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New Telegraph

2022: 11 MDAs to spend N3.4bn on software

Five years after stakeholders in the information and communication technology industry condemned increasing capital flight, especially with regard to importation of software by Federal Government’s agencies and parastatals, indications have emerged that the trend is yet to wane as revealed from the 2022 budget. While the stakeholders had moved to domesticate acquisition of software by seeking to incorporate a regime of local content compliance to curb capital flight, not much has been heard in this regard on the part of the Federal Government as the ministries, departments and agencies have already budgeted over N3 billion for software acquisition next year.

At a conference in Lagos in 2016, the stakeholders had said there was the need to review the existing local content policy in ICT drafted in 2013, with a view to finetuning it for presentation at the National Assembly and speedy passage into law. In aligning with this, the Federal Government had earlier this year come up with a new local content policy for the ICT industry.

Poor implementation of the new policy is, however, giving room to the sustained importation of computer software, thereby truncating the growth of local operators. The stakeholders expressed concern that Nigerians were losing jobs and contracts to foreigners due to individual and public sector appetite for foreign software. Describing the situation as depletion of the nation’s economy, they blamed lack of the Local Content Development Law for ICT, saying that a law with proper implementation should be put in place to protect the interests of Nigerians and Nigerianowned businesses. Findings by New Telegraph from the 2022 Appropriation revealed that the MDAs have not been specific as to where they are sourcing theirsoftware, therebygiving credence to the fact that the country might lose more funds to foreign operators in this regard.

The State House under the Presidency and 10 Ministries, Departments, and Agencies (MDAs) of the Federal Government will next year spend the sum of N3.4 billion on computer software, New Telegraph has learnt. Provisions for the acquisition have been made by the respective MDAs in the 2022 Appropriation Bill, which has just been passed by the National Assembly.

This is coming amidst serious concerns by Nigeria’s ICT stakeholders that billions of naira were being wasted on an annual basis by MDAs on the acquisition of foreign software. Although the budget analysis did not reveal the type of software being budgeted for and whether it is local or foreign, most ministries currently rely and operate on foreign software even while the same can be sourced locally, according to the Institute of Software Practitioners of Nigeria (ISPON). The provisions, which came under the ‘acquisition of non-tangible asset’ line item showed that the Ministry of Works and Housing would spend the largest amount on software in 2022 as it budgeted N1.2 billion for the asset.

This was followed by the Ministry of Finance, Budget, and National Planning, which is to spend N684.5 million on software acquisition next year. According to the budget proposal, the State House under the Presidency is to acquire computer software with the sum of N470.8 million, while the Office of the Secretary to the Government of the Federation (OSGF) is to spend N251.2 million on the item. Further analysis of the budget document showed that the Ministry of Labour and Employment is to spend N299.8 million on the acquisition, while the Ministry of Defence is to spend N164.6 million on the acquisition of the asset. According to the budget document, the Ministry of Information and Culture plans to spend N172.5 million on software, while the Ministry of Police Affairs is to spend N147.8million on non-tangible assets. The Ministry of Communications and Digital Economy is to acquire computer software worth N43.805 million as the Ministry of Water Resources plans to spend N29 million on the same item in the coming year. The Ministry of Special Duties and Inter-governmental Affairs is to acquire software with N19.4 million, which came as the least compared to other Ministries’ budgets for the same item. The National Information Technology Development Agency (NITDA) had recently noted that billions of naira were being siphoned by MDAs through Information Technology (IT) projects because they are too technical to be scrutinised by the National Assembly during the budget defence. Based on this, the agency in 2018 introduced compulsory clearance from the agency before any IT project can be embarked upon by MDAs. Through the clearance, NITDA said the agency had saved the Federal Government over N13 billion in the last one year. The implementation of the new rule, the agency said, also ensures that IT projects and services that can be delivered by Nigerian companies are not sourced from abroad. However, a former President of Institute of Software Practitioners of Nigeria (ISPON), Mr. James Emadoye, noted that despite the efforts of NITDA, the MDAs are still finding loopholes to siphon funds through software acquisition. “Nigerians are very deceiving people. Sometimes, when you read memos that are written to justify the acquisition of software, if you don’t have the benefit of hindsight, you may not even understand it. “A memo for the acquisition of software that many companies have in Nigeria will be written and described as special software for one engineering process to convince those who are monitoring them that they need to import it,” he said. Emadoye noted that NITDA and other agencies of government in charge of procurement needed to do more to stop the wastage.

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