Submit 4-year financial report to access 2022 allocation – Reps to CAC

The House of Representatives on Tuesday directed the Corporate Affairs Commission (CAC) to prepare and submit its financial report from 2016 to 2020 to have its budgetary allocation for 2022 approved.

The House through its committee on finance also directed the Budget Office not to entertain any budgetary request from the CAC until the commission clears its records with the committee.

It advised the accountant-general of the federation not to give the agency any budgetary allocation for the 2022 fiscal year until issues regarding its revenue profile are cleared by the committee.

These resolutions were sequel to the ruling of chairman of the committee, James Faleke after interaction with the registrar-general of the CAC, Abubakar Garba at the ongoing hearing on 2022-2024 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).

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The Faleke-led committee faulted the commission for failure to remit any money to the Consolidated Revenue Fund of the Federation between 2016 and 2019 but spending far above the revenue it generated.

The registrar-general, Abubakar had told the lawmakers that revenues generated by CAC over the years were not enough to cover its expenditure; hence it could not make remittances to government treasury.

“Over the years, we have operated in a difficult environment and until last year, our revenue could not support our expenditure. For the first time since our establishment, we were able to record a revenue of N19 billion.

“In 2018, we spent about N12.2 billion while making revenue of N11.2 billion. What happened is that we had to carry over some of the liabilities. These liabilities were mainly pension deductions, tax and other statutory deductions which were not being paid as and when due. That continued until 2020. We had to settle most of the backlog.

“Deductions were being made but they were not remitted to the appropriate quarter because the money was not enough to meet our operations; the same thing with tax. What was happening was that third-party bills were being paid.

“By the provisions of the Fiscal Responsibility Act, we are supposed to spend our revenue to cover our cost and remit the surplus. But we never had any surplus until 2020”.

On plans to increase the agency’s revenue, Garba said a memo has been presented to the federal executive council to make it mandatory for any company engaging in public procurement to provide a letter of understanding from CAC before it can be qualified to do so.

Expressing dissatisfaction with the agency, Faleke said CAC’s budgetary performance in 2021 put it in deficit due to its spending that was unhealthy for the organisation and overall financial status of the country.

“I have worked in private organisations before coming to the House of Reps, and they will always regulate their expenses and not spend beyond what they generate.

“In your case, you borrow money upfront even before the money comes, therefore, you will have to submit your 2016 -2020 financial report before you are granted an audience for 2022 budget”, he said.