NIGERIA has some laws ordinary Nigerians would wonder when they were made. One of them is the Fiscal Responsibility Act, FRA, a 2007 law that expects prudent management of public finances from governments and their agencies.
The law is observed in breach as cases of outright malfeasance show. The FRA was meant to track and prevent conducts that were likely to result in abuses.
Reports that the Federal Government has secured a World Bank loan of S1bn to finance power, education, and HIV/AIDS projects should worry anyone who knows about the FRA.
Government has chosen areas of our national live that we agree deserve urgent attention, but it is a poor excuse for wanton disobedience of the law. There are many grounds to be apprehensive.
The loan is repayable over 35 to 40 years with a 10-year grace period. This effectively puts the burden of repaying the loan on future administrations. The other is the penchant of the States and local government councils to imitate the Federal Government.
When the Federal Government disobeys the law, it provides bad leadership for the two other tiers of government. The World Bank loan affronts provisions of the Fiscal Responsibility.
Section 44 (1) of the FRA states that, â€œAny government in the Federation or its agencies and corporations desirous of borrowing shall, specify the purpose for which the borrowing is intended and present a cost benefit analysis, detailing the economic and social benefits of the purpose for which the intended borrowing is to be appliedâ€.
According to Subsection (2), â€œAny borrowing requires the existence of prior authorisation in the Appropriation Act or Law for the purpose for which the borrowing is to be utilisedâ€.
There is no evidence in the 2009 Appropriation Act that Government proposed a $1 billion loan for the stated purposes. How then can the demands of the FRA be met in this circumstance? For government to announce the approval of the loan, it must have applied to the World Bank, when did it intend to inform the National Assembly? Without meeting provisions of the FRA, the loan could be wasted like earlier ones.
It is remarkable that President Umaru Musa Yarâ€™Adua who signed this law in December 2007 is the one violating it. More subtle violations of the law had gone unnoticed.
A year after signing the law, the President presented the members of the Commission to the National Assembly for screening. The Commission has not been inaugurated, nor allocated any offices for its assignment. Effectively, the Commission does not exist.
Section 48 (1) of the FRA urges government â€œto ensure that its fiscal and financial affairs are conducted in a transparent manner and accordingly ensure full and timely disclosure and wide publication of all transactions and decisions involving public revenues and expenditure and their implications for its financesâ€.
Laws are useless if they are not enforced. The National Assembly must stop fragrant violation of our laws â€“ this loan is one violation too many.