Following a week of corruption scandal over the management of the Single Treasury Account (TSA) by the Buhari government, the managing director of the company in the eye of the storm has written a letter to President Muhammadu Buhari on the saga.
Systemspecs, the company that reportedly makes 1% of every amount paid in the TSA because it uses it payment platform, REMITA to collect the funds, says that there is a sharing agreement for the 1% as follows: SystemSpecs (takes 50% of the 1%), the banks (take 40%) and the CBN (takes 10%).
The letter which is signed by John Obara, MD of Systemspecs, was first published by The Nation. It makes a case for REMITA claiming that it reduces “shortages” the government suffers during collections and claims that banks charge between 2% to 26%, whereas it charges 1%. The company said it was willing to “negotiate” with the federal government on it contract.
The scandal began when Senator Dino Melaye revealed on the floor of the Senate that REMITA was being paid N25 billion in one month and called for an investigation into the relationship between the government and REMITA. Another Senator also claimed that REMITA has received N60 Billion in two and a half months.
Last week, it was reported that CBN had recovered N8.9 billion from Systemspec and had suspended the contract on the use of REMITA for the TSA collections.
The letter reads: “Your Excellency, we are aware that you must have heard series of reports around the 1% processing fees chargeable on e-Collections of Government receipts. We will like to provide some background on these issues sir.
“System Specs was engaged to provide the Payment Gateway for TSA in 2011. While the payment leg of TSA commenced in January 2012, the collection component did not start as scheduled due to the resistance from a number of quarters and the absence of the political will to push this through.
“In 2013, CBN and OAGF setup a multi-stakeholder implementation committee and organised a joint seminar with key stakeholders, including banks, to agree formalities for commencement of e-collection.
“The implementation committee however recommended 2.5% after negotiation with the banks.
“The then AGF later approved 1% as processing fee, which was in turn communicated to all the stakeholders through CBN in December 2013. Subsequently, we executed a contract with CBN and other stakeholders involved on the provision of services to support TSA.
“Based on the increased scope of the TSA project, following your directive in August 2015 for all MDAs to join the scheme, we had highlighted the need for a stakeholder meeting to discuss the TSA e-collection fees. This was communicated to both CBN and OAGF.
“Instead of an invitation for a stakeholders meeting as requested, we received a directive from the CBN Governor to refund all TSA e-collection fees earned to date and to suspend all charges on the platform.
“System Specs has since complied fully with this directive and refunded all monies earned to date to CBN. This we did in good faith and without prejudice to avoid distractions that could becloud the bigger potential of the TSA project for our country.
“While we await clarification from OAGF/CBN on the way forward, we have since suspended all TSA e collection fees on the platform. This means that none of the TSA collection parties/channels are earning any fees for providing services to Government.
“This position is however not sustainable as the collection partner banks are threatening to suspend FGN TSA collections. This would clearly be playing into the hands of those who do not wish this initiative to succeed.
“We understand the strategic importance of the TSA project to this administration and the country at large. We have demonstrated good faith and continued commitment to the project in the last four years to deliver on our mandate.
“We will continue to do all within our power to bring the project to full term.
“Your Excellency, we would appreciate your kind and urgent intervention to ensure a speedy resolution of this matter before the banks stop collections.”