Federal Government Mandates MDAs to Remit 100% of Revenue to New Treasury Account
The Federal Ministry of Finance, acting on behalf of the federal government, has issued a directive to all Ministries, Departments, and Agencies (MDAs), instructing them to remit 100 percent of their internally generated revenue (IGR) to the sub-recurrent account, which serves as a sub-component of the Consolidated Revenue Fund (CRF).
The primary objectives of this directive are to improve overall revenue generation, enforce fiscal discipline, and foster accountability and transparency in the management of the government’s financial resources. By doing so, the government aims to mitigate the risk of waste and inefficiencies in its financial operations.
The circular, signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, underscores the significance of these measures for effective financial management.
The directive, dated December 28, 2023, specifically tasks the Office of the Accountant-General of the Federation with the creation of new Treasury Single Account (TSA) sub-accounts for all federal agencies and parastatals listed in the schedule of the Fiscal Responsibility Act, 2007, along with any additions made by the Federal Ministry of Finance, with few exceptions.
According to the circular, fully funded MDAs through the annual federal government budget are required to remit 100 percent of their IGR to the Sub-Recurrent Account. Partially funded agencies should remit 50 percent of their gross IGR, while all statutory revenues, such as tender fees and sales of government assets, are to be remitted 100 percent to the sub-recurrent account.
Moreover, self-funded federal agencies and parastatals, which do not receive any allocation from the federal government budget, are instructed to remit 50 percent of their gross IGR, including all statutory revenues, to the sub-recurrent account. These guidelines aim to establish a clear framework for financial contributions and strengthen financial discipline across various government entities.
Under the implementation of the new policy, the recently established accounts for these agencies will receive credits transferred from the existing revenue-collecting accounts. This transfer will involve an automatic deduction of 50 percent, aligning with the provisions outlined in both the Finance Act of 2020 and the Finance Circular of 2021.
“To strengthen the implementation of these directives, the Revenue & Investment Department and the Treasury Single Account Department of the Office of the Accountant-General of the Federation (OAGF) will supervise, monitor, and conduct a monthly review of both old and new accounts.
“This ensures that only approved funds are credited, aligning with the Presidential directives conveyed in a circular dated October 16, 2018,” the circular reads.
Related Posts
The circular underscores that the Treasury Single Account (TSA) Sub-Accounts dedicated to revenue collection and operated by Agencies/Parastatals for the reception of public revenue will no longer be accessible to them. Instead, these accounts will be placed entirely under the control of the Minister of Finance and Coordinating Minister of the Economy, in collaboration with the Accountant-General of the Federation.
To ensure strict adherence to these directives, the Ministry of Finance and the Office of the Accountant-General of the Federation (OAGF) will advocate for appropriate disciplinary actions and sanctions against accounting officers of agencies/parastatals found to violate the circular’s provisions. These measures align with the stipulations of the Fiscal Responsibility Act.
