Practitioners agree on how to beef up fiscal accountability in Nigeria

Forum president George Anderson, right, shows Forum learning materials to Nigeria’s Minister of Planning, Dr. Shamsadeen Usman. Mr. Anderson was in Nigeria for meetings and to participate in a roundtable discussion on fiscal responsibility.

The Forum of Federations held a Roundtable on Intergovernmental Fiscal Coordination and Accountability in Abuja on the 19th of June 2010 as part of its project on fiscal responsibility, accountability and transparency in federations, which is being led by Professor Lars Feld of the University of Heidelberg in Germany.

Twenty senior policy makers and practitioners exchanged views on issues, challenges and opportunities in Nigeria’s relevant fiscal practices and to considered potential specific initiatives for Nigeria to benefit fully from the Forum’s project.

Participants were drawn from key organisations, such as the Fiscal Responsibility Commission, the Revenue Mobilization Allocation and Fiscal Commission, the Debt Management Office, as well as from civil society organisations and academia.

In his lead presentation, Professor Feld discussed the fiscal responsibility regimes in Germany, Switzerland and Brazil, all of which have introduced fiscal responsibility reforms in reaction to crises in their fiscal management Germany introduced a new debt regime, Switzerland applied debt brakes, and Brazil enacted far reaching laws on fiscal responsibility with penalties of imprisonment and fine for defaulting officials.

One recurring theme in all three countries was their desire to reduce their budget deficits.

Dr Mansur Muhtar, who was recently Minister of Finance in Nigeria, provided practical insights into the evolution of the Nigerian fiscal responsibility regime.

He outlined the difficulties in getting state buy-ins, the limitations imposed by the constitution in the area of intergovernmental oversight and the weak sanction regime in the law.

Representative from the various agencies shared their experiences in implementing fiscal discipline. It was agreed that the fiscal regime in Nigeria is faced with the three problems of lack of capacity, a weak implementation framework and inadequate compliance mechanisms.

It was agreed that key agencies involved in fiscal management need to be strengthened structurally and financially. The laws should also be amended to give greater oversight functions to fiscal managers especially at the state level and enormous resource be made available for public awareness and sensitization.

It was also emphasized that there are no best practices but rather that Nigeria should develop for itself a system that works and which commands the commitment of all. Such a system can be evolved drawing lessons from other federations.

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