Zainab Ahmed-led finance ministry diverted funds into private accounts, paid for foreign trips without due process

THE Federal Ministry of Finance, Budget and National Planning during the era of Zainab Ahmed as its minister diverted public funds into private accounts and paid N266 million without proper documentation, an audit report on the ministry shows.

Zainab was the ministry’s leader between 2019 and 2023 under former President Muhammadu Buhari.

She served as the Minister of State for Budget and National Planning from 2015 to 2018 and the Minister of Finance from 2018 to 2019 before Buhari merged the two ministries in 2019 and made her its minister.

The latest audit report from the Office of the Auditor-General of the Federation (OAuGF) released in December 2023 and made public recently, listed six infractions perpetrated in the ministry under the ex-minister’s tenure in violation of extant laws.

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Some of the infractions exposed in the report include the diversion of payments into personal accounts, payment without vouchers and payment for foreign trips without following due process. The audit noted that all these were flagrant violations of extant laws.

Payments into personal account

According to the report, N45.2 million (N45,214,294) in favour of three different contractors was paid into the private account of an officer of the ministry.

“The sum of N4.2 million (N4,295,244) for equipping and installing office furniture in the main office of the Honourable Minister, Ministry of Budget and National Planning, was paid to the officer’s account through voucher No. MBNP/CAP/12/20 dated 18th May, 2020,” the audit reads.

The report stated that N3.9 million (N3,950,625) was paid into the same account instead of the contractor’s. However, the audit does not reveal the officer’s name.

“Payment for an insurance broker amounting to N12.9 million (N12,942,990) was paid into the officer’s GTB account instead of the broker’s bank account, and the sum of N24 million (N24,025,434) was paid to the same officer’s account instead of the actual contractor/beneficiary.” 

Payment made before raising vouchers

The audit also revealed that N13.8 million (N13,806,000) was paid for field data collection for the 2019 National INFRA Report through the GIFMIS payment platform on August 7 2020, and the payment voucher for the transaction was raised on August 10, 2020, three days after the payment was made.

The ministry admitted the infractions but said the actions were not taken to break the laws.

“Your observation in this regard is quite accurate. But please note that such payments were not made to break the rules as stated by the Financial Regulations and Extant Circulars, but only on occasions where urgent and immediate activities are to be carried out by the Ministry.

“Also note that these payments are usually backed with necessary approvals and authorisations, while relevant records are perfected as soon as the objective of such payments is achieved,” the ministry responded.

Payments for foreign trips without due process

The third issue raised against the ministry in the audit is the payment of N19.6 million for overseas trips without adherence to due process.

“There was no evidence to show that approvals were duly obtained from the head of the Civil Service of the Federation before payments were made as required by extant regulations,” the audit stated.

The audit also alleged that the ministry gave a contract to a company without going through the proper bidding process. Instead, it hid the costs by burying them in an existing maintenance contract instead of creating a new one.

The report noted that N4.1 million (N4,114,025) was paid for supplying and installing an executive loft corner adjustable office sofa set with throw pillows, coffee table with accessories and freight charges as reimbursable expenses.

It also revealed that N18.9 million (N18,969,169) was paid for work contracts, disbursed, and documented in the accounting records and GIFMIS payment platform as reimbursable expenses.

“Your information about the subsisting contract between the ministry and Oviswift Engineering Ltd. (formerly Annai Ltd.) to the tune of N35,270,072.26 is accurate,” the ministry confessed.

“However, it should be clearly stated that there is a reimbursable clause of a maximum of one million naira per month embedded in the contract agreement, which justifies the payment for all reimbursable expenses. Moreover, the ministry has taken adequate steps to constitute a four-man standing committee on reimbursable maintenance costs to ensure that all claims by Oviswift Ltd. are thoroughly scrutinised before payments.”

The audit observed that 14 vouchers amounting to N22.5 million (22,525,000) were paid to the ministry’s staff to disburse to other staff for purchasing premium motor spirit (PMS) for day-to-day use of the ministry’s official vehicles.

The audit noted that the action contravenes the provisions of extant regulations and the federal government policy on e-payment.

“These are allowances normally paid to departmental directors and heads of unit for running their official vehicles. Note that the stated amount above is a lump sum which comprises several approvals by the Permanent Secretary based on the relevant threshold.

“As part of the internal control measures in place, the internal audit unit ensures that beneficiaries retire amounts collected at the end of each period. This is to further underscore the importance of transparency and accountability in public financial management.

Cash advances paid without due documentation

The audit observed that N141.9 million (N141,971,777) was paid to the ministry’s officers as cash advances without being recorded in the ledger and register.

“Some were not retired as at the time of the audit, and multiple advances were also granted to staff without retiring the previous advances, in contravention of the provisions of extant regulations,” the report stated.

The ministry also admitted this but said the desk officer in charge of advances had been directed by the Department of Finance and Accounts to commence the retirement process by notifying relevant officers to do what was needed.

    “Extra steps have also been taken by the internal audit unit to ensure that no further advances are granted to such officers until all unretired advances are cleared,” the ministry added in her response.

    “As at the time of this response, over N90,000.000.00 of the unretired personal advance had been retired. This represents over 60 per cent. Samples of some of the retirement vouchers are attached for verification. Also, the management is making efforts to ensure that the balance of the unretired is retired as quickly as possible. Staff with unretired advances had been issued a final reminder for the retirement of their respective personal advances.”

    The audit attributed the observed infractions to weaknesses in the ministry’s internal control system, warning that they could result in loss and diversion of public funds and difficulty in funding the budget.

    The ICIR reports that Zainab (the former minister) bagged a World Bank job after her tenure with the Buhari administration ended on May 29, 2023.

    Nurudeen Akewushola is an investigative reporter and fact-checker with The ICIR. He believes courageous in-depth investigative reporting is the key to social justice, accountability and good governance in the society. You can shoot him a scoop via [email protected] and @NurudeenAkewus1 on Twitter.

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