Nigeria improves in U.S. fiscal transparency assessment

The United States has classified Nigeria among 14 countries that made “significant progress” towards meeting its minimum fiscal transparency requirements in 2019. The classification came in the 2020 Fiscal Transparency Report released by the U.S. Department of State. The document, released annually, assesses budget transparency of 141 national governments that receive U.S assistance. It uses criteria such as “public availability, substantial completeness and reliability of budget documents” in its assessment. The report also judges the countries based on the transparency of the process of awarding government contracts and licenses.

The 2020 edition, which covers Jan. 1 to Dec. 31, 2019, stated that 76 of the 141 countries met the minimum requirements of fiscal transparency. Fourteen of the 65 governments that did not meet the minimum requirements, including Nigeria, made “significant progress” during the review period.

The 13 other countries that made progress alongside Nigeria are Bahrain, Benin, Ecuador, The Gambia, Madagascar, Maldives, Mali, Mauritania, Niger, Somalia, Ukraine, Uzbekistan and Yemen.

In the 2019 edition, which covered Jan. 1 to Dec. 31, 2018, Nigeria was neither among 74 countries said to have met the minimum requirements nor among 13 adjudged to have made significant progress.

“Nigeria made significant progress by including allocations to and earnings from its state-owned enterprises in its budget documents.   During the review period, the government made its executive budget proposal, enacted budget, and end-of-year report accessible to the general public, including online. Information on debt obligations was publicly available,” the latest edition said. It added that the government’s 2019 budget documents provided detailed estimates for revenues and expenditures. However, it said the documents provided “only high-level earnings and expenditures estimates from state-owned enterprises”. The Nigerian National Petroleum Corporation (NNPC), according to the report, did not make fully audited financial reports available to the public.  “Actual revenues and expenditures varied significantly from estimated figures making budget documents unreliable.  Nigeria’s supreme audit institution completed audits of the government’s budget and reportedly made audit reports on its website.  The criteria and procedures by which the national government awards contracts or licenses for natural resource extraction were specified in law and regulation. 

“The government has appeared to follow applicable laws and regulations in practice. 

“Basic information on natural resource extraction awards was publicly available,” the report said.

It suggested three steps that the Federal Government should take to improve its fiscal transparency.

They include publishing its executive budget proposal within “a reasonable period of time”. A “reasonable period of time”, according to the report, means not less than one month before the start of the fiscal year and before the National Assembly passes the budget. It also means “within three months of enactment for the enacted budget, and within 12 months of the end of the fiscal year for the end-of-year”. The Federal Government has also been advised to produce and publish details of its supplementary budget “when actual revenues and expenditures do not correspond to those in the enacted budget”. The report urged the government to make “full audit reports for significant, large state-owned enterprises publicly available”. It, however, noted that while lack of fiscal transparency could be an enabling factor for corruption, it did not assess corruption.  “A finding that a government ‘does not meet the minimum requirements of fiscal transparency’ does not necessarily mean there is significant corruption in the government.  Similarly, a finding that a government “meets the minimum requirements of fiscal transparency” does not necessarily reflect a low level of corruption,” the report said.(NAN)