Nigeria: Reps Panel Queries Lottery Trust Fund Over Extra-Budgetary Spending

20 November 2023

The committee said the agency is fully funded and must remit all revenue to the Consolidated Revenue Fund and should not spend money without the approval of the legislature.

The House of Representatives Committee on Finance has ordered a "status enquiry" into the accounts of the National Lottery Trust Fund (NLTF) following alleged extra-budgetary spending by the management of the agency.

The committee gave the order on Monday when the management of the agency appeared before it in the ongoing hearing into the 2024-2025 Medium Term Expenditure Framework.

Its Chairman, James Faleke (APC, Lagos), ordered the enquiry after the agency failed to justify the spending of N6 billion internally generated revenue (IGR) in 2022 and spending the money without budgetary approval.

NLTF also spent N2.5 billion in 2023 without approval, the committee found.

"Which Act gives you the power to spend your IGR? The constitution is supreme to any Act of the National Assembly. When you are fully funded, you are expected to remit your IGR 100 per cent - no deduction, no nothing. So, if you generate N3 billion, you are expected to remit N3 billion," Mr Faleke said.

Responding to the query, the Executive Secretary of NLTF, Bello Maigari and its Director of Finance and Account, Muhammed Aminu, said the Act establishing the Fund gives them the power to use the money without the approval of the National Assembly.

Mr Maigari explained that Section 40 of the National Lottery Trust Fund Act gives its management the power to use the fund as an intervention fund. He explained that the management needs only the approval of the Board of the fund to spend the IGR.

"The proceeds of the Trust Fund established under section 35 of this Act shall be applied, from time to time - the Trust to fund projects approved by the President, on the recommendation of the Board of Trustees, to be in the interest of the Nigerian community and such projects shall include but not limited to projects for the advancement, upliftment and promotion of sports development, education, social services, public welfare and relief, and management of natural disasters in Nigeria," Section 40 of the Act reads.

The explanation by Mr Maiyaki was challenged by the lawmakers, who stated that the 1999 Constitution remains supreme.

Mr Faleke argued that the management of the agency is fully funded, hence, it must remit all revenues into the consolidated fund of the federation.

"I am going to amend the section on the floor of the House so that it does not confuse you. There is even no confusion. This man (Director of Finance) here knows, he knows his job as a financial person. He knows and you have been so educated. I am 100 per cent sure that there is no DFA that does not know that IGR is remitted 100 per cent.

"It is like the government just opened this agency for you and your family. That's the meaning. You generated N2.5 billion and spent N2.5 billion to the kobo," Mr Faleke said.

Following the inability of the management of the agency to adequately defend the expenditure, Mr Faleke ordered that the National Assembly conduct a status enquiry on it.

"We going to carry out a status enquiry on the trust fund. Status enquiry means we are going to bring in an external auditor to audit your account and your books in respect of your income and expenses," he said.

The committee is currently holding a hearing on the MTEF which President Bola Tinubu transmitted to the National Assembly in October.

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