Abstract
This study presents an analysis of the history of official corruption in colonial Nigeria based on the requirements of Nigerian laws against corruption and the actual reporting of corruption cases made by the Director of Audit from 1950–1960. It reveals that many of the proven cases of fraud were however not sanctioned as required by law and that this laid the foundation for a culture of impunity in the management of public resources in the immediate post-independence period. The paper concludes that cases of corrupt acts could probably have been mitigated had the due processes of financial reporting been strictly followed.
Introduction
Corruption afflicts not only the public but also private spheres of life because it works directly against the moral and legal codes of honesty, prudence and accountability. In the public sector however, attempts at removing corruption are usually made through the enactment of legal frameworks designed to prohibit that act. But in private life, many African societies do make corruption a moral burden, the successful discharge of which elevates a person to the level of social approval and adulation. However when corruption happens in the public sector, the injury it levies on the collective interest and psyche of the society is more fundamental. This is because corrupt acts do not just destroy the moral basis of a society but, in addition, they ridicule its values and break its laws.
Hence, many states across the world have established veritable legal and institutional frameworks that can serve as the social ombudsman for deterring corruption by blowing the whistle on corrupt acts and for ensuring that they are punished. 1 These frameworks define the rules of the game, which may be called the rules of accountability for public officers. The rules make it imperative for public officers to bring their conduct in conformity with prescribed accountability standards whenever they deliver public goods to their societies. But, when the appropriate accountability frameworks are non-existent or weak, a regime of a free rein of all manner of corrupt acts ensues. The society becomes, generally, the loser and the citizenry, the collateral victim.
However, attempts by some authors at linking corrupt acts to some cultural, racial or even class factors, which presumably predispose a person to being corrupt is not likely to be a profitable academic exercise (Brownsberger, 1983: 215–233; Ekpo, 1996: 161–188; Rose-Ackerman, 1997: 35–37),because it may miss the point or fail to properly address the issue. It is rather more useful, to analyse corruption in terms of systemic variables within a socio- political structure such as the strength of the legal system, the network and weight of sanctions built up against corrupt acts and, the established adjudicatory systems which have been developed to discourage or punish corrupt acts. This approach, which this study adopts, is better because there is evidence to show that in societies where corrupt acts are not endemic, greater institutional and legal zeal have been deliberately and systematically installed to strip corrupt behaviour of its gains. This has been achieved on the one hand, by making sanctions on every corrupt offerings very robust, weighty and consistently enforced; and on the other hand, by ensuring that substantial compensation is given to anyone who chooses to expose corrupt acts to the public.
Conceptual and theoretical issues on corruption and accountability
Corruption is a social vice that confers some rewards (tangible or intangible) on perpetrators at the expense of their victims, be they individuals or sovereign states. The vice grows only in an environment where accountability has failed. Nations with accountable governments seek to abolish corruption by enacting laws that prohibit it or laws that make it impossible for its perpetrators to benefit from its proceeds.
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Such prohibitive laws on corruption are commonly regarded as laws for accountability and prudence in government. This explains why it is customary for scholars to discuss corruption side-by-side with the idea of accountability and the due process of law (Obilade and Braxton, 1994; Shyllon, 1986; Akinseye-George, 2000). However, it is not always easy to define corruption. In fact, under Nigeria’s Criminal Code
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and the Criminal Procedure Act,
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both of which prohibit and seek to punish corruption, the concept is not defined. Section 112(1) of the Criminal Code, for instance, only points to what may be partly described as a corrupt act. It provides: Any person who – (1) corruptly asks, receives, or obtain any property or benefit of any kind for himself or any other person on account of anything already done or omitted to be done, or to be afterwards done or omitted to be done, by him or any other person, with regard to the appointment or contemplated appointment of any person to any office or employment in the public service, or with regard to any application by any person for employment in the public service; or (2) corruptly gives, confers, or procures or promises or offers to give or confer, or to procure or attempt to procure, to confer upon, or for any person, any property or benefit of any kind or account of any such act or omission; is guilty of a felony, and is liable to imprisonment for three years.
