THE EFFECT OF TREASURY SINGLE ACCOUNT ON PUBLIC SECTOR MANAGEMENT IN NIGERIA (A CASE STUDY OF NNPC ABIA STATE)
ABSTRACT
This study examined The Effect of Treasury Single Account on Public Sector Management. However, treasury single account according to CBN handbook (2015;57) defines it as a public accounting system under which all government revenue, receipts and income are collected into one account usually maintained by the Central Bank of Nigeria. The researcher of this work will bring into bare the impact of treasury single account on public service delivery. The theoretical framework that will be used for this study is Neoclassical theory which brings to fore the problems of underdevelopment in third world countries as internally induced phenomena caused mainly excessive government interventions and poor economic policies. Relevant and related literature will be reviewed to uncover the relevance of TSA and its impact on public service delivery. The research method that will be adopted is the survey method because the researcher saw a need to understand how government agencies spend in line with duly approved budget provisions. This method is concerned with the structuring and administering questionnaire. The questionnaire will be administered to the sample of the study. The sample will be derived from the population of the staff of FIRS Enugu branch using Taro Yamani formula. The analysis draft were done using tables, frequencies and research questions. In summary of findings, it was discovered that TSA to an extent has increased public service delivery in Nigeria and also reduced the level of corruption and equally increased Government revenue base in Nigeria. It is recommended that government should enact laws which will eliminate corruption and also government should disburse fund in accordance to the provisions of the budgets and lastly government should monitor their MDA's to make sure they remit all the funds they collected at the end of every financial day. Conclusively, treasury single account is regarded as a "blood tonic boost to the economy of Nigeria in no distant future.
CHAPTER ONE
      INTRODUCTION
1.1    Background and Need of the Study  
Earlier in February 2012, the Central Bank of Nigeria issued a circular directing all deposit money banks to implement the Remita e-Collection Platform. The Remita e-Collection is a technology platform deployed by the Federal Government to support the collection and remittance of all government revenue to a Consolidated Account domiciled with the CBN. This marked the beginning of the full implementation of Treasury Single Account (TSA) system in Nigeria.
Though Section 80 (1) of the 1999 Constitution as amended states "All revenues, or other monies raised or received by the Federation (not being revenues or other monies payable under this Constitution or any Act of the National Assembly into any other public fund of the Federation established for a specific purpose) shall be paid into and form one Consolidated Revenue Fund of the Federation"; Successive Governments have continued to operate multiple accounts for the collection and spending of government revenue in flagrant disregard to the provision of the constitution which requires that all government revenues be remitted into a single account.
It was not until 2012 that government ran a pilot scheme for a single account using 217 ministries, department and agencies as a test case. The pilot scheme saved the country about N500 billion in frivolous spending. The success of the pilot scheme motivated the government to fully implement TSA, leading to the directives to banks to implement the technology platform that will help accommodate all MDA's in the TSA scheme-Akande (2015:49). The recent directives by President Mohammed Buhari that all government revenues should be remitted to a Treasury Single Account is in consonance with this programme and in compliance with the provisions of the 1999 constitution.
But what is Treasury Single Account?
In a nutshell, a Treasury Single Account is a public accounting system under which all government revenue, receipts and income and collected into one single account, usually maintained by the country's Central Bank and all payments done through this account-CBN (2014:102). The purpose is primarily to ensure accountability of government revenue, enhance transparency and avoid misappropriation of public funds. The maintenance of a Treasury Single Account will help to ensure proper cash management by eliminating idle funds usually left with different commercial banks and in a way enhance reconciliation of revenue-e-collection platform.
Operational Mechanism
With particular reference to Nigeria, the Central Bank has opened a Consolidated Revenue Account to receive all government revenue and effect payments through this account. This is the Treasury Single Account. All Ministries, Departments and Agencies are expected to remit their revenue collections to this account through the individual commercial banks who act as collection agents. This means that the money deposit banks will continue to maintain revenue collection accounts for MDA's but all monies collected by these banks will have to be remitted to the Consolidated Revenue Accounts with the CBN at the end of each banking day. In other words, MDA's accounts with money deposit banks must be zeroed at the end of every banking day by a complete remittance to the TSA of all revenues collected. The implication is that banks will no longer have access to the float provided by the accounts they maintained for the MDA's. Difference types of account could be maintained under a TSA arrangement and these may include the TSA main account, subsidiary or sub-accounts, transaction accounts and zero balance account. Other types of accounts that could be operated include imprest accounts, transit accounts and correspondence accounts. These accounts are maintained for transaction purposes for funds flowing in and out of the TSA.
