US embassy cable - 03ABUJA257

UNCLAS SECTION 01 OF 03 ABUJA 000257 
 
SIPDIS 
 
 
E.O. 12958: N/A 
TAGS: PGOV, ECON, NI 
SUBJECT: NIGERIA: AUDITOR GENERAL REPORT HITS THE MEDIA; 
IMPACT ON CORRUPTION LESS CLEAR 
 
REF: 2002 ABUJA 1606 
 
 
1. (SBU)  Summary.  The Auditor General of the Federation 
(AGF), akin to an Inspector General in the USG, has recently 
released the Audit Report for Calendar Year 2001 (Part One). 
Citing malfeasance in all tiers of government, the report has 
gained notoriety in the media and spawned calls from the 
President and civil society for greater transparency in 
government. The report itself is an undigested listing of 
irregularities found by the AGF's 700 professional auditors 
including such examples as: 
- a) $45,000 in unaccounted funds budgeted by the Federal 
Capital Territory to buy gifts for a canceled State visit by 
Libyan leader Muammar Qadaffi; and 
-  b) U.S. $20,000 given to Ministry of Police Affairs 
police officials without proper authorization or accounting. 
Misappropriations and financial irregularities identified by 
the Auditor were not followed up in the past for various 
reasons, chiefly lack of political will.  Acting Auditor 
General of the Federation Azie believes this report,s fate 
will be different. However, there will certainly be 
resistance to the report's recommendations and many in 
government are not pleased by the release of the report 
before elections. Already, Information Minister Jerry Gana 
publicly dismissed the audit as "rash" and calculated to 
embarrass the GON. End Summary. 
 
 
Background 
---------- 
 
 
2. (U)  On January 13, newspapers reported that the Auditor 
General had forwarded to the National Assembly his report 
covering government accounts for calendar year 2001.  The 
audit reportedly charged the executive, legislature, and the 
judiciary with numerous fiscal and procedural improprieties. 
 
 
3. (SBU) Meeting with EconOff on January 21, Acting Auditor 
General V.S.C. Azie said the report was provided to the 
National Assembly pursuant to the constitution.  He was 
unsure whether he was authorized to release the report to the 
public or to foreign diplomats. Refusing to provide a copy, 
Azie however allowed EconOff to view a copy of the report 
when asked, and promised to make it available as soon as the 
"media heat" cooled off. 
 
 
4. (U) To back up his claim that the Auditor General's office 
is committed to transparency, Azie showed EconOff mock-ups of 
the website he hopes to launch in February.  There, he 
explained, the report would be made available to the general 
public.  More than 270 pages long, the report contains no 
executive summary and cites individual irregularities by 
Ministry or agency. The report is a difficult read, the 
editing is poor and narrative consistency is lacking.  More 
importantly, there was little effort made to clearly define 
the elements of each offence reported. 
 
 
5. (U) The Acting Auditor General explained that Part Two of 
the Report would contain more analysis and interpretation. 
However, completion of that section would require more 
information from the Accountant General of the Federation. 
He speculated this might take two or three years.  Rather 
than wait for the second part, as had been the custom, he 
believed it would be better to publish the raw information as 
soon as possible.  He forwarded that section of the report to 
the National Assembly in hopes that his action would lead to 
the public dissemination of the raw audit. 
 
 
 
 
6.  (U) Azie acknowledged his office has no prosecutorial 
powers and only makes recommendations to the National 
Assembly Public Accounts Committee (PAC), which has to pursue 
the individual cases.  When asked if this would be effective 
given the erratic performance of the National Assembly, Azie 
was upbeat.  He claimed some cases were pursued by the House 
PAC from the 1997 Audit (the last available) and that the 
legislators had identified agencies and individuals who 
indeed made restitution. 
 
 
7.  (U) With fresh information from the 2001 audit, Azie 
believes the House PAC could resolve many cases.  He 
explained that many times individuals and Ministries refused 
to even answer queries from the auditors.  The PAC had the 
power to subpoena individuals and, if necessary, refer them 
for criminal prosecution, though this step has never been 
taken.  In contrast to the House, the Senate Public Accounts 
Committee was moribund and had not taken any action, Azie 
noted. 
 
