TSA Gives Nigeria N45B Monthly in Interest Payments Alone
Nigeria’s minister of finance, budget and national planning, Mrs. Zainab Ahmed, said on Tuesday that the federal government is currently saving an average of N45 billion monthly in interest payments following the implementation of the TSA.
Ahmed, who spoke during the signing of a Memorandum of Understanding (MOU) on TSA between Nigeria and the Republic of The Gambia, stated that among other verifiable benefits, Nigeria could now easily determine its aggregate cash balance, which is critical for managing public finances at a time of acute fiscal constraints.
“On the monetary policy side, we have better control over money supply and, therefore, able to rein in inflation and undue pressure on the naira. Our foreign reserves position has also recorded appreciable improvement through the consolidation of the federal government foreign currency earnings under the TSA,” she said.
Elaborating on the MoU, she said: “In a nutshell, the cooperation seeks to avail the Ministry of Finance and Economic Affairs of The Gambia of the vast knowledge, experience and technical expertise that Nigeria has gained in the past 15 years of implementing TSA in particular and other public financial management (PFM) reforms in general.
“By so doing, The Gambia is properly guided as it implements its own TSA. The co-operation will enable The Gambia to leverage on the experience of Nigeria to build on our strengths while avoiding our mistakes.
“We are happy to support The Gambia in their bid to implement TSA and other PFM reforms. We are also open to supporting other African countries which may want to build on our experience and significant progress in TSA implementation.
“It is our belief that African countries are better off learning from each other and supporting each other because of our shared culture and history.”
She urged The Gambia to muster the necessary political will before forging ahead with adopting TSA, warning that it is better to secure the buy-in of topmost political actors in the country.
According to her, the importance of the synergy between the fiscal and monetary authorities cannot be over-emphasised, as the co-operation of other stakeholders, including the parliament; ministries, departments and agencies of government, banks and service providers is also important.
In her remarks, the leader of the Gambian delegation to the MoU signing ceremony, the country’s Permanent Secretary, Ministry of Finance and Economy, Ms. Ada Gaye, explained that cooperation has helped them to understand the workings of the TSA.
“The Gambia wants to efficiently manage its funds; the fragmentation of accounting systems in The Gambia is huge. It is, therefore, noteworthy for The Gambia to adopt TSA,” she said.
She added that the government of The Gambia will create the needed sensitisation to help the people understand the process.
At the ceremony, the Governor of CBN, Mr. Godwin Emefiele, said the role of the apex bank is critical to the overall success of TSA.
Represented by the CBN Deputy Governor, Operations, Mr. Adebisi Shonubi, he said Nigeria is currently realising additional benefits, which were never imagined prior to the commencement of TSA.
He noted that it was important that the Central Bank of The Gambia realises that its primary mandate of price stability will change as it assumes the back stock and corresponding bank for the country as a result of TSA.
Nigerian Sketch learnt that the gross accruals into the TSA reached over N19 trillion between August 2015 and February 2020, according to data from the Office of the Accountant-General of the Federation.
The TSA was introduced in 2012 by the administration of President Goodluck Jonathan to consolidate all inflows from all agencies of government into a single account at the Central Bank of Nigeria, but it was more strictly enforced from 2015 at the start of the administration of President Muhammadu Buhari.
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