Politics

Auditor-General Exposes ₦4.6 Billion in Unauthorized Expenditures in Ministry of Works

Published by Tope Fakinlede on November 20th, 2024.

Auditor-General Exposes ₦4.6 Billion in Unauthorized Expenditures in Ministry of Works

A recent audit report has revealed significant financial irregularities totaling over ₦4.64 billion in the Federal Ministry of Works and Housing, sparking concerns over violations of financial and procurement regulations.

The findings, outlined in the Auditor-General for the Federation’s Annual Report, cover the period from 2020 to 2021 and highlight substantial weaknesses in internal controls under former Minister Babatunde Fashola. The report points to several lapses, including unapproved payments, excess spending beyond budgetary limits, and improper contract awards.

Key discoveries include:

Improper Payments: ₦1.08 billion was paid from the Government Integrated Financial Management Information System (GIFMIS) account without necessary payment vouchers, breaching financial regulations. Additionally, ₦546 million was transferred to project accounts lacking proper documentation or budget allocation.

Extra-budgetary Expenditures: The audit uncovered ₦2.89 billion in unapproved spending, including ₦1.88 billion expended without legislative approval, violating constitutional provisions that require parliamentary authorization for public fund withdrawals.

Unregistered Contractors: The Ministry awarded contracts totaling ₦493.97 million to companies not registered with the Corporate Affairs Commission (CAC). Payments made to unregistered entities raised concerns about the legitimacy of the contracts and the potential for mismanagement.

Excess Mobilization Fees: In Oyo State, the Ministry paid ₦110.81 million—22.61% of the contract sum—as mobilization fees for a project, exceeding the 15% cap stipulated by financial regulations. Similarly, other contracts were awarded and mobilization payments made without adhering to established guidelines.

The report emphasized the need for the Ministry to justify these questionable payments and recover the misallocated funds. It also called for the submission of evidence of compliance with financial regulations to the National Assembly’s Public Accounts Committees, with the threat of sanctions for non-compliance.

The audit also flagged other irregularities, including the lack of competitive bidding for several contracts, improper documentation, and violations of the Public Procurement Act.

In response to these findings, the Auditor-General has urged immediate reforms to strengthen internal controls and ensure better financial oversight. Furthermore, the Senate has warned that heads of government agencies found guilty of financial misconduct will face sanctions, underscoring the importance of accountability in public sector spending.

This report paints a troubling picture of financial mismanagement within the Ministry of Works and Housing, with potential risks of fund diversion and wasted public resources.