In a bid to enhance revenue and curtail financial leakages, the Nigerian federal government has instructed the Office of the Accountant General of the Federation (OAGF) to promptly initiate presidential directives enforcing a 50% automatic deduction from the Internally Generated Revenue (IGR) of Federal Government Owned Enterprises (FGOEs). The directive, communicated through a circular dated December 28, 2023, was issued by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun.
The circular, titled “Implementation of the Presidential Directives on 50% Automatic Deduction from Internally Generated Revenue of Federal Government Owned Enterprises (FGOEs),” outlines guidelines for the collection, utilization, and remittance of IGR by federal government agencies and parastatals.
According to the guidelines, Ministries, Departments, and Agencies (MDAs) fully funded through the Annual Federal Government Budget should remit 100% of their IGR to the Sub-Recurrent Account, a sub-component of the Consolidated Revenue Fund (CRF). Partially funded agencies, receiving capital or overhead allocation, are directed to remit 50% of their gross IGR, while all statutory revenues, such as tender fees and sales of government assets, should be remitted in full to the sub-recurrent account.
Self-funded federal agencies that receive no allocation from the federal government budget are also instructed to remit 50% of their gross IGR, along with all statutory revenue, to the sub-recurrent account.
To streamline the implementation, the OAGF is tasked with opening new Treasury Single Account (TSA) sub-accounts for agencies listed on the schedule of the Fiscal Responsibility Act, 2007. The circular emphasizes the need for strict compliance, and accounts currently operated by agencies for revenue collection will be under the control of the Minister of Finance and Coordinating Minister of the Economy and the Accountant-General of the Federation.
The move is aimed at improving revenue generation, fiscal discipline, and transparency, preventing waste and inefficiencies in the management of government financial resources. The circular also includes provisions for disciplinary actions and sanctions against defaulting accounting officers, ensuring accountability and adherence to fiscal responsibility.
As part of the broader effort to strengthen revenue management, the Revenue and Investment Department and the Treasury Single Account Department of the OAGF will supervise and monitor accounts, conducting a monthly review to ensure compliance with approved funds.
In addition to addressing financial leakages, the circular emphasizes the importance of agencies submitting audited financial statements and management accounts within three months after their financial year-end, fostering transparency and accountability in government financial operations.
