The implementation of the Treasury Single Account (TSA), has been of immense benefit to the country as the Federal Government now saves an average of N45 billion monthly in interest payments.
Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, disclosed this at the signing of memorandum of understanding (MoU) on TSA with the Republic of The Gambia in Abuja on Tuesday.
She said that among other verifiable benefits, the country 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 reserve position has also recorded appreciable improvement through the consolidation of the federal government foreign currency earnings under the TSA,” she stated.
The Minister recalled that in May, 2019 The Gambian delegation based on the recommendation of the International Monetary Fund (IMF), visited Nigeria for a week-long study tour of TSA implementation.
According to her, “Following the successful conclusion of the tour, The Gambia requested for technical co-operation with Nigeria to support its own transition to TSA. To that aim, representatives of both countries worked on a MoU detailing the terms and scope of the co-operation”.
Highlighting the essence of the understanding, she said: “In a nutshell, the co-operation 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.”
The minister said, “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 who 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.”
Judging by the passion showned so far by The Gambia, the Minister advised the country thus: “To start with, as with all governance reforms, you need strong political support to deal with the heavy lifting that comes with PFM reforms.
“Do not embark on this journey if you are not confident that you have the buy-in of your topmost political leadership. It is the most potent antidote against the several headwinds that will try to undermine and derail your reform effort”.
Speaking further, she said: “Next in line is to assemble the right team of competent and committed reformers with in-depth knowledge of PFM. Upon that team will rest the responsibility of translating policy into action and by so doing, ensuring that your TSA expectations are met. There are more factors at play. You need, for instance, the financial resources and an enabling environment to drive reforms.
“The importance of the synergy between the fiscal and monetary authorities, she also said, cannot be over-emphasised. Equally important, according to her, is the co-operation of other stakeholders: the parliament; the ministries, departments and agencies of government; the banks and service providers.
“Above all, the general public, on whose behalf government exists and manages public funds, must be convinced that TSA and other reforms are being implemented in their interest and for the good of the country.
“As is the case in Nigeria, when you have their support, they will take it upon themselves to be against forces of resistance and any attempt at derailing the reforms,” she further advised.
Responding on behalf of the visiting delegation, Ms. Ada Gaye, Permanent Secretary, Ministry of Finance of The Gambia, expressed delight to be in Nigeria to sign the MoU, adding that the tour has helped them to understand the workings of the TSA better.
“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.
“We are going to create the needed sensitisation to help the people of The Gambia understand the process. Nigeria is the big brother while The Gambia is the small brother. We are happy to cement this brotherly love.”
Also speaking, the Gambian High Commissioner to Nigeria, Amadou Sheikh Oman Taal, said Nigeria is a big example within the Economic Community of West African States (ECOWAS) region.
“We are trying to make reforms in our financial management. Therefore, this collaboration with Nigeria is very important to us. So, The Gambia Central Bank will get closer to the Central Bank of Nigeria (CBN) so as to learn and get the necessary experience,” he said.
Representatives of the Accountant General of the Federation (AGF), Governor of the Central Bank of Nigeria (CBN), and the Accountant General of The Gambia, among other officials, witnessed the signing of the MOU.