In a significant departure from the financial policies of the previous administration, President Bola Tinubu’s government has issued directives mandating all ministries, departments, and agencies fully funded by the federal government to remit 100% of their revenues into the Sub-Recurrent Account, a component of the Consolidated Revenue Fund (CRF).
The move, detailed in a circular from the Finance Ministry on December 28 and announced on Tuesday, aims to consolidate federal revenue earnings.
This marks a shift from the single treasury account system employed during the tenure of Muhammadu Buhari. The new policy is part of President Tinubu’s broader strategy to enhance revenue generation and instill fiscal discipline, accountability, and transparency in resource management, thereby preventing waste.
The directives specify that all fully funded Ministries, Departments, and Agencies (MDAs) should remit 100% of their Internally Generated Revenue (IGR) to the Sub-Recurrent Account, as outlined in the Fiscal Responsibility Act, 2007, and subsequent additions by the Federal Ministry of Finance. Additionally, agencies and departments that are partly funded by the federal government are expected to remit 50% of their gross revenue, while statutory revenue such as tender fees and sales of government assets should be remitted in full to the sub-recurrent account.
The Office of the Accountant-General of the Federation will open new Treasury Single Account (TSA) Sub-Accounts for all Federal Government Agencies/Parastatals listed in the schedule of the Fiscal Responsibility Act, 2007, and any additions by the Federal Ministry of Finance, except where expressly exempted. These new accounts will be credited based on the new policy implementation of a 50% auto deduction in line with the Finance Act, 2020, and Finance Circular, 2021, with a 50% cost-to-revenue ratio.
The Office of the Accountant General of the Federation, depending on agency categorization, will automatically deduct 50% on gross revenue of self/partially funded agencies/parastatals and 100% for fully funded agencies/parastatals, serving as an interim remittance of the amount due to the Consolidated Revenue Fund. This initiative reflects President Tinubu’s commitment to sound financial management and sustainable economic development.
