Introducing a Treasury Single Account in Nigeria

Posted by Kabiru Dandago[1]

A recently published book[2] reviews the introduction of the Treasury Single Account (TSA) by the federal Government of Nigeria, a reform of major economic significance. An earlier PFM blog published in 2014 also described the development of the project.

A TSA is simply a means of aggregating cash resources for effective and efficient budget execution. As a central bank account or a set of linked accounts, a TSA ensures compliance with the principle of unity of cash management and the unity of treasury operations. It emphasizes the need for all revenues to be fully collected and accounted to support service delivery, while spending efficiency by ministries and agencies is encouraged and institutionalized.

The book starts by outlining the concepts, methodology and theoretical underpinnings of the TSA. These underpinnings included Principal-Agent Theory or Agency Theory and Transaction Cost Theory. The study carried out by the author uses qualitative and quantitative techniques to analyse the impact of the TSA on the operations of government ministries and agencies. The book then discusses the key design features of the Nigerian TSA – its scope and structure, the arguments for locating the TSA in the central bank, and how implementation of the reform was carefully sequenced (critical to its wide acceptance across government agencies). Nigeria was not the only or the first country to adopt a TSA. Other examples from emerging market economics include  Brazil, Indonesia and Uganda. The book provides examples from more than 20 other countries that are operating one variant of a TSA or another.

A later chapter presents the historical development of the TSA,  discusses the policy framework, the implementation strategies adopted by the government, and the arrangements for monitoring and evaluating its implementation by ministries and agencies. The changes to Nigerian law that were required are also discussed.

The study then analyses empirical data on the implementation of TSA in key ministries, and responses to surveys carried out among different socio-demographic groups. It assesses the effectiveness of the institutional mechanisms put in place to implement the TSA, the use of the GIFMIS and REMITA platforms, the legal and regulatory framework for TSA operations, the reliability of the ICT infrastructure, the level of coordination among the institutions implementing the TSA and their capacity, the efficiency of the monitoring and evaluation mechanisms, among many other important issues.

The book summarises the main findings of the empirical study: the current state of the implementation of the TSA policy by ministries and agencies, and the TSA’s impact on ministries’ operations. Among its recommendations are that the federal government should broaden the base of reforms by enacting a Public Financial Management Act, and that the monitoring and evaluation mechanisms be strengthened to make them watertight.

The book suffers from some shortcomings. For example, it is silent about the need to trickle down the TSA policy to the state and local government level, as well as including autonomous government agencies such as universities within its scope. Overall, however, the book provides an excellent guide for accounting and finance students as well as academics, donors and practitioners on an important PFM reform that was complex but generally well executed, and that provides useful lessons for other countries contemplating similar initiatives.


[1] Professor of Accounting, Bayero University, Kano-Nigeria.

[2] Treasury Single Account Policy in Nigeria written by Salawu Adeku Zubairu

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