Joint Committee, Senator John Owan Enoh.

    The submission of the Joint Committee was however not debated as Senate President,  Bukola Saraki, ruled that only the recommendations of the committee would be considered.

    The Senate had, at its sitting on November 11 last year debated a motion on alleged “Abuse and Mismanagement of the TSA.”

    But SystemSpecs said it is irrevocably committed to indigenous technology aapplication for national transformation

    In a statement, the firm saidthe subsisting one per cent charge eventually agreed by the CBN, banks and it at the commencement of the project was considered a good starting point which could be reviewed based on emerging realities. This much is a clear and integral part of our contracts with the CBN, it said.

    The statement reads in part: “The resounding success of the TSA project has obviously attracted attention from different quarters which may include those benefitting from the old pre-TSA order, competitors who lost out in the selection process, un-informed or under-informed commentators, and others. In it all, we have always been and will remain fully committed to the full resolution of any issue surrounding the commercial component of our contract in the overall larger national interest.

    “On a last note, we thank the Senate for its avowed commitment to preserving the national interest, the government for entrusting such a significant national IT project to an indigenous firm, and numerous Nigerians who continue to objectively analyse issues and encourage us particularly during these times.”

    The upper chamber resolved to, among others, mandate its Joint Committee on Finance, Banking, Insurance and other Financial Institutions and Public Accounts to conduct holistic investigation on the matter.

    It specifically mandated the Joint Committee to investigate the alleged abuse of the TSA and deduction of N25 billion from accounts of Ministries Departments and Agencies (MDAs) under the e-payment.

    Other recommendations also adopted by the lawmakers include: that the CBN should show evidences of all refunds made by SystemSpecs as well as identify and recommend for prosecution, all the persons involved in approving the controversial TSA contract.

    It mandated the CBN to carry out in-house enquiry to sanitise its system of contract awards to avoid future discrepancies.

    The committee said SystemSpecs deducted only N7.6 billion from its collections.

    The Senate agreed with the Joint Committee that the CBN should pay N656,504,100 only to SystemSpecs as transaction cost for funds transfer collection for the period ended Nov. 30 last year.

    It said the approval of N656 million payment was based on CBN wage band of N700 per transaction for electronic transfer payment which was adopted by the Senate.

    The upper chamber asked the CBN to ban deductions from MDAs, but should be paid from a central pool.

    The Senate said all monies realised from TSA operations should be provided to be appropriated in 2016.

  • Senate seeks termination of TSA contract with SystemSpecs

    The Senate on Wednesday asked the Central Bank of Nigeria (CBN) to terminate forthwith the 2013 e-payment contract renewal with SystemSpecs.

    The upper chamber also ordered the CBN to disregard the one per cent charge provided in the contract agreement with SystemSpecs.

    As part of its contract with SystemSpecs, the apex bank agreed on the deduction of one per cent charge on all e-collections by SystemSpecs operator of REMITA Platform.

    This is part of 11- point recommendations made by the Senate Joint Committee on Finance, Banking, Insurance and other Financial Institutions and Public Accounts.

    The Senate in plenary adopted the recommendations as presented by Chairman of the Joint Committee, Senator John Owan Enoh.

    The submission of the committee was however not debated as Senate President, Bukola Saraki, ruled that only the recommendations of the committee would be considered.

    The Senate had, during its sitting on November 11, 2015, debated a motion on alleged “abuse and mismanagement of the Treasury Single Account (TSA).

    The upper chamber resolved to, among others, mandate its Joint committee on Finance, Banking, Insurance and other Financial Institutions and Public Accounts to conduct holistic investigation on the matter.

    It specifically mandated the committee to investigate the alleged abuse of the TSA and deduction of N25 billion from accounts of Ministries, Departments and Agencies (MDAs) under the e-payment.

  • TSA hits N2.3tr as 98% of MDAs complies

    TSA hits N2.3tr as 98% of MDAs complies

    • Fed Govt, IMF urge states to adopt TSA system

    The Office of the Accountant-General of the Federation (OAGF), yesterday said it has mopped up N2.3 trillion  into the Treasury Single Account (TSA).

    Its Director of Funds, Mr. Mohammed Dikwa, disclosed this at the opening session of the workshop on TSA in Abuja.

    He said with over  17,000 bank accounts being operated at the federal level in commercial banks, government had no choice but to introduce the TSA which has so far helped in mopping up about N2.3trillion into the various accounts maintained and operated at the  Central Bank of Nigeria (CBN).

    In similar vein, the Accountant-General of the Federation (AGF), Mr.Alhaji Ahmed Idris, said 98 per cent of the Ministries, Departments and Agencies (MDAs) have complied with the TSA.

    He said following government’s February last year directive, all federal MDAs are now on TSA operating their account successfully through the CBN.

    Idris said: “As at December 2015, 726 MDAs, which are responsible for almost 98 per cent of the national budget have complied fully.”

    According to him, the challenges encountered in the adoption of the TSA were entrenched resistance from banks and the MDAs, which the Federal Government has now overcome.

    With the massive compliance, the AGF noted, the new challenge is that of capacity building , and the application of information technology (IT).

    In her opening remarks, the Minister of Finance, Kemi Adeosun, who was represented by Mr. Adeseye Shefuye said the  balance, which changes daily as MDAs remit revenues and make payments, according to the latest reports from CBN exceeded N2.2 Trillion.

    She said: “I can report that work is now ongoing within the Treasury, to determine how much of these funds can potentially be utilised to part fund the 2016 budget and how much relates to pending commitments. This, of course, will reduce the amount to be borrowed.”

    TSA, she said,  has provided government with financial information on the revenues of agencies funded by government and has reduced revenue suppression.

    She noted that the information is being used to drive government’s programme to enforce compliance with the Fiscal Responsibility Act and ensure that revenue generating agencies generate expected surpluses and remit to the Federation Account.

    Mrs Adeosun said: “TSA has eliminated opportunities for brokerage and other corrupt practices that previously encouraged agencies to accumulate funds with commercial banks rather than apply them to their intended uses.