By Tunde Oguntola, Abuja
A sub-national Audit Efficacy Index 2020 has revealed that 18 States of the federation operate without Audit Law.
They are Adamawa, Kano, Kebbi, Kogi, Plateau, Benue, Kwara, Nasarawa, Sokoto, Taraba, Ogun, Ondo, Osun, Abia, Ebonyi, Imo, Oyo, Bayelsa and Enugu states. They are with the least potent audit mechanisms in the country having scored below 50 per cent.
The report by Paradigm Leadership Support Initiative (PLSI), a civic organisation fostering accountability in Nigeria, assessed all 36 states of the federation against public finance management practices and accountability mechanisms leveraging on the role of public audit as a potent tool for improving efficiency, effectiveness, and economy of public spending.
Recall that in 2015, the federal government approved the sum of $2.1bn to provide an intervention package to help bankrupt states in Nigeria pay salaries. While there has been increasing agitation for and against resource control, not much attention has been given to public finance management practices and accountability mechanisms in state and local levels.
Also, it would be recalled that some Nigerian states were unable to access a $700 million grant from the World Bank as they failed to publish their budget online.
Related: Nigeria Needs New Audit Law
The World Bank grants are non-repayable funds disbursed or given by one party, often a government department, corporation, foundation or trust, to a recipient, often (but not always) a nonprofit entity, educational institution, business or an individual.
Basically, public audit no doubt plays a significant role in improving government’s spending and revenue capacity by limiting fiscal behaviors that result in waste, misallocation or misappropriation and corruption. It is important to recognize the impact of sub-national audit which is aimed at strengthening public finance management and accountability structures at state and local levels as is the practice at the national level.
Sub-national audit and other public finance accountability measures are not only crucial for good governance and development but particularly important to the fiscal health condition of state and local governments.
The inability of public audit to yield intended benefit as provided for in section 125 of the 1999 constitution as amended cannot be separated from the maximum control of the executive arm over the legislature and judiciary at sub-national level.
It is therefore important to allow democratic institutions at state and local levels to function effectively so that public resources can be adequately accounted for.
Addressing a virtual press briefing on Monday on sub-national Audit Efficacy Index 2020, the communications associate, PLSI, Adebisi Adeshakin, said the inability of State Assemblies’ Public Accounts Committees (PACs) to issue recommendations based on their review of reports of auditor-general’s is negatively impacting the public audit eco-system particularly at sub-national level which in turn hindering accountability in the management of public funds.
The report highlighted “twelve states including Delta, Jigawa, Kaduna, Lagos, Niger, and Rivers as states with the most potent audit process in Nigeria having scored 70/100. Also, Anambra, Borno, Yobe, Katsina and Gombe occupied 13th position with 60/100 as their score while the 2020 index ranked Oyo, Sokoto, Imo, Benue among others 25th with 40 per cent score point and Enugu as a state with the least potent audit mechanisms having scored 20/100 and ranked 36th.’’
The report said the lack of independence of the legislative arm of government at sub-national level is a cause for concern and this is evident by the recent call for legislative and judicial autonomy across the 36 States of the federation.
Similarly, it said the failure on the part of sub-national audit institutions to allow for citizens’ participation in the audit process renders audit functions inadequate and unable to facilitate sustainable development.
It lamented that it was disappointing to know that 50 per cent of states including Sokoto, ImoOsun, Benue, and Anambra do not have modern audit laws that should guarantee independence of the auditor-general in their states and enhance effective stakeholder involvement in their audit process.
The report, however, noted that some states including Zamfara, Delta, Kano and Edo are showing progress, having enacted modern audit laws and should be encouraged to do more.
Also, Delta state is among the very few if not the only state that has published an audit report on COVID-19 interventions.
In the report, Enugu State has the least potent audit mechanisms having scored 20/100 and ranked 36th.
Presenting the latest report during a virtual briefing, PLSI executive director, Olusegun Elemo, explained the methodology adopted in the assessment exercise.
He said that “PLSI undertook data integrity exercises to ensure that information used in assessing efficacy of public audit in each state were drawn from reliable sources. certain evaluation criteria were employed in arriving at the SAE index 2020 and data used fulfilled certain conditions to qualify as a valid data.”
“The SAE index 2020 was assessed using each sub-national entity’s fiscal information, legal framework, and stakeholder involvement in the public audit cycle. We standardized data sources to a scale of 0-100 where 0 equals the lowest level and 100 equals the highest level of audit capacity to produce the intended result of ensuring that public funds are adequately accounted for.
“This standardization was done by aggregating scores due from all stages of assessment which include availability (publicly) of financial statement/audited financial statement/audit report, operationalization of a modern or obsolete audit legal framework, legislative involvement in the audit process, executive actions on audit recommendations, and level of citizens participation in the audit process.”