The government has issued guidelines to regulate forex payments in compliance to ensure financial discipline for reviving the stalled International Monetary Fund (IMF) programme.
A new circular has instructed that under the new guidelines, all ministries and divisions are required to obtain prior permission from the External Finance Wing of the Finance Division for all commitments involving foreign exchange for the payment of subscriptions and contributions to international organizations.
To comply with the federal government’s financial procedure, articles 78 to 84 of the Constitution prescribe that no expenditure from the Federal Consolidated Fund shall be made unless it is authorized by the National Assembly and specified in the Schedule of Authorized Expenditure, so authenticated by the prime minister.
The Public Finance Management Act 2019 has been enacted by the federal government in pursuance of Article 79 of the Constitution. It provides that custody and operation of the Federal Consolidated Fund and Public Account of the Federation shall vest in the Finance Division under the supervision of the federal government.
Section 23 of the Act further provides that no authority shall incur or commit any expenditure or enter into any liability involving expenditure from the Federal Consolidated Fund and Public Account of the Federation until the same has been sanctioned by a duly-empowered competent authority, and the expenditure has been provided for the financial year through Schedule of Authorized Expenditure; or Supplementary Grant and Technical Supplementary Grant; or Re-Appropriation.
The Finance Division has emphasized efficient, prudent, and disciplined management of available resources by all Principal Accounting Officers (PAOs) and other persons authorized to spend public money over the past year. To maintain financial discipline, all expenditures should be based on well-defined plans and should remain within the allocated and released budget.