The House of Representatives, on Wednesday, quizzed the management of the Federal Mortgage Bank of Nigeria (FMBN) over the misapplication of N90.857 billion revenue accrued to the organisation between 2016 and 2021.
Chairman, House Committee on Finance, Hon James Faleke, who presided over the interactive session with heads of Ministries, Departments and Agencies (MDAs) on the 2022-2024 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), expressed grave displeasure over the failure of the Bank to declare dividends to Federal Government on its N5 billion share capital.
The lawmakers who faulted the discrepancies between the monthly wage bill of about N200 million presented by the FMBN CEO and the figures computed in the financial statement of N5.4 billion, aside from the gratuity and gratuity; decried the huge sum of N22 billion spent on overhead in 2018.
While responding to questions on the bank’s performance, Managing Director/CEO of FMBN, Ahmed Dangima, who argued that the Bank is a limited liability company, however affirmed that the Bank has not given dividend to Federal Government after the injection of N5 billion share capital since inception.
Mr Dangima who disclosed that the Bank’s staff strength stands at 1,025, unveiled plans to secure N100 billion from Federal Government in the 2022-2024 MTEF/FSP presented to the Committee.
He explained that from the interest of 6% imposed on housing loan, FMBN gets 2%, Primary Mortgage Banks get 2% while 2% accrued go to each contributor at retirement.
The financial report presented to the committee showed that the Bank generated sums of N15.878 billion in 2016; N19.922 billion in 2017; N22.474 billion in 2018; N26.090 billion in 2019 and N26.502 billion in 2020 while out of total revenue projection of N39.473 billion for 2021, the bank has realized N6.940 billion as at Q1 of 2021.
However, the bank spent N7.239 billion in 2016; N8.832 billion in 2017; N13.356 billion in 2018; N15.161 billion in 2019 and 16.863 billion in 2020 while out of N22.003 billion proposed expenditure for 201, the sum of N3.278 billion was spent as at Q1.
According to the financial report, the Bank put its Operating surpluses at: N2.353 billion in 2016; N4.373 billion in 2017; a deficit of N2.805 billion in 2018; N3.983 billion in 2019 and N5.070 billion in 2020, as well as a deficit of N214.553 million as of Q1 2021.
The lawmakers also frowned at the ‘Other Expenses (Non-Cash) sub-head amounting to: N6.285 billion in 2016; N6.717 billion in 2017; N11.923 billion in 2018; N14.913 billion in 2019 and N14.709 billion in 2020 as well as N3.877 billion as of Q1 2021.
In his ruling, Hon Faleke who ruled out the possibility of obtaining N100 billion from the Federal Government between 2022 and 2024, directed the Budget Office of the Federation and Fiscal Responsibility Commission to capture FMBN in the schedule of revenue-generating agencies that should render its audited financial accounts as well as operation surplus in line with extant financial regulations.
While noting that the houses being constructed by the PMBs are not given free to contributors and interested Nigerians, he expressed the need for Federal Government to get value for its N5 billion investment since 1992.
In the same vein, the lawmakers unanimously resolved to conduct a Status Inquiry on the activities of the National Lottery Trust Fund (NLTF) over its failure to ensure accountability of revenue accrued to the Commission.
In his earlier presentation, NLTF Executive Secretary, Mr Bello Maigeri, said that the Fund has a mandate to intervene in several areas like sports, health, education and disaster management when there is need, in line with the legislation passed in 2005.
He affirmed that Federal Government fully funded the personnel, overhead and capital component of the National Lottery Trust Fund’s annual budget, adding that constituency projects of National Assembly members form part of the revenues accrued to the Fund.
According to him, “Section 40 of the Act says proceeds of the Trust Fund shall be applied from time to time to fund projects approved by the President on the recommendation of the Board of Trustees of the Fund in the interest of the Nigerian community.
“Such project shall be for the advancement, upliftment and promotion of sports development, education, social services, welfare, relief and disaster management in Nigeria.
“Sub section B allows the Fund to use part of the proceeds for the cost of the administration of the Trust Fund meaning that we are to lease our operational office in the headquarters and in the zones.
“We are to fund our operational vehicles and to carry out very key duties such as monitoring and valuation, research and development and implement all these good causes under this cost of administration.
“Sub section C empowers the Fund to apply part of the proceeds for payment emolument and allowances of staff as well as a member of the board of trustees of the fund,” Mr Maigeri said.
In his intervention, a member of the House Committee on Finance, Hon. Sada Soli alleged that the NLTF Act is self-serving and did not reflect the interest of Nigerians, called for its amendment.
“It is actually not in agreement with the Constitution of the Federal Republic of Nigeria as to who has the authority to approve the budget; it is not the President, the President shall present and the National Assembly shall approve,” he noted.
While ruling, Hon. Faleke said: “In the meantime, we are giving this directive; that the Budget Office should write a letter to Trust Fund pending the investigation we intend to carry out National Lottery Trust Fund, all revenue remittance to the fund should stop for now.
“We are not satisfied with the utilization of the funds accrued to that agency and that money can save a lot out of our deficit. We will look at how the law came and we will actually amend it; it is completely not in agreement with the Constitution of the Federal Republic of Nigeria; there is no national interest at all, it is self-centred,” Hon. Faleke said.
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Budget defence: Reps quiz FMBN over N90.8bn accrued revenue, non-declaration of dividends
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