The President, Major General Muhammadu Buhari (retd.) during the presentation of the 2023 budget at the National Assembly.
Some Ministries, Departments and Agencies have earmarked over N204.12 million as bank charges in the 2023 appropriation bill.
This is coming at a time when many Nigerians have expressed worries over plans by the Federal Government to finance the 2023 budget deficit of N10.78 trillion by borrowing, selling the national assets and via project-specific loans.
Consequently, financial experts who spoke to Sunday PUNCH on the budget for bank charges called for financial audits to be carried out on the affected MDAs.
Findings by The PUNCH revealed that the Ministry of Police Formations and Commands plans to spend over N41 million as bank changes for next year. This figure quadrupled the budget for bank charges of the entire Police Service Ministry.
The Federal Ministry of Police Affairs budgeted about N874,896 for bank fee while over N3.5 million will be spent on bank fees by the Nigeria Police Academy, Wudil, Kano.
Similarly, over N85.512 million is proposed to be spent by the MDAs as well as foreign missions under the Ministry of Foreign Affairs along with the Federal Ministry of Information and Culture receiving N3.163 million out of the figure as bank charges.
In the same vein, the Federal Radio Corporation will be spending N5.71 million while the National Commission for Museum and Monuments has proposed N4.58 million for bank charges.
Also, the National Commission for Museum and Monuments plans to spend N4.58 million while the Federal Character Commission will spend N5.18 million for bank charges.
The National Council of Arts and Culture will spend N996,000 on bank charges.
Also, the National Identity Management Commission has proposed N14.24 million for Bank charges in the 2023 appropriation bills.
Others such as Economic and Financial Crimes Commission, Nigeria Extractive Industries Transparency Initiative, Ministry of Defence (Hqts), Defence Headquarters, Nigerian Airforce, Nigerian Defence College, Command and Staff College, Jaji, Defence Missions and Nigerian Institute of International Affairs are planning to spend N39,042 million on bank charges.
Speaking with our correspondent, the Managing Director and Chief Executive Officer, SD&D Capital Management Limited, Mr Idakolo Gbolade, said bank charges were padded to accrue commensurate returns to senior officers managing the accounts.
According to him, “This is the reason for the over-bloated national budget and budget deficit,” he said.
Idakolo said that the practice could be curtailed by ensuring that MDAs accounts were designated as government accounts, which would not attract charges.
He noted that “We have seen in most instances that these charges are padded to ensure commensurate returns to senior officers in charge of running these accounts.
“This practice of padding and many more unwholesome practices increases the budget deficits.
“These practices can be curtailed by ensuring MDA accounts in banks are designated as government accounts that must not attract charges like maintenance fees and sundry charges due to the amount of funds passing the accounts regularly.
“These concessions are already in place by banks for organisation volumes with banks and I see no reason why it cannot be extended to government accounts in the banks,” he stated.
On his part, an economist and the Chairman of Chartered Institute of Bankers of Nigeria (CIBN), Abuja branch, Prof. Uche Uwaleke, called for a special audit of the MDAs’ 2022 transactions to justify the budget.
According to him, “I think the starting point is to carry out a thorough audit of their bank transactions in 2022 in order to determine the justification for what they have budgeted for in 2023.
“The amount involved is huge despite the introduction of TSA that requires all MDAs to consolidate all receipts with the CBN, which automatically eliminates some charges.
“The special audit, by private audit firms — not the Office of Auditor General— becomes imperative against the backdrop of the fact that some banks are notorious for subjecting the accounts of MDAs to excess charges sometimes in collusion with corrupt government officials,” he stated.