Benefits of TSA
From the foregoing, it is obvious that the primary benefit of a TSA is the mechanism it provides for proper monitoring of government receipts and expenditure. In the Nigerian case, it will help to block most if not all the leakages that have been the bane of the growth of the economy. We have a situation where some MDA's manage their finances like independent empire and remit limited revenue to government treasuries. In Iroegbu (2015:50) stated that under a properly run TSA, this is not possible as agencies of government are meant to spend in line with duly approved budget provisions. The maintenance of a single account for government will enable the Ministry of Finance monitor fund flow as no agency of government is allowed to maintain any operational bank account outside the oversight of the ministry of finance.
Improved Public Finance Management.
Finally, the Implementation of this programme is a critical step towards curbing corruption in public finance. This is in line with the commitment of the current administration to combat corrupt practices, eliminate indiscipline in public finance and ensure adequate fund flow that will be channeled to critical sectors of the economy to catalyze development. Nigerians are excited at the directive by President Buhari as this will mean that some government agencies that have been known to be withholding funds from the Federal Government are now under compulsion to remit monies to federal treasuries. These agencies include: Nigeria Customs Service (NCS), Nigerian National Petroleum Corporation (NNPC), Nigerian Ports Authority (NPA), Federal Inland Revenue Service (FIRS), Nigeria Immigration Service (NIMS), Nigerian Maritime Administration and Safety Agency (NIMASA), Federal Airport Authority of Nigeria (FAAN) amongst others.
In sun newspaper 19th December (2015:9) explains that TSA is bound to improve transparency and accountability in Public Financial Management. First, it will remove organizational/MDA secrecy around the management of public finances. The second is that revenue generating agencies that have been depriving the Treasury of due revenue through a plethora of bank accounts under their purview unknown to the authorities will no longer be able to defraud government since all funds will be swept into the TSA. Thus, beyond transparency and accountability, the TSA will introduce economy and efficiency into overall management of public finances and this will in the long run lead to effectiveness of government spending since it places the government in a better position to realize overall policy goals (White, 2006:118).
Vanguard Newspaper 22 December (2015:20) stressed that for TSA policy to be maximized in Nigeria, it needs to be accompanied with the Fiscal Sunshine Bill, which is enacted will open up the financial activities of government in a way that there will be no more hiding place for those who divert or loot government money. For instance, with Fiscal Sunshine Act in place, budgeting process and implementation, including contract awards, should be in the open for Nigerians to see both how revenues are generated and how public money is being spent by those in the government.
Enhancement Tools for Efficient Public Financial Management
The approval of the cash management policy document by the Federal Executive Council for implementation will strengthen Federal Government cash management for better budget implementation and service delivery.
Therefore, the effectiveness and efficiency of TSA can be achieved if the following cash management policy documents are strictly implemented and monitored: Government Integrated Financial Management Information System (GIFMIS): GIFMIS is an IT based system for budget management and accounting being implemented by the Federal Government to improve public expenditure management. The purpose is to enhance greater accountability and transparency across ministries and agencies. The overall objective Is to implement an efficient, effective and user-friendly computerized financial Management information System to increase the ability of the Federal Government to undertake central control and monitoring of expenditure and receipts in the MAD'S-Azimazi (2015:18) Guardian Newspaper.
Automated Accounting Transaction Recording and Reporting System (ATRRS): The ATRRS is a software designed in the Treasury to capture all financial transactions in all the MDAs and other arms of government.
Its primary purpose is to file accounting returns to the office of the Accountant-General of the Federation. These returns, independent Revenue collected, transcript of account, bank reconciliation statement and outstanding advances. It also ensures production of timely, and reliable financial statements, promoting budgets monitoring and performance, and, finally, enhancing transparency, accountability and probity in the management of public funds. ATRRS Accounting software has multiple Benefits which include: Familiarizes the workforce with the use of IT equipment at an early stage of the government integrated Financial Management information System (GIFMIS) implementation, which would enable a smoother transition to the GIFMIS software: potentially reduce training period and requirement for GIFMIS: Potentially reduce GIFMIS implementation cost: shorten Business Process re-engineering period (i.e. it is faster to transit from a semi-automated process than a manual process; facilitates ease of reconciliation of the various bank Accounts; ensures that clean and accurate data will be available for migration in to GIFMIS.