The above long and windy provision only shows a set of actions that may be punishable under the Criminal Code as corrupt acts, but it still fails to reveal what, exactly, ‘corruption’ means. At any rate, the Code’s description of what may be regarded as constituting corrupt acts is far from exhaustive. Conspicuously missing in the list are fraudulent practices which are peculiar to the handling of public finances such as unauthorised virement 5 of funds in the public budget, deliberate over-padding of expenditure votes, fraudulent encashment of cheques, charging of private expenditure to the public treasury, outright refusal to answer audit queries on discrepancies in the record of public finances, etc. All these acts, which characterised Nigerian public finances in the colonial period and which amounted to lack of accountability in the implementation of the fiscal policies of the government, created and widened opportunities for corruption during the period. Again, and quite significantly, the description of corruption in the Code, omits – as is common today in post-independence Nigeria – electoral fraud, 6 such as over-voting, forgery of election result sheets and declaring a loser as winner in an election, which are by no means insignificant acts of corruption. The Code seems to concentrate on overt acts of giving and receiving material gratification while excluding other forms of reprehensible covert corrupt acts that may not involve material things but which are nonetheless subversive of public trust and assets.
Still, the more recently promulgated anti-corruption law – the Corrupt Practices and Other Related Offences Act, 2000 7 – does not offer any relief in the conceptual clarification of corruption. It only parrots, albeit in a more elegant drafting style, the contents of section 112(1) of the Criminal Code Act, as above. 8 It is at this juncture that recourse to simple working definitions offered by some scholars on the concept of corruption becomes apposite. Nye, for example, defines corruption as the ‘misapplication of public goods to private ends’ (Nye, 1967: 417) To Nye, corruption emanates from the planned circumvention of the due process with the intent to gaining personal or group advantage at the expense of the general good. In other words, corruption as it applies to the public service connotes every attempt and act made by a person to corner either material or intangible advantages to himself at the expense of the common good. This also explains why Lawal conceived the act as ‘an unsanctioned, illicit and unacceptable act…an unsanctioned use of public resources or goods for private ends’(Lawal, 2006: 3). It follows therefore that corruption will not thrive where the due process of accountability and integrity are upheld. That is, corruption is a direct evidence of the failure of accountability.
Onigu Otite (1983) gave a rather more sociological perspective to the definition of corruption using the peculiar Nigerian situation as case study.
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Hence, to Otite, Corruption simply means the perversion of integrity or state of affairs through bribery, favour, or moral depravity. This implies an original state or expectation of individual and societal purity. When at least two parties have interacted to change the structure or process of society or the behaviour of functionaries in order to produce dishonest, unfaithful or defiled situations, we may say that corruption has taken place (Otite, 1983: 11–12).
In other words, to Otite, corruption is that state at which two or more people seek to devalue, by changing to suit their perversion, the rule for the due process of doing things in a society. Such a perverted change is sought by corrupt people for the purposes of conferring certain benefits on themselves to the exclusion of those who observe the due process. This conception of corruption is in agreement with the view expressed earlier that corruption is a vice that can only exist where the process of accountability has been compromised or made to fail. But then, what is accountability?
It is much easier defining accountability than corruption. Accountability is conceived here as the observance of the due processes spelt out by either the laws or the conventions for the doing of a thing. This means that corruption negates accountability both in the public or the private sectors of a community. Accountability conveys a sense of the need to demonstrate honesty, integrity and transparency in whatever one does. 10 When applied to the management of public resources, accountability serves as a holistic word, embracing all forms of honesty, candour in providing explanations about the use of public moneys, vested political power and the influence of office.
The Sharman Committee, which was set up by the government of the United Kingdom to ‘consider suitable arrangements for the audit and accountability of central government in the 21st century on behalf of Parliament and the public’,
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concluded that accountability is ‘the requirement to provide explanations about stewardship of public money and how the money has been used’.
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Writing in 1997, the Auditor-General of Canada observed that accountability in the public sector requires, ‘an obligation to answer for the execution of one’s assigned responsibilities’.
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It is interesting to note that the definitions of accountability given by the Canadian Auditor-General and the Sharman Committee are in accord with the Aristotelian perspectives on the same concept, expressed more than 2000 years ago. For, as far back as 325 B.C., Aristotle conceived accountability as the most germane canon of behaviour in public finance management. He therefore gave the world a description of what the concept should mean in the public sector when he wrote: Some officials handle large sums of public money, it is therefore necessary to have other officials to receive and examine the accounts. These inspectors must administer no funds themselves. Different cities call them examiners, auditors scrutiners and public advocates (Aristotle, quoted in Mollenhoff, 1988: 125).
