TSA: Putting Nigeria on Track for Digital Governance


Omololu Martins

The Nigerian government is no stranger to wasteful spending and corruption in its public sector. At the last count, over 40,000 ghost workers have been flushed out of Ministries, Departments and Agencies (MDAs) and a record N20 billion saved from the federal government’s monthly wage bill following its efforts to digitise financial management in the public sector.

“What we are doing is looking at ways we can generate more savings through efficient utilisation of funds, while the savings realised through efficiency are channelled to funding infrastructure and social welfare spending,” Ministry of Finance Permanent Secretary Mahmoud Dutse told newsmen recently.

Nigeria is not alone. Other forward-looking nations of the world are turning to Information and Communication Technology (ICT) to drive operational efficiency and accountability in governance. Last year, the United States, tripled investments in ICT accelerators and incubator programmes, while the United Kingdom made direct investment of 1.1 billion pounds in Cyber Security.

Also, South Africa, Mauritius, Seychelles, Morocco and Rwanda made the World Economic Forum’s (WEF) list of African countries that have integrated ICT in their socio-economic development.

Electronic governance (e-Governance) is the application of Information and Communication Technology (ICT) for delivering government services, exchange of information and communication transactions. In keeping with this, an August 2016 McKinsey Report emphasises that evidence-based governance is the future and will increase in the run-up to 2020.

The report, tagged ‘Policy in the Data Age: Data Enablement for the Common Good’, explains that digitalised governance “gives governments the tool they need to be more efficient, effective, and transparent while enabling a significant change in public-policy performance management across the entire spectrum of government activities.”

Good enough, Nigeria is making progress along this line. On September 15, 2015, the country adopted the Treasury Single Account (TSA) policy, praised at home and abroad for returning over N4.3 trillion cash assets to the country’s treasury.

The policy – initiated by the President Goodluck Jonathan administration but implemented by the current one – stipulates that government funds generated from taxes, levies and tariffs should be deposited in the Central Bank of Nigeria (CBN) and disbursement subject to stringent procedures to ensure accountability in the management of government cash resources.

Analysts say President Buhari adopted the policy following claims that he met an empty treasury on assumption of office, which hampered his efforts to deliver on his campaign promises. Ever since, the government has identified and closed over 17,000 MDA accounts and transferred the recovered funds to a Consolidated Revenue Account (TSA) managed by the CBN.

Earlier this year, Minister of Information Lai Mohammed went to town to declare that the TSA had helped the President Buhari administration’s fight against corruption, flushed out ghost workers and saved the economy from imminent collapse.

Though successful, some industry watchers wonder why the adoption of the policy was delayed despite being in line with Section 80 (1) of the 1999 Constitution. The stipulation is that all revenues raised or received by the Federation…shall be paid into and form one Consolidated Revenue Fund (CRF) of the Federation.

The TSA is powered by Remita, an indigenous software that supports the collection and remittance of all government revenues into the Consolidated Account.

Typically, corporations and individuals pay their taxes or levies to the government via the bank, online or their ATMs. Whatever payment channel they choose is routed through the Remita payment gateway to the CBN. The government then withdraws from these funds to pay its MDAs and contractors as subventions, salaries, allowances or budget allocations.

According to a McKinsey report for September 2016, digital financial systems such as the TSA reduce inequality, poverty and government corruption, while creating about 95 million new jobs. The report emphasises that digital payments and electronic records can potentially save governments about $110 billion a year because the system is built to prevent diversion of funds meant for developmental and other projects.

It says: “Billions of people across emerging economies possess the mobile handset that can connect directly into the national payments system. They are just waiting for governments and businesses to wire up the infrastructure and create the products they need.”

Currently, the TSA is receiving a lot of hard knocks by players across the economic spectrum for making revolutionary changes in payment and collection as they know it. But if the recent McKinsey report is anything to go by, the policy may just be the most effective tool that can include Nigeria in the comity of nations that have turned their fortunes around through e-Governance.

Omololu is an ICT practitioner