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Illegal Withdrawals From Excess Crude Fund

Posted by Guardian on 2006/06/18 | Views: 409 |

Illegal Withdrawals From Excess Crude Fund


Although the excess crude oil account was promoted by government as a surplus fund to be kept intact for the rainy day, President Olusegun Obasanjo...

Although the excess crude oil account was promoted by government as a surplus fund to be kept intact for the rainy day, President Olusegun Obasanjo a foil to the Contingencies Fund for the Federation. And when legislators, who have the constitutional responsibility for appropriating funds for specific projects, question the irregularity, the President tenders belated explanations. That approach is both a negation of government's due process policy and a violation of the Oath of Office to which Mr. President solemnly swore.

Thus in a letter dated June 5, the President decided to bring to the notice of the House of Representatives "details of supplementary expenditure incurred last March from the Excess Crude Account to facilitate the successful conclusion of the 2006 national population census". There was a follow-up letter, the next day to the Senate in which Finance Minister Ngozi Okonjo-Iweala listed all withdrawals effected to date from the excess crude oil account. It will be recalled that initial disbursement in respect of the Niger Delta power projects and Paris Club debt exit payment like the extension of the census enumeration exercise were made without due and prior legislative authorisation.

Now, written more than two months after funds had been released, the President's letter was really an outflanking move to avert legislative stricture that was brewing. Its tone and contents show an unrepentant President defending this sidelining of federal legislators under the pretext of meeting an urgent need and co-opting in their stead state governors, local government chairmen and selected heads of federal agencies as appropriation consultants and co-usurpers of the legislative responsibility for authorising withdrawals from the excess crude account. For the executive to seek to usurp the duties of another arm of government is to undermine a key institution of state.

The executive may well be persuaded that it harboured good intentions. However, the argument that any of the contentious withdrawals was occasioned by the need to expedite action is unconvincing. For example, any expectation by census planners that census enumeration would proceed flawlessly and be concluded within the initial time frame was misconceived. Budgetary provisions should have been made for the various projects which were clearly foreseeable.

Since there are tractable ways of dealing with any budgetary shortfall, it is difficult to understand why the executive has chosen to stoutly justify its unauthorised withdrawals from a fund that is part and parcel of the Consolidated Revenue Fund of the Federation. Ours is a written constitution which has spelt out the powers of the executive, the legislature and the judiciary. The federal executive therefore cannot claim ignorance of sections 80-89 of the 1999 Constitution which deal with powers and control over public funds.

The bone of contention, the excess crude oil account, is strange to the Constitution: it is not a substitute for a Contingencies Fund just as it lacks sound economic basis as we had pointed out elsewhere. Even if we assume that the oil fund serves as Contingencies Fund for the Federation and that the expenditures were truly unforeseen, section 83 (2) of the present Constitution prescribes that Supplementary Appropriation Bills be promptly introduced to cover such expenditures.

Hence resort to belated explanatory letters by the Presidency says one thing: the Minister of Finance and top Civil Servants in relevant agencies have not been alive to their responsibility. For, once the President gives a financial directive that runs foul of the Constitution, they are expected to exercise the initiative of immediately raising a memo and drawing up the requisite supplementary estimates for Mr. President to transmit to the National Assembly as a Supplementary Appropriation Bill. Or did Mr. President ignore such internal memos while insisting on doing things in his own way and against the law?

Surely, if political appointees and top bureaucrats had offered sound advice and necessary support, these past seven years under an administration that has been advocating due process and pushing endless reforms should have produced an enduring legacy of strengthened institutions instead of the reverse that appears to be the case.

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Fay(Katy, Texas, US)says...

Actually translates to bravehearted.