‘We Can Come up with Better Laws to Enhance Local Business Opportunities’

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James Faleke

Udora Orizu holds a discussion with Chairman, House Committee on Finance, Hon. James Faleke Udora Orizu, who represents Ikeja Federal Constituency of Lagos State on how the country can generate more revenue in the view of the current crisis in the global oil market

The President has asked for an amendment to the new Finance Act, what are we looking at?

 

The Finance Act letter was read on the floor. I’m yet to get the details. I can hardly comment on what I don’t have full details of. But if what I heard on the floor is anything to go by, it’s an amendment to favour the Agric Sector and other areas of consumption in terms of the VAT.

There are concerns raised that some MDA’s are not ready to comply with the new tax, they are arguing that it’s based on the former 5% VAT

I think that the moment a law is made and enters into a gazette, the agency concerned is supposed to write letters to all the revenue generating agencies to tell them the effective date of commencement. It’s not just enough to think that Mr. President has signed so everyone must comply. The FIRS on its own should write a letter of commencement notifying them and attaching the gazettes of the law. Nigerians don’t like paying taxes so you have to show them what the law says and if they refuse to pay then, you take appropriate action.

Going by your committee that most MDAs should refund government money from 2014 till date, do you think those remittances will be able to finance our 2020 budget?

In Committee of Finance, our responsibility is to ensure that all revenue generating agencies of government and private companies pay required revenue. It’s not only government agencies, wherever our tax is hidden must be brought out by the Committee. It’s the responsibility of FIRS to ensure that everyone pays what they are supposed to pay. We discovered that majority of our government agencies don’t remit what they are supposed to remit and by so doing, they act as a government on their own; take in the income and spend it and still depend on government to pay their salaries. I will give an instance. A particular agency whose salary is N90 million per month, the total remittance from that agency is about N2.7 million per annum. And I asked if all agencies are like you, where do you expect government to pay from? These are some of the issues. It’s not that the N2.7million was their maximum revenue generated. They generated loads of money and they just remit N2.7million and they say it’s because it’s operating surplus. When we looked at the Fiscal Responsibility Act, we said, look this idea of operating surplus will not help Nigeria because these agencies will never declare surplus. These government agencies don’t have surplus they declare losses and so which means nothing will come in for government, until we started this review. We took it upon ourselves as a committee to see how we can help Nigeria to more like from oil revenue. We didn’t envisage what is happening now. There was no coronavirus. Since we started so many of the agencies have remitted their arrears. We have been able to point out what they owe and so many of them have come with new treasury receipts to show us how much they remitted, which means these funds are there. In the view of this oil problem and volatile oil prices, we need to look inwards. The money in the system if properly managed is more than enough to take care of our needs. I have seen it with the few agencies that we have checked, when you put actual revenue generated aggregate them together you will see that it’s in billions if not trillions of Naira. We have not gone to the oil sector, we have not touched NNPC, NIMASA, CBN, the big ones, we are just doing these small ones first, when you look at the amount being generated, we said look you’re not being fair to this country. As a committee, we hope to come up with an amendment to the Fiscal Responsibility Act to say that every agency of government should remit fund generated to CRF account and then bring their budget to access the money. We can then say if you fail to remit, the law will take charge. That’s what we are looking at.

Now that we know for a fact that the oil sector cannot sustain the country with the break out of COVID-19, isn’t it time to diversify and source for revenue from other areas?

This government has made efforts at diversification of the economy. I agree that we can come up with better laws to enhance local business opportunities that we have. That is why I’m concerned about electricity which is a major impetus to our being up and running as a country.

In line with the current reality, don’t you think it’s time to streamline agencies and ministries?

From my experience of four weeks of looking at these agencies, I completely agree that there’s a major need to streamline them. We have to merge where necessary. We have an agency for example that has a staff strength of 1500 and has contributed absolutely nothing. It’s a research institute and we have not seen the effect. We have agencies that have been in existence since 1988, and they have not come out with one research, to be sold either to investors or to help Nigeria. The agencies are just set up for the staff of that agency, doing nothing just collecting money. I agree and I support that idea if we must move forward.

On the public outcry about the new loan, people are saying do we really need this loan? They are also asking about the utilization of the previous loans and that the National Assembly should address that?

I’m not the Chairman of Aids and Loans in the House, but I know that this new loan is project tied. It’s not just loan you can use in the open. They have been in the process for a longtime, evaluation done, process done, repayment agreed before they finally agreed so if we don’t access it the cost of funds will continue to go up. Today, as at the time of this discussion the Dollar was exchanging for N305; in the black market, it is about N400 to one Dollar. What we are supposed to do today, if we don’t do and wait till tomorrow, tomorrow might be more expensive and too late. As the representatives of the people, we need to know how the loans are being used, it’s part of our oversight responsibility, and I think that the National Assembly, especially the House of Representatives has been doing that.

What do you have to say about the protest over the exclusion of South-east as beneficiary of the loan?

We passed an MTEF. There was an MTEF approved before the 2020 budget, the MTEF clearly indicates the sources of funding of that budget and that loan aspect is there both local and international. If the government in ensuring that they achieve this budget is now trying to access that, why should we say it’s not good? To me, the sources of funding of government, there is your income and when you compare your income to what you want to spend, you look for it via loan and that is exactly what the government is doing. On the exclusion of South-east people, I can’t say they are excluded, when you see government borrowing money to build roads, even in South-east, I can also come from another area and say that I’m excluded. I know that the Federal Government yesterday approved about over N19 billion for 9 Mile road in the South-east, it’s part of it, I also know that government has borrowed money to do the Second Niger Bridge, it’s also in the East. When all these things were going on, North-west wasn’t complaining, South-west didn’t complain. I think we should not be sentimental as to what must come to my area. I agree that if the loan is more encompassing, there will be less concern, and I have no objection to inclusion of all the areas, but we should not be tribalistic to development.

What do you have to say about the petition to the House by your colleague Hon. Henry Nwawuba regarding the loan?

As for the petition by the South-east elite presented by my colleague Hon. Henry Nwawuba, I don’t see the section of the Fiscal Responsibility Act that he was referring to. He never expatiated. He said the elite of the East wrote a petition and he was presenting the petition on behalf of the elite of the East. The elite as far we are concerned are not registered. They are unknown to law. Mr. Speaker, of course, asked if he was representing the elite or poor people. I think the bottom line is that we actually try to ensure that the loan is for all, because as Nigerians everybody will pay for it, same way everybody will pay for Second Niger Bridge construction, everybody will pay for the cost of  all the airports being constructed, the Enugu airport etc, Nigeria will pay for it. Honestly speaking, like the Chairman Aviation has been on aviation people to complete the Enugu Airport and they have to raise funds to do that, it is also part of it. The issue here is that the funds available are not enough and as Finance Committee, our best bet is to ensure that we follow up with all the people who are supposed to pay the funds, and that brings me to the motion that was moved by us last week in the area of misuse of forex allocation. It also gears towards enhancing the system and revenues generated into Nigeria.

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The money in the system if properly managed is more than enough to take care of our needs. I have seen it with the few agencies that we have checked, when you put actual revenue generated aggregate them together you will see that it’s in billions if not trillions of Naira. We have not gone to the oil sector, we have not touched NNPC, NIMASA, CBN, the big ones, we are just doing these small ones first, when you look at the amount being generated, we said look you’re not being fair to this country. As a committee, we hope to come up with an amendment to the Fiscal Responsibility Act to say that every agency of government should remit fund generated to CRF account and then bring their budget to access the money.