Since the introduction of the Treasury Single Account in September 2015, the Federal Government has saved a total of N128bn from charges imposed by banks for managing funds belonging to the Ministries, Departments and Agencies of the government.
The amount, according to investigations, represents the various charges and account maintenance fees, which where hitherto imposed by the Deposit Money Banks for holding government funds.
Findings at the Office of the Accountant-General of the Federation showed that before the scheme commenced, the government was incurring about N4bn monthly to maintain its various accounts in banks.
Vice-President Yemi Osinbajo on Wednesday also confirmed the N4bn monthly savings through the TSA while speaking at the opening session of the Chartered Institute of Taxation of Nigeria.
He had said, “We have aggressively expanded the implementation of the Treasury Single Account and the Integrated Personnel Payroll Information System, both designed to ensure that public funds are more transparently managed and spent.
“The TSA’s unified system of bank accounts domiciled in the Central Bank of Nigeria has proven to be far more transparent and cost-effective than the old scenario in which government agencies maintained thousands of accounts across various commercial banks.
“Because of the TSA, the Federal Government realises monthly savings of at least N4bn, which would have gone on commercial bank charges.”
There are 32 months between September 2015 and April this year. And with monthly savings of N4bn, the total amount so far saved through the implementation of the scheme is N128bn.
The initiative, which commenced fully in September 2015, has been complied with by over 900 agencies of government with 20,000 bank accounts closed.
It was learnt that over N8tn had been moved from banks to the CBN.
It was also gathered that the initiative had assisted the Federal Government to close over 17,000 bank accounts.
Our correspondent learnt that since the implementation of the programme three years ago, a total of 1,674 MDAs had been enrolled into the TSA platform.
The Accountant General of the Federation, Alhaji Ahmed Idris, last month said over N70bn belonging to the Federal Government had been lost to distressed banks in Nigeria.
In a presentation titled ‘TSA: A veritable tool for transparency and accountability in public financial management’, he said that the TSA policy had been able to assist the government to remove a lot of impediments affecting the efficiency of public finance.
He said, “The TSA covers all funds budgetary or extra budgetary including loans, grants and donations under the control of all the Federal Government’s entities irrespective of arm of government. All collections are done through electronic channels and we have recorded N8.9tn gross inflow to date with 1,674 MDAs enrolled.
“The TSA is intended to address multiple bank accounts of over 17,000, countless dormant accounts with huge balances, inability to determine consolidated cash position of government, borrowing and incurring charges when there are idle balances in the MDAs’ accounts, delayed remittance of revenue and collections and over N70bn of the FG funds lost to failed banks.”
The AGF said that the government was enjoying a lot of benefits from the implementation of the TSA policy.
For instance, he stated that through the policy, the government had been able to block leakages and abuses, which had characterised the public sector before its commencement in September 2015.
Apart from blocking leakages, Idris said the TSA initiative had assisted the government to overcome the burden of indiscriminate borrowings by the MDAs, thus saving the government a lot of bank charges associated with these borrowings.
He said despite the successes so far recorded, there were still some institutional and operational challenges affecting the scheme.
He gave some of them as capacity deficit, lack of clarity in stakeholders’ roles, conflicting directives and signals, resistance based on limited understanding of the TSA and non-enrolment of key arms of government.
Others are lump sum transfer of the MDAs’ balances by the Deposit Money Banks, difficulty in accessing bank statements and associated reconciliation issues, and multiplicity of sub-accounts.