Accountability is essential if one must prevent fraud, theft and misapplication of resources particularly in the processes of generation and application of public funds. But it is not only in the generation and application of public funds that it should be relevant. That is why some scholars have identified different forms of accountability, namely: Political Accountability, 14 Legal Accountability, 15 Financial Accountability, 16 and so forth (Ijewere, 1999). The concept of accountability has been validly applied to the use of political power under the principles of separation of powers. In the 17th century the French philosopher, Baron de Montesquieu succeeded in popularising the idea of accountability in governance. He styled it, the principle of separation of powers. In his work L’Espirit des Lois, 17 Montesquieu defines and enumerates the requirements of political accountability: (1) that the powers of government to make, execute and adjudicate laws should be separated into three compartments, (2) that the powers of these compartments should be vested in the hands of three separate individuals/bodies and; (3) that no one should wield more than one of these powers, concurrently (Richter, 1977). Hence, to Montesquieu, power separation is necessary in order to avoid tyranny, oppression and the suppression of dissent. In other words, political accountability requires that public power is wielded in the best interests of the citizenry and not for personal aggrandisement. The same is needed to prevent tyranny of the rulers and freedom for the citizens.
Furthermore, much of Dicey’s work (Dicey, 1959) on the idea of the rule of law can be traced to a latent advocacy for legal accountability. That Dicey advocated that all should be equal before the law and that the actions of rulers be made subject to judicial review implies that he was an advocate of legal and judicial accountability. Legal accountability therefore entails observance of the due process of the law –that is, upholding the supremacy of the constitution; maintaining the presumption of an accused’s innocence until the contrary is proved; and governing according to known rules and regulations, 18 which prohibit arbitrariness and conviction without relevant facts or evidence.
It is important to reiterate here that corruption is a direct result of the failure of accountability and not the reverse. A person is corrupt because he is not accountable. Therefore, when corruption becomes manifest in any society, attempts at unearthing its root causes are better done when one focuses on the legal and institutional frameworks that the society has erected by which accountability, both in public and private spheres, may be enforced. Hence if corrupt acts become rampant it is either that the legal or institutional structures that exist to prevent them are either inadequate or they are simply inefficient in combating the menace.
Forms of financial corruption in colonial Nigeria
Corrupt acts that were committed in the period under review took diverse forms. These may be categorised into four groups, for ease of analysis: (1) corrupt acts committed in the discharge of expenditure duties, (2) corrupt acts committed on revenues, (3) outright disregard for established control and audit rules and (4) direct theft and fraud.
Corrupt acts committed on expenditure matters
The government of Nigeria drew its Annual Budgets based on receipts into the Consolidated Revenue Fund. Since the promulgation of the 1946 Constitution and the enactment of the Finance (Control and Management) Act, the principal laws for the control of Nigeria’s finances, the legislature had made it a criminal offence for any public official to spend any moneys, no matter how seemingly plausible, on any matter of government without the authority of the parliament. 19 Hence, the Appropriation Bill or the Supplementary Appropriation Bill remained the instrument by which public funds could be disbursed, legitimately. Even during emergencies, the same enactments provided strict guidelines and limits in respect of how the executive might, for reasons of contingencies disburse funds pending the authorisation of the legislature. In other words, any public officer who exceeded their expenditure vote or spent any money without the legislature’s prior consent, committed the offence of extra-legal spending and could thus face sanctions. 20
However, this legal framework and the oversight authority that went with it via the offices of the Director of Audit and the Public Accounts Committee of the Nigerian legislature were observed, most regrettably, in the breach than in compliance. In fact, many departments of government embarked upon expenditure without or in excess of Appropriation Acts. In many cases between 1953 and 1960, officers deliberately and in sheer disregard of the established authority for oversight duties, exceeded their expenditure votes by thousands and, at times, by millions of pounds, creating a very disquieting impact on the level of liquidity within the system and the dislocation of macro-economic indicators on which national budgets were based. Most of the dislocation laid the foundations for Nigeria’s budget deficit financing profile in post-independence Nigeria, which subsequently became a painful recurring decimal from that time up till the middle of the 1990s. Cases abound where excess budgetary spending accounted for as much as 10% of the recurrent expenditure and more than 40% of the capital expenditure built into the national budget between 1950 and 1960.
