Stats: 3,190,859 members, 7,942,150 topics. Date: Friday, 06 September 2024 at 10:05 PM |
Nairaland Forum / Nairaland / General / Politics / The TSA As A One-stop Platform For Public Revenue (426 Views)
Ihedioha To Sign Order On TSA As Imo Uncovers 250 Accounts Operated By Okorocha / Legislature, Judiciary Shun TSA As Transactions Hit N30trn / Take Ownership Of The TSA Now: Rep Tells FG (2) (3) (4)
(1) (Reply)
The TSA As A One-stop Platform For Public Revenue by ayosmiles(m): 8:21pm On Oct 13, 2017 |
The Treasury Single Account(TSA) has been touted by many as an important instrument in the fight against corruption by the Federal Government. The idea behind it is to unify all government accounts across different banks into one single account so as to ensure smooth record-keeping, transparency and accountability. The TSA came from IMF recommendations to enable the efficient management and usage of government funds. Fragmented systems of handling receipts and payments often lead to loopholes for inefficiency and corruption, making government lose funds in the process. Also, the proliferation of government bank accounts had made it difficult to track government funds and supervise their disbursement. Thus it was difficult for the Nigerian government to declare its financial status and establish its credit worthiness before international financial institutions. It is said that the establishment of the TSA will stop the proliferation of government bank accounts, mop up all public funds from the banking system and promote healthy competition among the MDAs (Ministries, Departments, and Agencies). The TSA is operated by Remita, a technological innovation that channels all funds paid to all commercial and microfinance banks, all government ministries, departments and agencies into the TSA. Remita is a one-stop payment solution that has ensured the seamless flow of funds from all payment platforms into the government coffers and has made it easier to monitor revenue generation. The TSA had been activated in Nigeria since 2012. However, it became imperative in September 2015, barely four months after swearing in the APC government. President Muhamadu Buhari ordered that all government revenue be paid into a single account held by the CBN. Bank compliance was fast. The following day, all banks checked the government accounts with them and emptied the funds therein into the TSA. Presidential spokesman, Femi Adesina explained that all funds due to be paid to the government or its agencies should be deposited into the Treasury Single Account. Despite the initial difficulties in establishing the TSA, it has been met with optimism in many quarters. The Nigerian senate has lauded the initiative, with one lawmaker saying that full compliance with the directive would help in blocking leakages and ensure transparency, and another saying the development would enable banks, which hitherto relied majorly on MDAs, to become more resourceful. The Bankers committee declared support for the policy, almost as soon as it came out. There have been a few arguments against the TSA due to the challenges arising from its adoption. Towards 2016, following presidential directives for banks to remit all public funds to the TSA, over 2 trillion Naira of public funds was suddenly moved out from banks. Due to the massive amount of cash that was suddenly withdrawn from the banking sector, there was no trading between banks for a while as there was no liquidity. One dealer told journalists that trading was currently going on because no bank was willing to put out quotes until there is a clearer direction with the implementation of the Treasury Single Account. This led to disruption in the activities of the banks because liquidity was affected. Public funds make up roughly 10% of cash held by banks. With the loss of public funds, many banks were affected. Nevertheless, these were initial shocks that will gradually dissipate as more money flows into the system. The banks have improved their operations knowing they cannot rely on public funds to shore up their liquidity. Meanwhile, liquidity is gradually returning to the banking system. As banks increase their effort to make up for the loss in liquidity, the total amount of money in the system will increase because money will flow in to replace public funds that have been taken out. Despite challenges associated with its adoption in Nigeria, the TSA has several benefits. It enables the efficient monitoring of the allocation of resources and generation of revenue. It is saving the CBN the headache of always mopping cash from banks due to the money lodged several bank accounts that have been overlooked. This will ultimately lead to reduction in government spending. Furthermore, the adoption of the TSA will increase transparency within the MDAs and the government. The Remita platform has record keeping features that document all payments, therefore secret payments without the knowledge of the government would be impossible. Government can also easily monitor the money in its account at any given time. This will reduce the cases of trapped funds in unknown obscure accounts while government borrows money for other operations. TSA will also put a stop to the issue of some public officers secretly depositing public funds in the bank to yield some interest for them, at the expense of what the money was originally meant for. Moreover, it will stimulate accurate reporting by the government and all MDAs. Some government revenue generating companies don’t even know how much money they have generated because they are operating several accounts. TSA focuses all revenue generation on a single platform with excellent record keeping activities so that government revenue can be easily calculated. One sector in Nigeria that is showing pessimism to the TSA is Academics. Universities are saying that despite its benefits, it makes it difficult to access funds for research. The Association of Academic Staff Union of Universities(ASUU) complained that the TSA is blocking the access of lecturers to some international funds. This is because when these funds go into the TSA, it becomes difficult to access them urgently when they are needed. Nevertheless, the benefits of the policy for the educational system are much more than the initial difficulties faced in implementing it. With a little flexibility, the TSA will bring maximum benefits to the education sector. The National Universities Commission(NUC) has already advised universities in the country to key into the process. The Remita-operated TSA will ensure that correct data is obtained on any project carried out in the universities. Statistics such as the number of staff, number of students, and total school fees paid will easily be determined. Lastly, the TSA will make a huge impact on the private sector also, especially as it interfaces with the public sector. Today, government contractors are not being paid from the MDAs but directly from the CBN, with a transaction that leaves a trail of records. This will make it easier for contractors to receive their payments and ultimately fast track the ‘Ease of doing Business’ Initiative of the government. Despite its many challenges and loud antagonists, the TSA has come to stay.
|
(1) (Reply)
Senator Ben Bruce Seriously Attacks Nigerian Senators And Their Children / God Bless Pmb1523 / 3 Months After Swearing-in, No Cabinet In 57 Lagos LGAs
(Go Up)
Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health religion celebs tv-movies music-radio literature webmasters programming techmarket Links: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) Nairaland - Copyright © 2005 - 2024 Oluwaseun Osewa. All rights reserved. See How To Advertise. 17 |