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Published On: Thu, Apr 24th, 2014

Scrapping Financial Reporting Council, step in the wrong direction – Centre for Social Justice

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By Aminu Imam

The Executive Director of Centre for Social Justice, Barrister Eze Onyekwere has appealed to the Federal Government to reconsider the White Paper recommendation scrapping of the Financial reporting Council (FRC) and the transfer of the powers and duties of the Commission to the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC).

Addressing a press conference in Abuja, yesterday, Barrister Onyekwere said, “Scrapping the FRC and transferring its functions to another agency that has a primary political function, not centred on fiscal governance will defeat the aims and objectives of the FRA. It will therefore leave the FRA without a sound body to oversee its implementation on a day-to-day basis.

Barrister Onyekwere further stated that, “Many states have enacted the Fiscal Responsibility Law while others are in the process of enacting one. State-level FRCs has been set up and they look up to the experience of the federal FRC for guidance and mentoring. Scrapping the FRC sends a very powerful wrong message to the states and the message is; scrap your own FRCs and fiscal responsibility is no longer in vogue.

“I do not believe this is the message the Goodluck administration wants to send out, but inadvertently, that is the core of the message coming out from this white paper. And states will follow suit if the FRC is eventually scraped. Further, section 54 of the FRA states that the FG may provide technical and financial assistance to states and local governments that adopt similar fiscal responsibility legislation along the same lines as the FRA for the modernisation of their tax, financial and asset administration. Considering that financial assistance is ruled out by this move; pray, is this the technical assistance anticipated by the section?” he queried.

“If we seek to prune down the cost of governance, we will not be closing an FRC which in five years did not get a cumulative budgetary allocation of more than N3.735billion but on whose prompting, scheduled corporations paid operating surplus as follows: N17.097b in 2009; N36.766b in 2010; N71.060b in 2011 and N95.366b in 2012. We need more of such FRCs rather than rationalising the existing one.

The FRC is central and vital to our quest for improvements in fiscal governance. It will be a dangerous mistake to scrap this agency and to pretend that RMAFC is in a position to oversee the implementation of the FRA. It is not too late for FGN to retrace its steps. We urge Mr. President to reconsider this White Paper recommendation on the FRC”, he further stated.


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