Table 1 shows, for example, the amount of excess spending over budgetary provisions from 1951 to 1961. In the 1951/52 financial year for instance, the sum of £2291-15s-6d was spent without any approval. In the following fiscal year, an even bigger amount of £51, 108-8s-11d was, again, spent without any expenditure warrant. The trend continued from that year up to the 1960/61 fiscal year, unabated.
Expenditure incurred and money spent without approval.
Sources: Compiled from the Report of the Director of Audit (1952, 21 1954, 22 1956 23 1959 24 and 1961 25 ).
Sterling currency pre-decimilisation.
The Director of Audit, in several Reports on the accounts of the government, particularly the reports for the years 1954, 1955 and 1957, pointed out the improper acts of spending in excess of budgetary authority or even in total contravention of it; but no relief came his way by way of the appropriate government enforcement agencies ensuring that indicted officers were sanctioned. In fact, as shown in Table 1, from a little over £2000 in the 1951/52 fiscal year, extra-budgetary expenditure actually climbed to as high as £900,006 in the 1954/55 fiscal year. The same extra-budgetary expenditure was £915,114-11s-6d in the following year, although the amount declined to £612,000 in the 1956/57 fiscal year; but in the following fiscal year (1957/58), an unprecedented amount of £7,207,356 was spent without approval. This record was however, broken in the 1958/59 fiscal year when the sum of £7,462,568-1s-0d was disbursed without authority. However, in the 1959/60 fiscal year, unauthorised expenditure declined significantly by more than £4 million to stand at £2,795,807 6s 9d; but the trend was not sustained, as unauthorised expenditure again climbed higher to £6,110,112-0s-0d in the following year (1960/61), which was the fiscal year that marked Nigeria’s independence, .
Forgery and theft
Corrupt dealings with the revenues of government intensified as the decolonisation process advanced towards independence in 1960. Forgery of government cheques and vouchers was another form of corruption that was perpetrated in the period under review. This again led to fraudulent encashment and embezzlement. Account officers, particularly in the Department of Customs and Excise diverted public funds into private pockets via double payment of bills and direct theft of public moneys. Tables 2 and 3 show selected cases of these forms of fraudulent acts and the losses they brought upon the Nigerian treasury. For example, as shown in Table 2, from 1951 to 1957 cases of fraudulent encashment of money orders, cheques and forged payment vouchers were committed in the Posts and Telegraphs Services Department in Lagos and Aba, as well as in the Chief Secretary’s Office, Lagos. 26 Other high offices of government involved in the fraud included the: Accountant-General’s Office in Lagos, Public Works Department for the Northern Region, Nigeria Police Force Office in Ibadan and the Department of Medical Services, Lagos and of the Surveyor-General, Jos. Combined financial losses suffered by the government as a result of these frauds amounted to £13, 527 0s 1d, in the selected years.
Fraud due to theft and forgeries, 1950–1958.
Source: compiled from the Report of the Director of Federal Audit, 1954 and 1960.
Frauds in the Posts and Telegraphs Department, 1950–1958.
Sources: (1) compiled from the Report of the Director of Federal Audit, 1954 and 1960.
(2) Report of the Accountant-General of the Federation Together with Financial Statements for the Year Ended, 31 March,1959.
Still, the worst form of fraud, which is of particular interest to this study both in terms of the volume of cases involved and the value of cash lost by government, was committed by way of forgeries of cheques and payment vouchers. In 1951 alone, as shown in Table 2, forged payment vouchers of the government of Northern Region led to a combined loss of £5, 400. In 1952, in the Department of Posts and Telegraphs, Lagos, fraudulent public officers forged money orders with a total value of £4,409-15s-7d. The office of the Accountant-General of the Federation in Lagos was not spared of the forgeries. Fraudulent officials caused the government a loss of £1,874-19s-0d, 27 through forged payment vouchers at the sub-treasury in Ebute Metta. The amount was the third largest sum lost to forgery between 1951 and 1957. In the Department of Prisons, Warri, forgery of payment vouchers also made government to suffer a loss of £1, 062 11s 3d, in 1953. And, again in Ibadan, in 1957, a loss of £52 9s 2d was recorded at the Police Department, due to forgery of payment vouchers.
