Asaba, July 5, 2023: The Federal Ministry of Finance, Budget and National Planning (FMFBNP), has urged all federal Ministries, Departments and Agencies (MDAs) to key into its debt recovery policy to improve government revenues.
The ministry said that it has recovered over N58 billion out of about N5.2 trillion owed by over 7,000 debtors to 11 MDAs in the past three years through its Project Lighthouse policy.
The Director, Special Projects, FMFBNP, Mr Victor Omota, made the disclosure at the South -South Zonal Sensitisation Workshop on Federal Government Debt Recovery Drive Through Project Lighthouse on Tuesday in Asaba, Delta.
He said efforts were been intensified to track all the debts owed the MDAs by its clients to ensure improved revenue to the government.
“It may interest you to note that the Ministry through the consolidation efforts of the Debt Analytics and Reporting Application has been able to aggregate monumental debts of approximately N5.2 trillion.
“These debts came to the spotlight from data aggregated from over 7,000 debtors across 11 MDAs. The debt aggregation effort is still ongoing,” he said.
Omota, represented by Mrs Bridget Molokwu, deputy director in the ministry, said that the Project Lighthouse was designed by the federal government through collaboration with the 946 federal MDAs to recover all debts owed and to tighten the revenue loopholes and leakages.
“You will recall that one of the key economic policy objectives of the current administration, as contained in the Economic Recovery and Growth Plan (ERGP), is improving Federal Government revenues by targeting and increasing revenues from non-oil revenue sources.
“An important part of our policies and strategies is to leverage big data technology to help block revenue loopholes, identify new revenue opportunities, optimize existing revenue streams especially non-oil revenue as well as improve fiscal transparency.
“In actualizing this goal, the FMFBNP initiated ‘’Project Lighthouse’’, which is one of the portfolio projects under the Strategic Revenue Growth Initiative (SRGI).
“This initiative has enabled the aggregation of relevant economic and financial information from multiple agencies who hitherto did not share data,” Omota said.
According to him, revenue loopholes have been aided by poor information sharing and enforcement.
“Data from Project Lighthouse revealed that many companies and individuals who owe government agencies, have refused to honour their obligations.
” In spite of the debt, the debtors were still being paid especially through the government platforms such as GIFMIS and Treasury Single Account (TSA) due to lack of visibility over this transactions.
“These debts are in the form of debt liabilities to the Federal Inland Revenue Service (FIRS); refunds to the Government by companies who failed to deliver on projects for which payment had been effected.
“Also unpaid credit facilities granted to both corporate entities and individuals by the Bank of Industry (BOI) and Bank of Agriculture (BOA); judgment debt in favour of Government, debts owed Pension Transitional Arrangement Directorate (PTAD) by Insurance Companies, others.”
He noted that the ministry collaborating with the MDAs would promptly help to recover these debts and address these major revenue loophole.
According to him, government has issued a Ministerial directive on Sept. 26, 2019 to all MDAs, with a view to aggregate all Government debt across the Public Finance Space as well as to have a single window on the credit profile of Government.
“Also, the Federal Executive Council (FEC) regulatory approval on Wednesday, March 31, 2021, extended the functionalities of Debt Recovery Capability of Lighthouse to enable the FMFBNP fully automate the debt recovery process and make settlements of debts as seamless as possible,” he said.
In an interview with Mr Abraham Atteh and Mr Suleiman Tambaya, Consultants to FMFBNP, they opined that government could deliver more social services to the citizenry if it could recover all debts owed it from the MDAs to improve its revenues.
They said that the idea behind Project Lighthouse was to collaborate with the 946 MDAs of the federal government to track and recover debts owed them using designed technological system.
According to Atteh, the Project Lighthouse which came into operations in 2019, has been able to aggregate about N5.2 trillion debt across 11 MDAs.
“But this is a shortfall of the debt aggregate given the 946 MDAs because the debt from 11 MDAs are not true reflection of the debt profile owed the government.
According to Tambaya, this sensitisation is aimed at encouraging all the MDAs to key into the Project Lighthouse to ensure seamless debt recovery process from their clients.
