The Senate resolved on Tuesday to investigate the procurement and expenditure of N30 trillion in Ways and Means loans from the Central Bank of Nigeria during the administration of former President Muhammadu Buhari.
Through the Ways and Means loan facility, the CBN finances deficiencies in the government’s budget.
Senator Emefiele’s irresponsible use of the overdraft obtained from the CBN was largely responsible, according to the senate, for the current food and security crises in the country.
The red chamber subsequently decided to establish an ad hoc committee to examine the expenditures of the N30tn overdraft incurred by the previous administration. It was noted that the National Assembly was not provided with specific information regarding the overdraft.
In addition to other intervention programmes, the ad hoc committee that will be established on Wednesday (today) will investigate the N10 trillion spent on the Anchor Borrowers Scheme and the $2.4 billion foreign exchange transaction out of the $7 billion obligation made for that purpose.
As Nigerians continue to be battered by a severe food crisis, escalating inflation, a depreciating naira, and deteriorating insecurity, this development emerged.
Following the adverse economic conditions that arose as a result of his fuel subsidy removal and exchange unification policy implemented last year, President Bola Tinubu and his economic team have faced significant censure.
The cabinet members of Tinubu have maintained their position that the current crises were further intensified due to the severe mismanagement of the Buhari regime. They contend that the present reforms were implemented to rectify the errors of the previous administration.
The Senate’s most recent action is anticipated to expose the purported mismanagement of the nation and its resources during the Buhari administration.
In January 2023, Buhari requested in a letter to the National Assembly that the N22.7trn Ways and Means loan be converted to a 40-year bond featuring a three-year moratorium.
Furthermore, he sought authorization to borrow an extra N1 trillion in order to finance the N819.5 billion supplemental budget for 2022, which was approved by the legislature in December.
In response to the request, the House of Representatives approved the conversion of the N23.7trn loan to a long-term bond with an annual interest rate of nine percent for forty years on May 4, 2023.
There is a three-year moratorium on the bond.
The report put forth by the House Committees on Finance, Banking, and Currency and Aids, Loans, and Debt Management was granted approval for consideration by the lower chamber.
Under the leadership of the then-Deputy Speaker Idris Wase, the Committee of Supply deliberated on and approved the report’s recommendation.
However, the 9th Senate descended into anarchy when certain senators opposed Buhari’s request for approval of the CBN loan on the grounds that it lacked sufficient information.
Adeola Olamilekan, chairman of the Senate Committee on Finance, was about to deliver the report pertaining to the president’s request when Betty Apiafi, a senator from Rivers, raised a Point of Order arguing that the request violated the Constitution.
However, she was deemed improper by Ahmad Lawan, the then-president of the Senate, who requested that Olamilekan present the report prior to any contributions being made.
By invoking pertinent legislation from the Constitution, the CBN Act, and the Senate Standing Rules, Senator George Sekibo of Rivers contended that the request violated constitutional principles.
‘’It will be a disservice that we have spent that money on behalf of Nigerians. It will be an abuse of our personal sense and against our privileges if we approve this request without details of the expenditure,’’ he insisted.
Many lawmakers who opposed the president’s request either said it was against the laws or wondered why the National Assembly was not notified when the amount was taken from the Central Bank.
Senate’s fresh inquiry
Nevertheless, the Senate passed its resolutions on Tuesday subsequent to its deliberation on the Joint Committee on Banking, Insurance and Other Financial Institutions, Finance, National Planning, Agriculture and Appropriations’ State of the Economy report. This occurred subsequent to interactive sessions that were conducted with the economic management team of the Federal Government.
However, the examination of the report in plenary was acrimonious, as senators levelled accusations and counter-accusations regarding the manner in which the 9th Senate approved the N22.7tn Ways and Means in May 2023.
The legislators were additionally displeased with the 10th Senate’s approval of N7.2tn on December 30, 2023.
In his contribution, Senate Whip Ali Ndume (APC Borno South) specifically criticised the Senate for granting approval to the request without obtaining any additional information from former President Buhari.
Ndume stated, “When the N22.7trn Ways and Means approval request was presented to the 9th Senate, I insisted that expenditure details be provided prior to approval; however, the Senate ultimately granted approval.”
In contrast, Jibrin Barau, the Deputy Senate President, argued that the decision reached at that time was a consensus among all members of the Senate, with the stipulation that the executive branch would furnish further information, which was not provided.
Former Senate President Lawan, in his defence, asserted that the Ways and Means Committee belonged to the past and exhorted the Senate to concentrate on the present.
Lawan said, “All of that is in the past, we must focus on the present which is the fact that people are hungry and they are crying. That’s what we should focus on.”
The Senate President, Godswill Akpabio, said as recommended by the committee and supported by most of the Senators, a thorough probe must be carried out on the N22.7tn Ways and Means approved in May 2023 by the 9th Senate which later increased to N30trn, with the passage of the N7.2trn accrued interest forwarded to the senate for passage last December.
Akpabio said, “The food and security crises confronting the nation now are traceable to the way and manner the said Ways and Means were given collected and spent. Details of such spending must be submitted for required scrutiny and possible remedies because what Nigerians want is food on their table which must be given.”
He added, “Other recommendations made by the committee on the need for a thorough investigation of the N10trillion Anchor borrowers programme, and other intervention programmes running into billions of dollars must be investigated.
“But as rightly recommended by the joint committee, security agencies should, as a matter of national urgency, combat all forms of insecurity across the country for farmers to access their farms for required food production highly needed in the country now.”