It should be noted that when it came to the matter of forgery of cheques and fraudulent encashment, the culprits only usually succeeded in stealing much smaller amounts compared to forgery of payment vouchers. For example, at the office of the Chief Secretary to the Colonial Government in Lagos, in 1954, the two cases of theft and forgery of government cheques only led to a combined loss of just £35 28 compared to a loss of over £1062 29 a year earlier due to forged payment vouchers at Warri Prisons. This fact can only be interpreted to mean that account officers were far more careless with the process of verification of the authenticity of payment vouchers than they were with the safe custody of cheques and money orders.
Table 3 shows other cases of embezzlement of public funds via direct theft of cash from treasury as well as from fraudulent withdrawals from public accounts. Cases of such thefts and unaccountable acts which were perpetrated mostly in the Posts and Telegraphs (P&T) Department than in any other government departments have been classified here separately from those that arose from forgeries simply for ease of analysis and to show the comparative weight of such fraud in relation to other fraudulent acts committed in other departments of government. In Table 3 the selected cases of frauds, theft and embezzlement in the department between 1950 and 1958 led to a loss of £14,023-4s-9d. Three cases were particularly more serious in terms of the value of losses. These were the theft of cash and parcels in 1952 in Lagos where the government lost the sum of £3023-11s-9d, the loss of £5650 at Aba due to fraudulent withdrawals in 1955 from the Post Office Savings Bank (POSB) by an Officer of P&T and the loss of the sum of £2357-13s-5d in Jos, in 1958, due to fraudulent payment vouchers raised, again, by a member of staff of the P&T. Other losses were by no means less important but these three show the magnitude of fraud that government officials committed against the department in which they worked.
Further cases of embezzlement and misappropriation committed by public officers are shown in Table 4 which presents a sundry list of general cases from several government departments that involved small amounts, except those concerning outright misappropriation. The increased and sustained tempo of corrupt conversion of public moneys shown in Table 4 tends to suggests that with the planned exit of colonial rule public officials became more eager to grab as much as they could from government in a sort of a last minute rush to steal from the public treasury. Thus, public officials in virtually all departments of government either forged vouchers or stole cash from government purses with impunity. Hospital clerks, airport officials, customs and school treasury/bursary officers misappropriated varying sums of money from government coffers in sheer disregard of extant laws and regulations which guided the application of public funds.
Sundry frauds due to embezzlement and misappropriation, 1950–1960.
Source: compiled from the Report of the Director of Federal Audit, 1954, 1955, 1956 and 1960.
For amounts above £7.
Table 4 shows that a total of £25,463-17s-1d was corruptly removed from government coffers by way of misappropriation, theft, fraudulent claims and embezzlement. In the Judicial Department for example, the sum of £621 2s 6d was misappropriated in a court in Ebute Metta in 1951. The following year, at King’s College, Lagos, a clerk stole the sum of £225 19s 2d. The office of the Administrator General too was not spared of the fraud, with the substantial sum of £5,973-12s-7d being misappropriated there in 1955. In the Customs and Excise Department and in the Ministry of Finance, both in Lagos, the separate sums of £3853-13s-4d and £9702-18s-6d were misappropriated, respectively, from these two agencies of government. In all, and as shown in Table 4, the selected cases of improper dealings with the accounts and assets of the government of colonial Nigeria cost the government a total loss of £25, 463 17s 1d, in the period 1951–1960.
