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Reps to probe Finance Ministry, CBN over $500 million extra budgetary expenditure

The House of Representatives Tuesday resolved to investigate the Federal Ministry of Finance and the Central Bank of Nigeria (CBN) over extra budgetary expenditure of over $500 million from Nigeria Export Supervision Scheme Fund.

It also resolved to probe the spending by the CBN and the Ministry of Finance over another extra-budgetary spending of about N700 billion from the same fund in contravention of section 80 of the constitution which stipulates that such funds must be appropriated before use.

The House directed its Committee on Public Account to carry out the investigation and report back within four weeks for further legislative action.

The Green Chamber took these decisions, following the adoption of a motion of urgent public importance sponsored by Abdullahi Abdulkadir (APC, Bauchi).

Moving the motion, Abdulkadir said the pre-shipment Inspection of Export Act of 1966 requires that prior to the export of any goods from Nigeria, it must be inspected by an Inspection Agent, which in turn is required to issue, where appropriate, a Clean Certificate of inspection to the overseas buyer of the goods.

The lawmaker noted that both oil and non-oil export are liable to pre shipment inspection in respect of their quality, quantity and price while the Inspection Agent is required to issue to the Exporter a Provisional Certificate of inspection.

He stated that upon loading of the goods and conduct of a final inspection, where the goods satisfy the required thresholds as to quantity, quality and price, the inspection Agent will issue a Clean Certificate of inspection.

The Deputy Chairman, House Committee on Public Accounts emphasized that in order to engender transparency in the administration of the Pre shipment inspection programme, the Act requires the Inspection Agent to send an original copy of the Clean Certificate of Inspection to the Federal Ministry of Finance (Federal Ministry of Finance, Budget and National Planning’, referred as ‘Federal Ministry of Finance) the Nigeria Customs Service, the Nigerian Ports Authority, the exporter, the exporter’s bank for transmission to the buyer’s bank overseas and the Central Bank of Nigeria.

He said, the inspection Agent is obligated to furnish, weekly reports of successfully conducted pre shipment inspection to the Federal Ministry of Finance, Federal Ministry of Commerce (now Federal Ministry of Trade and Investment) and the Central Bank of Nigeria

According to him the Act requires the payment of a levy by exporters goods as pre shipment inspection levy, which will be paid into a special fund from which the remuneration, fees and other charges of the inspection Agents are to be defrayed. in addition, section 14(3) “of the Act requires that any balance remaining in the special fund is to be used for funding the pre-shipment inspection programme.

Abdulkadir further said section 80(1) & (2) of the Constitution requires revenue that accrue to the Federation, which is not constitutionally required to be paid into a specific fund, must be paid into the Consolidated Revenue Fund, while the Act creates a Special Fund, the balances in that Fund is exempted from being paid to the Consolidated Revenue Fund.

He explained that even though the Fund is exempted from being remitted into the Consolidated Revenue Fund, section 80(4) of the Constitution requires that spending/expenditure from such Special Fund cannot be done without any appropriation by the National Assembly.

Abdulkadir noted that Section 80(4) of the Constitution states as follows “No moneys shall be withdrawn from the Consolidated Revenue Fund or any other public fund 0f the Federation, except in the manner prescribed by the National Assembly.”

He alleged that for the past 10 years, the Federal Ministry of Finance and the Central Bank of Nigeria have expended from the Fund without the National Assembly appropriating for such spending.

The Bauchi legislator said: “It is widely known that both the Federal Ministry of Finance and the Central Bank of Nigeria utilise the funds in the Special Fund as a sort of slush fund.

“The action constitutes a gross violation of the letters and spirit of the Constitution of the Federal Republic of Nigeria 1999, the Fiscal Responsibility Act 2007, the transparency intents embedded in the Pre shipment Inspection of Export Act 1966 and the Finance (Control and Management) Act.

“The extra-statutory deductions and illegal expenditure from this fund has cost Nigeria over 700 billion Naira within the last ten years. Recently over 500 million United States Dollar was expended from the Fund without any budgetary appropriation. In addition the Federal Ministry of Finance has failed and refused to render its account in respect of the NESS Fund to the Auditor General for the Federation.

“If urgent steps are not taken to investigate and audit the NESS Fund, Nigeria may risk the strong possibility of losing more money and the Central Bank of Nigeria and the Ministry of Finance may continue to use this Fund as a slush fund with the chances of diverting it to personal use without any public scrutiny”.

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