According to the executive summary of the report by the Senate’s joint committee, a copy of which was obtained by one of our correspondents on Tuesday, the Nigerian economy is currently facing challenging times “largely caused by distortions resulting from major fiscal and monetary policy actions of previous governments notably the huge direct lending to the Federal Government by the Central Bank of Nigeria to the tune of about N30 trillion, the operation of an opaque fuel subsidy regime and a raft of interventions by the Central Bank which seemed not well targeted.”
The report stated that this had led rising inflation especially food, and persistent naira depreciation.
The Joint Senate Committee on Banking, Insurance and Other Financial Institutions, Finance, National Planning, Agriculture and Appropriations convened an interactive session with the principal members of the Federal Government’s economic management team in response to the prevailing economic challenges encountered by the Nigerian people.
The objective was to determine the actual condition of the nation’s economy, the characteristics of the obstacles encountered, and the strategies being implemented to resolve them expeditiously.
As stated in the report, the interaction has underscored the critical nature of coordinating fiscal and monetary policies in order to stabilise the economy, reduce inflation, and increase food production.
The report further read, “The current state of the country’s economy is very challenging and has resulted in widespread suffering for the average Nigerian across the country. At the forefront of Nigeria’s economic challenges is the alarming surge in inflation rates, with headline inflation soaring to a staggering 28.92 per cent as of December 2023. This inflationary pressure is more evident in the essential sector of food, with food inflation now as high as 33.93 per cent leading to cost-of-living crisis and rendering basic necessities increasingly unaffordable for many Nigerians. The inflationary spiral not only erodes the purchasing power of households but also exacerbates poverty and inequality across the nation.
“One of the main drivers of inflation in Nigeria today is the volume of money in circulation. As at December 2023, the country recorded an unprecedented money supply of N78.74tn, and a 51 per cent year-on-year increase when compared to money supply as at December 2022. One of the driving forces of this significant increase in money supply was the N30tn Ways and Means or the direct financing extended by the CBN to the Federal Government which has only weakened the balance sheet of the central bank. In addition to the inflationary pressures, the country is also battling with acute shortages of food items.”
The report noted that the naira has continued to weaken against the dollar overtime, adding that “In January 2024, the naira depreciated against the dollar by 37.6 per cent which has contributed to the inflationary pressures in the country, increased the cost of goods and services and also led to increased foreign exchange speculation.”
The Senate probe panel is expected to begin to summon some key members of the previous administration’s cabinet members.
PDP approves of the investigation
The People’s Democratic Party has urged the National Assembly to investigate Buhari’s administration in accordance with the proposed investigation.
Ibrahim Abdullahi, the PDP’s Deputy National Publicity Secretary, attributed the present obstacles that Nigerians are experiencing to “the actions and inactions” of former President Buhari.
Abdullahi stated, “You know, that’s what we have always clamoured for. If there is any modicum of integrity in this government, then Buhari needs to be probed. It is not just about probing his government; Buhari himself should be probed. I am sure he does not enjoy any immunity now.
“This cannot continue in Nigeria.” Fifty years after independence, we are still stuck in the same place. Any Tom, Dick, and Harry will take over leadership for years, and after inflicting untoward hardship on the citizenry like Buhari did in his eight years, then the individual will go free, and nothing will happen.
“The PDP is supportive of the Senate’s proposed probe of Buhari’s government, despite our lack of belief in it. However, it signifies a development aimed at restoring the faith of Nigerians in the system. Buhari should be subjected to a tribunal or panel to account for everything he did during the last eight years.
“Already, Buhari’s actions have been a form of self-investigation. We’ve been witnessing revelations, and some of us have been vocal about it even during his tenure. He was steering Nigeria backward due to a lack of ideas and offered nothing to Nigerians, yet some forces imposed him on us. We endured a harrowing experience during his eight years in office.
“They claimed he had Nigeria’s best interests at heart. How? The Senate should investigate him, and we support them wholeheartedly, hoping it won’t be another futile arrangement as we’ve seen in the past. Let them match words with action.
“Nigerians are receiving it the hard way now. Everybody is surviving miraculously, insecurity has taken a toll on this country. What we are going through these days, the upheavals in the country and the hardships are the fallout of what Buhari has done with this country within eight years.”
LP speaks
Also, the Labour Party described the Senate’s plan to probe Buhari’s administration as a welcome development, doubting however whether the Senate would follow through.
LP’s National Publicity Secretary, Obiora Ifoh, expressed this view in an interview with one of our correspondents on Tuesday, likening the Senate to an appendage of Tinubu’s All Progressives Congress-led Federal Government.
He stated “If they actually want to walk the talk, then it is a welcome development. But also know that Nigerians do not have trust in this present Senate, because they are like an apron to President Bola Tinubu’s government. They have virtually approved any request by Tinubu’s government. So they don’t trust them
“The question is, do they have the political will to investigate APC? This government is a continuation of Buhari’s government and the APC is known for condoning corruption. Therefore, it is improbable that they will execute that threat. Because they congregate in groups, it is evident that they are birds of the same feather.
“So in summary the Labour Party thinks it is a good thing, but whether they will carry out that probe, is something else. Because the current Senate leadership does not have the political Will to investigate anybody, not to talk of the past government.”
Meanwhile, attempts to get comments from the former Minister of Information and Culture, Mr Lai Mohammed, were unsuccessful even as the counsel to Mr Emefiele, Mr Matthew Bukka, did not take calls to his mobile line at press time.