Reps Summon FCT Council Chairmen, Directors Over Financial Infractions

The House of Representatives has summoned six area council chairmen in the Federal Capital Territory (FCT) and their directors of finance to appear before it to respond to the audit queries which indicted them of N100 billion financial infractions.

The chairman, House Public Accounts Committee, Hon. Bamidele Salam, disclosed this while confirming the panel’s formal receipt of the audit report.

The audit report for the year ended 31 December 2021, submitted to the committee, revealed widespread cases of unremitted tax and VAT deductions, failure to update fixed asset registers and expenditure yet to be properly accounted for across the councils.

According to the report, the six area councils recorded outstanding liabilities amounting to N7.6 billion as of 31 December 2021.

The liabilities comprised unremitted pension deductions, unremitted Pay-As-You-Earn (PAYE), unpaid capital project obligations, unremitted Value Added Tax (VAT), and withholding taxes due to the Nigeria Revenue Service (NRS), FCT Inland Revenue Service, Pension Fund Administrators and contractors.

A breakdown of the unremitted liabilities showed that Abuja Municipal Area Council (AMAC) had outstanding obligations of N2.19 billion, followed by Bwari Area Council with N1.49 billion and Kwali Area Council with N1.46 billion.

The report added that Gwagwalada Area Council recorded N1.01 billion, Kuje Area Council N892.2 million, while Abaji Area Council accounted for N593.8 million, bringing the total to N7.65 billion.

The auditor-general also faulted the area councils for failure to properly maintain and update their fixed asset registers.

The report cited Gwagwalada Area Council, where non-current assets valued at N336 million were not adequately maintained or updated, creating room for asset losses without trace.

The report noted that this weakness was common across the other area councils.

The audit also raised concerns over expenditure totalling N24.8 billion incurred by the six councils in 2021 on personnel, overheads and capital projects. Despite an 89 per cent increase in total expenditure amounting to N11.7 billion when compared to 2020, the councils have not accounted for how 37 per cent of the expenditure purportedly allocated to capital projects was utilised.

A breakdown of the expenditure showed that Abuja Municipal Area Council spent  N5.03 billion, Gwagwalada Area Council N4.66 billion, Kuje Area Council N3.85 billion, Kwali Area Council N3.84 billion, Bwari Area Council N3.74 billion and Abaji Area Council N3.71 billion, bringing the total expenditure to N24.87 billion.

Audit findings for the year 2022 and part of 2023 also identify multiple infractions of financial regulations such as understatement of actual Internally Generated Revenue (IGR), unauthorised assets disposal, non disclosure of statutory revenue and non remittance of withholding tax to appropriate authorities.

The Public Accounts Committee chairman warned the summoned chairmen and directors of finance that they have a final opportunity to appear before the panel next week Wednesday.

Salam stressed that failure to honour the invitation would compel the House to invoke its constitutional powers to order their arrest and ensure compliance.

He added that the area councils were also indicted for failure to audit and submit their financial accounts for the years 2023, 2024 and 2025, contrary to statutory requirements.

The committee’s chairman stressed that public funds must be managed with transparency and prudence, warning that any official found culpable would be held responsible in accordance with the law.