Frauds committed on revenue matters
It was not only in the processes of revenue collection that corrupt acts were perpetrated by public officials in the colonial period. There were also cases where, in the actual disbursement of funds for expenditure activities, fraudulent officials dealt with public revenues in such a way that caused government to incur huge losses in both cash and stores. In fact, there was a particularly reprehensible act of a court registrar stealing the cash exhibit put in his care, a theft that government had to underwrite using public resources. 30 Table 5 shows cases of significant losses as a result of fraudulent practices in the course of revenue management from the 1945/46 fiscal year to 1959/60. The fraudulent practices were due mostly to double payments for work done by contractors, 31 refusal by public officials to retire unspent funds to treasury 32 in sheer disregard of extant rules, over-invoicing and inflation of contract sums as well as outright theft of moneys earmarked for government services. 33
Losses arising from disregard of extant rules on fiscal management.
Sources: compiled from the Report of the Director of Federal Audit, 1955, 1956 and 1960.
In the 1945/46 fiscal year and as shown in Table 5, there were six cases of fraudulent dealings with the revenue budget of government. This led to a loss of £280 by the government in that year. In the following year, cases of theft increased by more than 50% to nine, when the government again lost a total of £662 to fraudulent claimants. But cases of fraud in the 1947/48 and 1948/49 fiscal years dropped marginally toeight, each. The combined loss of money in the two cases was only £153. However, from the 1949/50 to the 1959/60 fiscal years, cases of corruption in the revenue budget process rose sharply both in incidence and value. For example, whereas in the 1949/50 fiscal year, incidences of losses due to fraudulent acts totalled 10, in the 1951/52, 1953/54, 1955/56 and 1957/58, they were, respectively, 30, 37, 40 and 52. In 1960, the year of Nigeria’s independence, reported cases of losses of cash was as high as 99. Hence, the combined monetary value of losses in the years presented in the Table 5 was a substantial £189,654. It is interesting to note that the sums of money sequestrated from government treasury in all the aforementioned cases of fraud were never recovered from the culprits rather, they were written-off by government as losses to the Consolidated Revenue Fund/Account. 34
Conditions permitting the failure of accountability in colonial Nigeria
In the period under review, accountability failed because a number of fiscal laws which could have permitted its observance were not enforced. Hence funds were illegally transferred and expended on projects and services that had no budget backing. Many statutorily required documents, such as vouchers which provided evidence of receipt of and payment for government services and projects and by which the use of government funds could be monitored, were often reported as ‘disappeared’ or lost without any trace. 35 Indicted account officers who were responsible for such disappearances were often not sanctioned. In fact, when audit queries were raised about the detection of frauds and embezzlement, indicted officers refused to answer the queries, 36 rebuffing the Director of Audit who had the statutory authority to issue such queries. In this section of the paper, I describe the conditions which devalued the rules of accountability in the management of Nigeria’s finances in the period under review. I also explain why the corruption which those conditions fostered could not be halted.
Disregard for financial rules and regulations
Disregard for fiscal rules and regulations was the most debilitating of all the acts of non-accountability in the fiscal management of Nigeria in the period under review. A case-study will be used to illustrate this, that of the operation of the Nigerian Mission in the United Kingdom (UK) and the Nigerian Consulate in Fernando Po.
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In respect of the Mission in the UK, the office of the Commissioner was discovered to have embarked on a most inappropriate expenditure that fostered corruption. The discovery was made in respect of loans and grants to Nigerian students studying abroad.
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It was revealed that apart from the over-padding of figures of claims, the Commissioner illegally charged some expenditure to the ‘Expenditure Head No. 23, section B’ of the 1957/58 budget of the Mission.
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Apart from the fact that the charge was illegal, the Commissioner could not produce any voucher to show that the expenditure was actually made.
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The Commissioner paid out moneys, which ran into tens of pounds every year without vouchers and this had been happening for several years before the discovery. As a result of this improper method of handling public funds, the then Director of Federal Audit, in his 1958 Report, wrote: . . . . It appears that the normal expenditure internal controls were either not being applied or did not operate satisfactorily during the year. As a result, to a considerable degree, it was not possible to establish satisfactorily in audit that certain of the expenditure was a proper charge to public funds at the rates and to the extent that payments were made.
