TSA: Senate to Probe Commercial Banks, CBN’s Share of Charge

The Senate said monday that it would beam its searchlight on the Central Bank of Nigeria’s  (CBN) and commercial banks’ share of the controversial one per cent charge on monies transferred to the Treasury Single Account (TSA) by Ministries, Departments and Agencies (MDAs) of the federal government.

The Senate, which had ordered investigations into the charge by a company, Systemspecs, owners of Remita, the software used for the transfer of funds from the MDAs to the TSA, said it was appalled that while the CBN had compelled the company to refund its own share, both the central bank and the commercial banks have held on to their commission.

The Chairman of the Joint Committee on Finance and Banks and Other Financial Institutions, Senator John Eno, disclosed this in response to a THISDAY inquiry on the balance of the charge, which the Senate appeared to have overlooked in its investigations.

At the public hearing of the investigations by the Senate last week, the CBN Governor, Mr. Godwin Emefiele, had given the breakdown of the charge earned by the trio, saying Systemspecs got 50 per cent; the commercial banks, who were termed Deposit Money Banks, 40 per cent; and the CBN, 10 per cent.

However, following CBN's instruction ordering Systemspecs to refund its share of the charge, the company refunded N8 billion. This ordinarily implied that another N8 billion, being 50 per cent balance of the charge by the CBN and DMBs was still outstanding.

But last week's investigative hearing organised by the Joint Senate Committee on Finance and Banks and Other Financial Institutions focused mainly on the charge accruable to Systemspecs without paying attention to DMBs and CBN's shares of the charge.
Thus, there has been no information on whether they had refunded their own shares of the charge or not.

But the chairman of the Joint Committee on Finance and Banks and Other Financial Institutions said the committee would beam its searchlight on the matter.

Although Eno believed that the N8 billion refunded by Systemspecs was the totality of the accrued charge from the N2.03 trillion realised from transfers into the TSA so far, he said following a further inquiry by THISDAY, the committee would look into the issue.

The senator further disclosed that his committee's latest mandate to submit the output of the committee's legislation on Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Policy (FSP) to the Senate today had compelled it to temporarily suspend work on the TSA probe until the report on MTEF is submitted.

He said: "The totality of money taken from the TSA was put at N8 billion which was what was returned. But with what you are raising now, it is now for us to invite each of them so that we can have the understanding of the missing link - whether what Systemspecs returned was all the charge, it is for the secretariat to find out. That is a question to be asked. That has become an issue for the secretariat to find out."

The probe of Remita followed an alarm raised by Senator Dino Melaye (Kogi West) during one of Senate's recent plenaries that Systemspecs, owners of Remita software, took N25 billion allegedly being one per cent of transfers to TSA in one day, an allegation which has, however, been found to be sheer falsehood as only N8 billion was the entire accruable charge to Systemspecs then and which it had refunded.

But despite the CBN asking Systemspecs to refund its benefit for the services rendered through Remita software, both MDAs and banks have continued to use Remita to transfer funds to TSA without accruable charge from the owners.

While explaining how the name of Remita was invented, the Managing Director of Systemspecs, Mr. John Obaro, explained that the name given to the software was coined from the abstract noun, "remittance," the task that the software was meant to perform.

During last Wednesday's opening hearing into the matter, the CBN governor and Accountant General of the Federation, Mr. Ahmed Idris, admitted that Remita was engaged to provide the service because NIBS, a subsidiary of the CBN, which was expected to render the service lacked the capacity to do so whereas Remita had been proven to be effective and competent in discharging the service.

They also admitted that both the Office of the Accountant General of the Federation and the CBN agreed to the one per cent charge on the transfers after which two memoranda were signed by Systemspecs and the federal government, and another with the CBN.

However, both Idris and Emefiele, who were not in office when the MoU were signed denied knowledge of the one per cent charge agreement while Obaro lamented that their denials amounted to betraying citizens who came to government's rescue in terms of need.
The investigative hearing is expected to continue this week.