By Okafor Joseph Afam
November 20, 2024

An annual audit report by the Office of the Auditor-General of the Federation (OAuGF) has revealed unapproved spending exceeding N4.64 billion in the Federal Ministry of Works and Housing. The report, covering activities between 2020 and 2021, highlights substantial lapses in internal controls during the tenure of former Minister Babatunde Fashola.

Key Findings

Unauthorized Payments and Weak Controls

The audit uncovered payments totaling N1.08 billion made without the requisite vouchers, in violation of Nigeria’s Financial Regulations. Additionally, N546 million was transferred to project accounts without proper documentation or budgetary approval.

These lapses, attributed to inadequate internal controls, expose the ministry to risks of misappropriation and loss.

Extra-Budgetary Expenditures

The report identified over N2.89 billion in expenditures without legislative approval, including N1.88 billion spent without appropriation. A notable instance involved over N1 billion paid to contractors for road projects in Katsina State, which were only included in the 2017 budget.

These violations contravened Section 80(4) of the 1999 Constitution, which mandates legislative approval for withdrawals from public funds.

Dubious Contracts and Non-Compliance

Contracts worth N493.97 million were awarded to companies not registered with the Corporate Affairs Commission (CAC). Among these, N170.36 million was paid to unregistered entities, and one company awarded a contract in 2016 was only incorporated in 2019, breaching the Public Procurement Act.

The report also highlighted mobilization fees exceeding legal thresholds, such as N110.81 million (22.61% of the total contract sum) paid for a project in Oyo State, far surpassing the 15% limit prescribed by financial regulations.

Procurement Irregularities

Five contracts, valued at N27.84 million, were awarded without competitive bidding, contrary to Section 24(1) of the Public Procurement Act. Furthermore, essential procurement documents, including advertisements and tender evaluations, were reportedly missing.

Recommendations

The Auditor-General urged the ministry to:

1. Recover Unauthorized Funds: Ensure remittance to the government treasury.
2. Sanction Responsible Officials: Enforce penalties under Paragraphs 3106 and 3129 of the Financial Regulations.
3. Reform Internal Controls: Implement stronger mechanisms to prevent future lapses.

Public Reactions and Implications

The revelations have sparked public outcry, with calls for accountability and transparency. Advocacy groups argue that the findings underscore systemic weaknesses in Nigeria’s public financial management system.

As current Minister Dave Umahi takes over, the spotlight remains on the Ministry of Works and Housing to address these irregularities and restore public trust.

This report serves as a stark reminder of the need for robust oversight and adherence to due process in public service administration.