Economic Confidential, May, 2009

FEATURES

Towards Reforming and Modernising the Nigeria Customs Service

By Dr. Mansur Muhtar

Without a doubt, the operations of the Nigeria Customs Service (NCS) have been less than optimal and have been source of serous concern to the Federal Government over the years to the extent that several reform efforts were initiated by Government to address their inadequacies. Against the backdrop of falling crude oil prices in the international markets, President Umaru Musa Yar’Adua directed that we harness all Government revenue sources expeditiously, especially those accruing from non-oil sectors, an aspect in which the NCS plays a prominent role.

The revenue generated by the NCS substantially contributes to funding the national budget each year. In spite of its significance however, the experience of this country is that Customs operation, as well as the process and cost of goods clearance are far from being effective or efficient. To maintain a posture of “business as usual” will therefore not only sustain the inefficiencies, leakages, fraud and corruption inherent in Nigeria’s trade practices and Customs operations, it will threaten the ability of the NCS to achieve the target set for it in the revenue profile Government laid before you late last year as part of the National budgeting system.

If this happens, it will bear grave consequences for the national economy. It will force further prioritization of Government’s expenditure and public spending with repercussions on national growth and economic development. The executive therefore commends your partnership in dealing with this issue and commits to working with the legislature in building an effective and efficient, modern Customs Service for Nigeria only fitting for a country aspiring to join the top 20 nations of the world by the year 2020.

It is documented that during the last decade, the Federal Government made several attempts at understanding and addressing the issues concerning trade controls and trade facilitation in Nigeria. It established many short-tenured, ad hoc Committees on Ports and Customs operation, all of which lacked sufficient latitude for implementing their recommendations. As a result, Nigeria lost the benefits of the efforts. In the few instances where some of the recommendations of some of the Committees were implemented, short reprieves were experienced that later fizzled out due to lack of adequate follow-up. Government’s experience with the latest reform of the Nigeria Customs Service proves that the NCS, in its current form, is incapable of reforming itself.

Concerned by the lack of progress in reforming the NCS over the last two years in spite of the strong interest showed by his administration, His Excellency, President Musa Yar‘Adua approved the appointment of three ex-officers of the Nigeria Customs Service (two of them former Comptrollers-General, the other a retired Comptroller) as members of a Presidential Task Force on Nigeria Customs Service Reform. These are people with sufficient knowledge of Customs operation, of immense integrity who served with diligence and left behind indelible track record of performance. They are to serve as external change agents for the reform of the NCS with the full involvement and participation of the officers and men of the Customs Service. I am happy to announce that I inaugurated this Task Force on the 16th of April 2009.

The Task Force is given the mandate to appoint Technical Committees and Work Groups to complement the skills and experience of its members, as it deems necessary, in the performance of its functions. The Task Force was granted a tenor of two years to carryout its assignment effectively and comprehensively and to enable the crystallization of major reorganization and transformation of the NCS into a modern institution capable of enhancing revenue generation, facilitating trade, and curbing smuggling, all of which are critical to Nigeria’s vision 20:2020 and the implementation of its 7-point agenda.

In exercising its functions, the Task Force draws its authority, including delegated oversight functions it deems appropriate, from the NCSB as provided for by Section 6 (1)(c) of the Customs, Immigration and Prisons Service Board Act of 1986, which mandates NCSB to delegate its powers to any Committee it prescribes. 

The objectives of the Customs reform and modernization is aimed at achieving the following, among others: establishment of new institutional framework operating with good governance and integrity; enhancement of operational effectiveness and efficiency attained through reform and modernization of Customs policies, processes and procedures; transformation of NCS’s human resource base to entrench sustained modernization and reform through regular reviews, training, capacity building and evidential performance management; institutionalization of trade facilitation through import liberalization and export growth; enhancement of revenue collection; improvement in the collation and dissemination of foreign trade statistics; reduction in risks and costs of transitional fraud and corruption; facilitation of WTO accession; and improvement in business environment and Nigeria’s competitiveness in world trade.

Within the context of the foregoing, the Presidential Task Force is required to execute the following terms of reference: to oversee, on behalf of the Nigeria Customs Service Board (NCSB), the implementation of an agreed Action Plan for the structural transformation of the NCS into an efficient, world-class organization, involving an overhaul of governance, organizational and leadership structures, systems, processes and procedures; to make appropriate recommendations to the NCSB in relation to leadership selection, capacity building, recruitment, promotion, discipline, retirement, as well as dismissal of officers and men of the service, in line with the Customs and Excise Management Act; to assist in overseeing the implementation of reform aimed at improving operational efficiency and effectiveness, focused on key aspects of Customs operations; drawing on international best practices;

in the context of above, and in liaison with relevant government agencies, to pay particular attention to the implementation of reforms aimed at speedy achievement of 48-hour cargo clearance in Nigerian ports; and  to carry out other duties as may be assigned to it by the President, Commander-in-Chief, and/or the Minister of Finance.

Dr. Mansur Muhtar, Finance Minister delivered this at the Opening of the Public Hearing on the Nigeria Customs Service Organized by the House of Representatives