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The expenditure which the Auditor referred to in his report and which he regarded as not having qualified as ‘proper charges’ to public funds included ‘some £660 to individuals for purposes described variously as “grant towards Paris tour”, “foreign tour”, “summer tour of Italy”’, 42 etc. Also included in what the Auditor found as charges to public treasury were payments to the Nigerian Union, amounting to some £546 in respect of expenses of dinners, dances, Christmas and tea parties. 43 It is noteworthy to state that similar payments were charged to expenditure votes in the accounts for the succeeding fiscal year, 1958/59, without the Commissioner clarifying or acquitting himself of the earlier improper charges. And, as if to show that his report and comments above were a gross understatement of the illegality and severity of the Commissioner’s charges, the Auditor cross-checked and compared all the purported payments with the expenditure budget approved for the Mission, including the supplementary estimates for the fiscal year, 1958/59 and found that no such events that the Commissioner claimed he paid for appeared under any appropriation authority, nor were they included in the warrant to incur expenditure issued by the Minister of Finance. In other words, the Honourable Commissioner had, at least as the 1958/59 and 1959/60 fiscal years were concerned, embarked upon expenditure clearly outside budgetary authorisation.
Apart from this reckless expenditure, what the Auditor reported as most disturbing was the apparent ‘kid gloves’ with which the matter was treated. At any rate, to describe an expenditure made by anyone in the public sector, no matter for what purpose and howsoever urgent, as ‘unvouched’, as the Auditor did, 44 is no more than a euphemism for theft. When a senior public official made such an expenditure and the institutional oversight authorities refused to sanction him, then it would not be strange if such a refusal opened a floodgate for other even more daring thefts by lower cadre officers who would have seen a precedent in the refusal to bring culprits to book. When people realised that no sanctions would be incurred for lack of accountability, they naturally embarked on more fraudulent and corrupt acts.
It is therefore no wonder why the same Commissioner, in the Auditor’s report of the succeeding year, was recorded as having spent another sum, of £293-19s-0d, on unauthorised ‘local leave, spent in Paris’. 45 The only documented response of the Prime Minister’s Office to this particular expenditure was a recommendation to the Governor-General that a proportion of the said sum be surcharged to the Commissioner and that the balance be written off as losses 46 under the accounts for the fiscal year 1957/58. What is more, an audit inspection of the Commissioner’s office in London in October 1957 showed that his cashbook had not been written up for a month and ‘a number of other records were incomplete or unsatisfactory’. 47
Disappearance of vouchers and illegal transfer of funds
Another precipitate condition for the lack of accountability in the period under study was the disappearance of vouchers and illegal transfer of funds. In the Nigerian public sector during the colonial period, there were usually three types of vouchers: (a) the Payment Voucher. (b) the Receipt Voucher and (c) the Adjustment Voucher. In the 1952/53 fiscal year, 1596 vouchers could not be traced, 48 while in the 1953/54 and 1956/57 fiscal years a total of 4332 vouchers for the payment of mainly contractors and expatriates were missing. 49 In the 1957/58 fiscal year alone, 4313 vouchers could not be traced. The significance of a lost or missing voucher can never be lost on the supervisory authority in a responsible public or private establishment. A voucher, as a document providing evidence of receipt of money from a payee, is a document that can be used to trace the movement of government expenditures. It is on record that the Public Accounts Committee did not sanction, even once, the office of the Accountant-General of the Federation for refusing or deliberately delaying replies to audit queries in respect of lost vouchers.
Evidence abounds that unvouched extra-expenses were made by some Departments who charged these expenses illegally to surpluses in the miscellaneous accounts held by them. Ordinarily, this practice, called ‘virement’, could have been permitted if the Minister of Finance issued the appropriate warrant for such charges. But even with that, the expenses still had to be supported by vouchers and, especially, Adjustment Vouchers. To have allowed such transfers of surpluses from one account to pay for the deficit in the other meant that the account officers were not following the principle of accountability as enshrined in the 1951 John Macpherson’s Constitution. A clear instance of illegal transfer of moneys and illegal virement was identified in the 1953/54 fiscal year when one Mr JE Barker, who was then the Director of Federal Audit, complained of this in his 1954 Report when he wrote: It was observed during the examination of the 1953/54 Posts and Telegraphs accounts that £449-19s-0d of unvouched expenditure in various Postmaster’s Cash Accounts had been charged to a Miscellaneous surplus Account. This practice appears to be not only incorrect, but also a potential source of loss of public funds.
