Senate to probe N30trn Ways and Means secured under President Buhari

The CBN is expected to use the Ways and Means, a kind of loan facility, for financing the federal government’s budget shortfalls.

The Senate has resolved to probe how former President Muhammadu Buhari‘s government got and used the N30 trillion Ways and Means loans from the Central Bank of Nigeria (CBN).

This is in response to its recommendation that the federal government give priority to liquidating its N30 trillion Ways and Means liability over 40 years via a quicker resolution mechanism than the current securitization structure.

According to the Senate, the country’s current food and security challenges are mostly the result of Godwin Emefiele’s careless use of the overdraft that had been acquired by the CBN and it decided to set up an ad hoc committee to look into what the previous government did with the N30 trillion overdraft, pointing out that the National Assembly had not been given access to the details of the spending.

In addition, the N10 trillion spent on the Anchor Borrowers Scheme, the $2.4 billion FX transaction out of the $7 billion obligation made for that reason, and other intervention initiatives would be examined by the ad hoc committee that will be constituted on Wednesday, 21 February 2024.

The Senate’s decisions on Tuesday, however, came after it had considered the report of its Joint Committee on Banking, Insurance and Other Financial Institutions, Finance, National Planning, Agriculture, and Appropriation, which is chaired by Senator Abdullahi Yahaya Abubakar (PDP, Kebbi North).

Presenting the report, Abdullahi, called for proactive measures to be taken due to the fall of the naira.

He said, “The persistent inflationary trend and the fall of the naira underscore the urgency for proactive measures. The findings from the session illuminate the multifaceted factors contributing to these challenges.

“As this report indicates, a collaborative effort between the executive and the legislature, and between the fiscal and monetary authorities is imperative to mitigate the risks associated with a potential hyperinflate and the crash of the naira.”

However, the discussion of the report in plenary became chaotic, with senators trading words and denials regarding the process by which the 9th Senate approved the N22.7tn Ways and Means in May 2023. The 10th Senate’s adoption of N7.2tn on December 30, 2023, also infuriated the lawmakers.

The Senate Whip Senator Ali Ndume (APC Borno South) accused the Senate of granting the request without seeking clarification from former President Buhari.

READ ALSO: Senators trade words over N29 trillion Ways and Means funds

The Senate decided to look into the 30 trillion CBN loan because of the deepening food crisis, growing rates of inflation, depreciation of the currency, and growing levels of insecurity that continue to affect Nigerians.

Following the imposition of severe economic conditions on the populace last year due to his elimination of fuel subsidies and exchange unification policies, President Bola Tinubu and his economic team have been heavily criticised.

The latest move by the Senate is expected to unravel the ways the country and its resources were allegedly mismanaged by the Buhari administration.

OrderPaper recalls that Buhari had in a letter to the National Assembly in January 2023 requested that the N22.7trn Ways and Means loan should be converted to a 40-year bond with a moratorium of three years.

He also requested approval to borrow an additional N1trn to fund the N819.5 billion 2022 supplementary budget which the lawmakers approved last December.

Following the request, the House of Representatives on May 4, 2023, approved the conversion of the N23.7trn loan to a long-term bond for 40 years at the rate of nine percent per annum.

However, some senators objected to Buhari’s request for the CBN loan approval and demanded to see the details of his proposal, which led to a chaotic session of the 9th Senate.

Additionally, Senator Betty Apiafi (PDP, Rivers) raised a Point of Order, claiming that the president’s request was unconstitutional, when Senator Solomon Olamilekan, the chairman of the Senate Committee on Finance at the time, attempted to present the report of the president’s request. But, Ahmad Lawan (APC, Yobe North), who was the Senate President of the 9th Senate, ruled her out of order and requested that Olamilekan deliver the report before any contributions.

Meanwhile during the debate of this report yesterday, 20 February 2024 Ndume said, “When the N22.7trn Ways and Means approval request was brought before the 9th Senate, I insisted that details of spending made with it should be provided before approval but the Senate then went ahead and approved it.”

In his contributions, the Deputy Senate President, Jibrin Barau who was the Chairman of the Appropriation Committee in the 9th Senate, retorted that the decision made at the time was a collective decision with the understanding that the executive would provide more information later on, which was never given.

“I think there is a need to clarify here. Ways and Means is supposed to be a temporary overdraft that is extended from the CBN to the Executive arm of government. It could be due to an emergency. It is expected that if the Executive arm of government and the legislature are on the same page, especially when the government has the majority in the Senate or the National Assembly, it is expected that we always collaborate and assist the Executive arm of government in an emergency and when those requests were brought here, we knew they were certain situations of emergency.

“We said we were going to pass it because of certain situations that were urgent, but we asked that they provide their details later and it was a collective effort by the Senate and that was done.

“That does not exclude the fact that we can still go and investigate what we passed, we are open to investigations. Anytime the Senate feels that we should go and investigate that, we go and investigate, but what happened before now was a collective responsibility and it was done in the interest of the nation.”

The former Senate President, Ahmad Lawan, defended himself by saying that the Ways and Means Committee was out of date and urged the Senate to concentrate on the issues at hand.

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.”

Further speaking he said, “If we have a ways and means that is 30trn  today, that means something happened but let me say this very clearly. What Nigrrians need today is food and security. This belongs to the medium-term or long-term action that we need to take for Nigerians and protect their lives.

“Let’s not put the cat before the horse, let us consider it necessary to look at what happened in the past but we are in the present and the present is so unpleasant and we have to act very very swiftly.”

The Senate President, Godswill Akpabio, declared that a comprehensive investigation into the N22.7tn Ways and Means, approved in May 2023 by the 9th Senate and later increased to N30trn, along with the passage of the N7.2trn accrued interest forwarded to the senate for passage last December, was necessary, as advised by the committee and backed by the majority of Senators.

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.”

Akpabio revealed that he was conversant of the fact that a day will come when people will be called to explain the Ways and Means because government is a continuum as the Senate has the right to probe.

He also said that what was done in the 9th Senate  has put the Nation in a “serious mess.” He demanded information be given, stressing that the 10th Senate would not act as a rubber stamp.

Akpabio  said, “We are where we are today as a result of illegal things and I think it is necessary that details of Ways and Means be provided.”