By Aaron Ossaij
House of Representatives had queried the office of Accountant General of the Federation (oAGF) for failing to provide evidence of 25 percent of the N6 billion internally revenue generated by Securities and Exchange Commission, (SEC) in 2020.
The lawmakers expressed the concerns during the interactive session with SEC Director General, Mr. Lamido Yuguda on the review of the 2020 to 2022 budget defence and 2023-2025 Medium term Expenditure Framework (MTEF) and Fiscal Policy paper (FPP), chaired by Chairman House Committee on Finance, Hon. Abiodun James Faleke.
Trouble started when Hon. Faleke requested for AGF’s evidence of the N738 million representing the 25 percent of the SEC revenue in 2020, saying: “where is it in your own record?”
“I want to see your own record, not their own record. If you are referring me to their record then you are not suppose to be here.”
The AGF in his response, said: “We have their record but not here but the receipts are issued by us so we can confirm it. Because they are not part of the schedule we are suppose to have today.”
He however reversed himself saying, the AGF delegation did not know that SEC is part of the agencies that would appear before the House Committee on Finance.
In his intervention, the Deputy Chairman, House Committee on Finance, Hon. Saidu Abdullahi said: “oAGF you’re suppose to know, this was actually in the new and you’ve been part of us since we started this session.”
“If you look at our newspaper advert you will see that SEC actually suppose to appear today, so you are suppose to know”, he said.
Piqued by the development, Hon. Faleke said: “Accountant general honestly, are you happy with your job, are you satisfied that you are doing the right thing and you are presenting the necessary information to Nigerians through this Committee?”
While responding, the leader of the oAGF delegation who answered in affirmative said: “We are happy to be part of the Committee.”
In a swift reaction, Hon. Faleke said: “It’s rather unfortunate honestly. At least I can see the laptop in front of my brother, it’s no longer manual.”
While responding to inquiry on the evidence of the 25 percent remittance of the N6 billion revenue generated in 2020, the SEC Director General observed that the money is deducted from the source automatically, adding that the system is too effective.
While responding to question on the period when the Commission makes marginal profit, Yuguda affirmed that the Commission makes operating surplus in its operation.
Speaking on the actual revenue remitted to the Consolidated Revenue Fund as provided by law, Mr. Yuguda who explained that the Commission is self-funded, acknowledged that the Commission is expected to remit 25 percent of its revenue at source, that’s where we receive them and then another 15 percent of our revenue at the end of our financial year.
“We are expected to remit 25 percent of our revenues at source, that’s where we receive them and then another 15 percent of our revenue at the end of our financial year, when we are auditing financial statement”, he added.
When asked to give details of the N6 billion revenue accrued to the Commission in 2020, Yuguda said: “page one we have our audited financial statement. Pages 3 to 19 we have a schedule that shows all the remittances that we have made for the 12 months in 2021 and then for the six months in 2022 from January.”
While acknowledging the N6 billion income, Hon. Faleke asked: “Where is the remittance? No don’t rush us. N6 billion income where is the 25 percent, tell me where it is, 25 percent of the N6 billion?
While the SEC helmsman disclosed that “It’s 1.588 billion Sir. Page 3.”
Hon. Faleke who frowned at the non-presentation of the evidence for the remittance of the 25 percent of the N6 billion purportedly generated, said: “where is it, which page? 1.588?”
The SEC Director General said: “2021 is 1,367,361,909.56, an explanation which Hon. Faleke faulted saying: “Oga, 2020 – 6 billion, where is the remittance?
“It’s on the last page, honourable chairman. That is the MTEF document from 2017 to 2025 and we have a figure at the very bottom, second to the last of 738,258,000, that’s 2020 column number 5.”
Unsatisfied with his presentation, Hon. Faleke asked: “What’s the 25 percent of the 6 billion?
He however noted that the implementation started in June.
While instating to know the 25 percent of the 6 billion income, Yuguda said: “It’s 1.5 billion honourable chairman.
When asked to show him the evidence of the 1.5 billion remittances, Yuguda said: “the implementation started in June 2020, the 25 percent deduction, so this is really for the 7 months.
While responding to the question on the income for the 6 months, Yuguda said: “about 3 billion Sir.”
Hon. Faleke further asked: “What period of the year did you make more money? First half, second half,” as well as the sources of income?
Mr. Yuguda responded saying: “actually, it would be in the beginning of the year. We have market transaction charges on the capital market. And we have registration of securities. We have registration of operators and then we have penalties.”
According to him, most companies file the fees at the beginning of the year “when they file their accounts, however reversed himself, saying; they do it at the end of the financial year.”
He also affirmed that the Commission gives a grace period of two months to the companies to file their accounts, adding that ‘they do not file at the very beginning of the year.”
He however disagreed that the Commission makes more money at the second half of the year, Mr. Yuguda said: “If you look at our income, these are transaction charges. So, when the market is actually more buoyant, when there are more transactions on the market and that is when you actually get those transaction charges and for penalties, it’s when those penalties are accessed and paid by different operators. Registration of securities is when those securities are actually issued and there is not time frame,” he noted.
While speaking on the reforms initiated to reposition the Commission, Mr. Yuguda who applauded the Committee’s engagement held “last year and year before the last, which was a particularly difficult time for the commission. We came at a time when the commission was really running deficit and we promised you at that time that we are going to take certain actions to really make this deficit a thing of the past.”
“I think our story this year, is that we have actually turned a corner. If you look at our 2021 and 2020 compared to 2022, the budget and the actual for the six months in 2022 you’ll see that there is actually a tremendous improvement in the way we manage the financials of the commission.”
According to him, the Commission’s budget “projected deficit of N1.6 billion but as at the end of the first half we actually had a surplus of N2.5”, adding that the success was the outcome of efforts made over the past few years to position the Commission on the path of fiscal sustainability.
He affirmed that the new management resolved to cut cost especially last year that the commission was top-heavy and we say before this committee that we had a plan to offer a voluntary early exit to some of our top personnel and I’m happy to report that at the end of last year, we actually did offer this scheme and quite a number of our staff took this offer and we are able to successfully reduce our staff strength by about 30 percent.
He affirmed that all the staff who exited have been paid their full entitlement to date, adding that nobody is being owed any penny.
In his remarks, Hon. Faleke said: “We challenged you last year and now you are living up to expectation but not there yet so we can’t commend you yet. So, keep it up.