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Whereas Mr. Barker had regarded this illegal transfer as capable of being ‘a potential source of loss’ to the national treasury, his fear was later confirmed in the audit of the account of the Marriage Registry at Sant Anna Courts. 51 As a result of untraced vouchers, the sum of £4675 was lost by the courts being moneys earned from fines and other fees of court. 52 In the same vein, in 1955 the account deposits of the Colonial Development and Welfare Schemes, involving a sum of £449,524-16s-4d, could not be located because records of such payments disappeared from the office of the Accountant-General. 53 The resultant affect which all these non-accountable acts had on the treasury was that large sums of money had to be written off as either uncollectable or lost altogether.
Refusal to answer audit queries
The auditsof government revenue and expenditure from 1945 to 1960 reveal a large volume of unvouched payments about which audit queries were raised by the Director of Federal Audit. But unfortunately, public officers – and especially senior public officials – hardly replied to those audit queries. In fact, beginning in the 1945/46 through to the 1959/60 fiscal years, as shown in Table 6, 15,492 audit queries were left unanswered by the relevant public officials. Whereas only 40 queries were unanswered in the 1945/46 fiscal year, in the 1948/49, 1951/52, 1955/56 and the 1958/59 fiscal years, totals of 230, 430, 1840 and 2400 audit queries respectively, were not answered. In the fiscal year which coincided with Nigeria’s independence, 2840 audit queries remained unanswered in various government departments, despite the fact that these queries were about glaring cases of theft and embezzlement of public funds via illegal virement and theft of stores. 54
Unanswered audit queries, 1946–1960.
Sources: compiled from the Report of the Director of Federal Audit, 1948, 1955 and 1960.
Refusal/delays in prosecuting indicted officers
As have mentioned above, delays in or sheer refusal with regard to prosecuting public officials who were indicted of corruption negated the enforcement of the rules of accountability in colonial Nigeria. Even when corrupt acts were detected and reported the responsible ministries or departments tended to shield the culprits from appropriate sanctions or reprimand. They did this by withholding evidence of corrupt practices from prosecuting agencies. 55 This fact characterised responses to audit queries throughout the period covered by this study, but especially so from 1958 onwards after the ‘Nigerianisation’ 56 of the Department of Federal Audit. This formed a major source of disagreement between the office of the Director of Federal Audit and the Public Service Commission whose duty it was to discipline erring officers.I show here one particularly interesting case of how those responsible were dilatory in prosecuting those who corruptly dealt with public assets and blatantly disregarded the due process of public accountability. The case concerned the theft of funds in 1953 at the Inland Revenue Office, Ebute-Metta, involving the sum of £44. 57 Despite repeated reminders and pleas from the Audit Office, the Ministry of Finance, which had supervisory authority over the Inland Revenue Department, refused to set up a board of enquiry to investigate the theft, in spite of clear evidence of the culpability of the account clerk in charge. The Audit Office therefore went ahead to report the matter to the police and the suspect was arrested. However, for want of evidence (which the Finance Ministry refused to produce), the suspect was discharged on the 6 July 1954. 58 By 1955 when another audit query raised this issue, the suspect had already been covered by the strict legal rule against double jeopardy and hence he could not be brought for prosecution. Cases like this were reported every year from 1950 to 1960 by the Director of Audit, who expressed his complete helplessness in securing the prosecution of indicted officials.
Summary and conclusions
Corruption and different forms of non-accountable acts characterised the fiscal operations of Nigeria’s colonial administration from 1950 to 1960. The legal and institutional frameworks that were erected to ensure conformity with the best practices of fiscal prudence did not deter corrupt colonial officials from engaging in illegal virement, fraudulent conversion of public resources to serve private ends and sheer disregard of extant laws concerning the proper use of public moneys. From 1950 up to the time of independence in 1960 there seemed to be a heated competition among government departments and agencies for misuse of public funds while the legal provisions for inter-agency co-operation in detecting and prosecuting corrupt behaviours were observed more in the breach than in compliance. The resultant effect was that in the period concerned, government lost huge sums of money to forgeries, fraudulent encashment, embezzlement and outright theft of moneys from the treasury. Thus, a culture of non-accountability grew to constitute a most disturbing impediment to accurate financial accounting and fiscal responsibility of government to the governed.
Footnotes
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.