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Cablegate: Nigeria: Information On Gon Fiscal Transparency

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 ABUJA 000887

SIPDIS


STATE FOR AF/W, AF/EPS, AND EB/IFD/OIA
TASHKENT FOR BURKHALTER


E.O. 12958: N/A
TAGS: AA AMGT EAID ECON EFIN EINV EPET ETRD NI
SUBJECT: NIGERIA: INFORMATION ON GON FISCAL TRANSPARENCY

REF: STATE 100294


1. Paragraph 2 provides answers to reftel questions.


2.
A. Does the host government publish the national budget in a
timely manner?


Answer: Yes, with minimum delay (under one year).


B. Where sub-national levels of government are significant,
are their combined fiscal positions published?


Answer: No.


C. In what form is the national budget published?
Answer: Government publication.


D. Please rate the quality and comprehensiveness of fiscal
data published.


Answer: No adequate system of budget reporting and monitoring
with limited classification system. There are significant
payment arrears, and actual expenditures often deviate
significantly from amounts budgeted.


E. List up to five key laws and/or regulations governing
public disclosure and expenditures in the national budget, if
applicable and such laws exist.


Answer: Constitution of the Federal Republic of Nigeria
(1999).


F. Assess the adequacy of those laws and regulations
establishing fiscal transparency and accountability
requirements.


Answer: Wholly inadequate.


G. Assess extent to which laws and regulations on fiscal
transparency and accountability are implemented and enforced.


Answer: Sporadically/unevenly enforced.


H. How would distribution of tax powers and expenditure
responsibilities of central government be described.


Answer: Currently being clarified.


I. Does a national audit body or equivalent organization,
independent of the executive, provide reports for the
legislature and the public on the financial integrity of
government accounts?


Answer: Yes.


J. How would the link between nonfinancial public/state-owned
(e.g., extractive industries) enterprises and general
government be described?


Answer: Limited independence of spending/procurement.


K. Are privatization processes transparent and published?


Answer: Mostly transparent.


L. How would the reliability and budget revenue and
expenditure estimates best be described?


Answer: Unreliable.


M. Please provide a short evaluative narrative of host
government commitment to fiscal transparency and
accountability.


Answer: The GON has a stated commitment to budget
transparency. In his message to the National Assembly
accompanying the 2003 budget proposal, President Obasanjo
pledged the following: &Continued emphasis on allocative
efficiency by ensuring value for money in Federal Government
expenditure and ensuring execution follows rules of fiscal
transparency at all levels.8 To date, publicly available
information on the 2003 budget proposal includes no details.


The 2002 budget, including details, was made widely available
in early 2002, but information on how that budget was
actually implemented is lacking. The Office of the Accountant
General of the Federation claims that it publishes a monthly
cash flow statement on a website (www.oagf.gov.ng) showing
consolidated revenues and expenditures. However, Post has
been unable to locate the website or obtain a copy of such a
statement from the Accountant General, and Post is unaware of
any other publicly available documents that reconcile the
budget with actual expenditure.
A due diligence unit has been established in the Office of
the President to vet budget expenditures on major
government-funded contracts to ensure that expenditures are
in line with prevailing international rates.


The Auditor General of the Federation in early 2003 provided
the National Assembly with a report on 2001 fiscal year that
was critical of some Ministries. The Acting Auditor General
who submitted the report was replaced under ambiguous
circumstances. In early May 2003, the outgoing Senate
announced it would hold public hearings on the report's
findings, but it is unclear whether these hearings will
continue when new members take office at the end of May.
In 2002, the National Assembly considered but did not pass a
fiscal responsibility bill that would more clearly spell out
the steps the GON must take to ensure transparency and
accountability of public expenditure. A procurement reform
bill was also introduced but not passed.


N. Please list U.S. government-sponsored programs and
activities that promote accurate disclosure of revenues and
expenditures in the national budgets of your host country.


Answer: USG Assistance to the GON in fiscal transparency
since the return to democracy in 1999 has included the
following:
--Supporting the Budget Office of the Federation to improve
development and execution of the Federal budget in a more
transparent manner;
--Assisting &due process8 examination of the capital budget
by Budget Monitoring and Price Intelligence Unit;
--Supporting development of a best-practices Public
Procurement Law, which is awaiting legislative passage, and
of a Public Procurement Procedures Manual, which can be
employed once the enabling legislation is passed;
--Assisting the Debt Management Office to track and manage
Federal domestic debt; and
--Parallel financing (with World Bank, U.K. Department for
International Development, and the European Union) of an
Economic Management Capacity Building Project.
JETER

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