Integrated Personnel and Payroll Information System (IPPIS): This is a centralized computer based payroll and management system aimed at elimination of payroll fraud:
It has as its focus, the determination of the actual personnel cost at a glance, it a also aimed at ensuring data integrity towards ensuring that personnel information is correct and intact.
1.2    Statement of Problem
As a matter of fact the researcher was motivated to carryout this topic on the Effect of Treasury Single Account (TSA) to find out its effect on Nigerian economy. Therefore, all deposit money banks stand to lose immensely from the implementation of TSA, This is because of the fact that public sector funds constitute a large chunk of commercial banks deposit. Indeed, it is estimated that commercial banks hold about N2.2 trillion public sector funds at the beginning of sector quarter of 2015. The impact of this amount of money leaving the system can be imagined when one considers the fact that each time the monthly federal allocation is released by FAAC, the banking system is usually a washed with liquidity and as soon as this public sector funds dries up through withdrawal by the states, liquidity tightens again with interbank rates going up. Of major impact will be the movement of funds of revenue generating parastatals such as the NNPC, out of commercial banks. In the coming months, we see a return of deposit 'wars' amongst banks as each DMB devices means of mobilizing funds from the private sector. We see a return of the era when women are employed by banks specifically for deposit mobilization and tacitly encouraged to use any means necessary to get funds. We see increase in deposit interest rates as a major means of inducing customers and most importantly we see a drop in lending and in the profitability of banks, at least, in the short to medium term until they fully come to terms with the impact of the policy and begin to properly position themselves for true banking business. Ultimately, we see the share price of these banks falling as investors attempt to price in the policy impact.
1.3    Objective of the Study
The research work is directed towards establishing the nature of treasury single account in Nigeria. The impact and the level which they have attained their effectiveness. Therefore, the following objectives where formulated to guide the study.
l.    To find out how treasury single account improves public service delivery in Nigeria.
2.    To examine how TSA scheme will reduce the concept of
corruption in the country.
3.    To investigate how T.S.A will affect the growth of Nigerians
economy.
1.4    Significance of the Study
The study will be significant mainly to Federal Government of Nigeria, Central Bank of Nigeria (CBN) and other commercial Banks that work in partnership. Treasury Single Account was initiated to improve transparency and accountability in public financial management. It will remove organizational secrecy around the management of public finances. Also, the revenue generating agencies that have been depriving the treasury of due revenue a plethora of bank account under their purview to the unknown to the authorities will no longer be able to defraud government, since all funds will be swept into TSA.
1.5    Research Questions
Based on the objective of the study, the following research questions were formulated to guide the study.
1.    How   will   treasury   single   account   (TSA)   improve   public service delivery in Nigeria?
2.    How will TSA scheme reduce the corrupt practice in Nigeria?
3.    What are the effect of T.S.A to the economic growth in
Nigeria?
1.6    Hypothesis
1.    There is significance in treasury single account (TSA) in improving public service delivery in Nigeria.
2.    There is significance in TSA scheme in reducing the corrupt practice in Nigeria.
3.    There is significant effect of TSA to the economic growth in Nigeria.
 1.7  Scope of Study
The study is on the effect of treasury single Account on public sector management in Nigeria (A case study of NNPC Abia State)
1.8    Limitations of the Study
In the process of collection of data, the researcher had a lot of problems and they tend to curtail the availability of information from appropriate offices. The outstanding problems encountered by the researcher were as follows;
a.    Limited fund:- The money needed  by the researcher to
travel and buy relevant papers was not sufficient.
b.    Time constraint: This research was conducted at the time when school was on session and because of this, there was not enough time as the time was shared between academic activities and the research. All these aforementioned had a good limitation on this research.
1.9 Definition of Terms
CBN: Central Bank of Nigeria
T.S.A: Treasury Single Account.
NGO: Non Governmental Organizations PFM: Public Financial Management.