 
8. (U)  Azie's best case scenario saw his office coordinating 
with the Independent Corrupt Practices and other Related 
Offences Commission (ICPC), and the Budget Price Monitoring 
and Investigation Unit (BMPI) in the President,s office 
(reftel), to reduce corruption by making the contract 
tendering processes for capital projects more transparent. 
This could not happen overnight, but with continued increases 
in resources and support from the top, it would eventually 
make a difference and begin to change behavior in government. 
 
 
 
 
 
 
Constraints on the Auditor's Office 
----------------------------------- 
 
 
9.  (U) Azie decried the lack of protection for auditors and 
whistleblowers who vigorously pursue corruption.  While 
auditors work for him, their offices are often located in the 
Ministries and agencies they investigate.  An aggressive 
auditor could wind up in a "living hell" if he upsets too 
many people, and there is little the Auditor General's Office 
can do to protect or even transfer them to other government 
institutions. 
 
 
10. (U) Azie also complained that his office is underfunded, 
making it difficult to carry out some of its functions. 
Though there is a new training program  from the World Bank, 
Azie noted the Auditor General's office had received very 
little training in the last 15 years despite the GON policy 
of setting aside ten percent of the annual personnel costs 
for training.  However, Azie advises his staff to personally 
train themselves, including extension and on-line courses, 
since the government is not ready to make funds available. 
 
 
 
 
FEDERAL EXECUTIVE COUNCIL MEETING 
--------------------------------- 
 
 
11. (U) Perhaps in response to extensive and sensational 
press coverage of the report, the audit was discussed at the 
weekly Federal Executive Council (FEC) meeting of January 29. 
President Obasanjo directed all Ministries to immediately 
respond to the Public Accounts Committee of the National 
Assembly with explanations of the anomalies identified in the 
document. 
 
 
12. (U)  However, the Executive seemed to be of two minds 
regarding the report. That same afternoon, Information 
Minister Gana briefed the media that the report was intended 
to embarrass the Federal Government.  He dismissed the report 
as an unprofessional audit that levied charges without regard 
for due process and accuracy. 
 
 
13. (U) Gana further claimed that the Auditor General did not 
give the Ministries the opportunity to provide detailed 
explanations before the report was submitted to the National 
Assembly.  He challenged Azie's professional competence 
saying "it would appear that the Auditor General was in some 
kind of haste to rush out the report because there are three 
phases which he never followed." 
 
 
 
 
Comment 
------- 
 
 
14. (SBU) Comment: While the recent report generated much 
discussion among the general public, Azie's quest to make a 
positive impact from his revelations will be an uphill 
struggle. Things are rarely straightforward in Nigeria and 
this maxim applies doubly to the topics of corruption and 
malfeasance during an election year.  No doubt, many National 
Assembly Members probably were happy to receive the report, 
it was the glee of a wrongdoer who has caught his accuser in 
a similar transgression.  National Assembly members believe 
the Presidency has used the ICPC to target the Assembly 
leadership and other members the Presidency opposes; now, 
they probably are looking at Azie's report as an instrument 
to blunt the President,s actions against them. Because the 
report provides information about executive branch 
corruption, the Assembly will likely use it to deter vigorous 
pursuit of House members. 
 
 
 
 
15.  (SBU) Instead of advancing the battle against 
corruption, the most likely short-term effect of the report 
will be relative inaction based on a sort of executive and 
legislative branch mutually assured political embarrassment 
through public disclosure of corrupt practices. 
 
 
16. (SBU) There is also the possibility that the President 
may signal to the House PAC that some of his Ministers are 
more expendable than others. This way he could use the report 
to provide the political cover to rid himself of deadwood 
Ministers.  If some of his Ministers were allowed to walk the 
plank, this could actually enhance Obasanjo,s reputation for 
fighting corruption.  Moreover, albeit done for less than 
noble reasons, this would still constitute genuine progress 
in the fight against corruption. End Comment. 
JETER