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BAIL OUT FUNDS: FG draws battle line, appoints auditing firms for states

BAIL OUT FUNDS: FG draws battle line, appoints auditing firms for states

A battle of wit is about to commence as the Federal Government concludes plans to appoint auditing firms to review the financial management mechanisms of the 36 states and the Federal Capital Territory (FCT) Abuja.

It is said to be a fulfillment of the federal Government’s vow to monitor the use of the various bailout funds extended to them to pay wages.

A statement issued by the Federal Ministry of Finance on Tuesday confirmed that the appointment of the firms was part of the ongoing exercise, which commenced in June 2016 after the last tranche of bailout fund request was released to some of the states, but is being extended for other reasons.

But some of the state government officials have described the move as an indirect way of the central government lording it over them, against the doctrine of separation of powers as envisaged by the Nigerian Constitution.

Read also: Report exposes attempt by States to hide breakdown of N388bn refund from FG

According to the ministry’s director of information, Salisu Danbatta, the need to have independent firms review the states’ finance management is to ensure that anticipated landmark objectives are achieved by the various governments.

Danbattta named some of the auditing outfits to include, PWC, KPMG, Ernst & Young, PKF, Muhtari Dangana & Co/S.S. Afemikhe & Co, Ahmed Zakari and Co/Ijewere & Co.

He said their terms of reference would include, evaluating the implementation of the 22-point Fiscal Sustainability Plan, with the aim of identifying any challenge that the states and the FCT have as to enable them access the Budget Support Facility (BSF) in-built in the budget of 2017.

The 510 billion BSF, said to be targeted at states to help them cushion the effect of the economic recession plaguing the country can only be accessed by states that receive clean bill of records by the auditing firms.

Reports say only about 20 per cent of the states have good finance management plans that could enable them access any financial support from the Federal Government.

However, some constitutional lawyers differed over the idea of having the Federal Government monitor state government activities, which they said amounted to teleguiding them against the provisions of the constitution.

Mr. Abiodun Fadeyi, a principal partner with FKS Chambers, an Ikeja-based law outfit said the Federal Government has no powers to wade into the affairs of any state government, irrespective of any device.

“If this is allowed to stand, the government at the centre could one day demand states to present their budgets for vetting. So it is unconstitutional”

Mrs. Roselyn Nnamani, another lawyer, said though the states called for this when they went to the Federal Government for bailout funds to run their administration, still there should be a clear separation of functions as not to allow any tier of governments have upper hands in any way.

However, Finance Minster, Kemi Adeosun, has insisted that without evaluating and verifying the performance of the states, it would be impossible monitoring the level of achievement of their fiscal sustainability programmes.



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Emma Eke