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MR. PRESIDENT; WITHHOLD ASSENT TO THE AMENDMENT OF THE CENTRAL BANK OF NIGERIA ACT
MR. PRESIDENT; WITHHOLD ASSENT TO THE AMENDMENT OF THE CENTRAL BANK OF NIGERIA ACT
By: Michael Mike
Centre for Social Justices (CSJ) notes with regret the recent amendment to the Central Bank of Nigeria Act, increasing advances the CBN can grant to the Federal Government of Nigeria from 5 percent to 15 percent. The amendment contradicts best practices in fiscal responsibility and is an authorization of the Executive to create macroeconomic distortions through arbitrary and increased ways and means funding.
We recall that the extant S.38 of the CBN Act grants FGN access to ways and means financing in respect of temporary deficiency of budget revenue at such rate of interest as may be determined by CBN. The total amount of such advances outstanding shall not at any time exceed five per cent of the previous year’s actual revenue of FGN. All Advances made pursuant to this authority shall be repaid – (a) as soon as possible and shall in any event be repayable by the end of the Federal Government financial year in which they are granted and if such advances remain unpaid at the end of the year, the power of CBN to grant such further advances in any subsequent years shall not be exercisable, unless the outstanding advances have been repaid.
According to Senator Gobir said: “The very essence of this bill is to enable the federal government to meet its immediate and future obligation in the approval of the ways and means by the National Assembly and advances to the federal government by the Central Bank of Nigeria. This amendment is very consequential and it needs the support of us all. This is to enable the federal government to embark on very important projects that will inflate and rejig the economy.” However, the amendment is a misconceived route to meeting the needs and obligations of FGN and definitely cannot be the road to rejigging the economy. It will rather create new macroeconomic challenges.
Specifically, the following issues are noteworthy:
v If FGN has not been able to refund previous advances from the CBN at 5 percent of previous year’s revenue, what machinery did the amendment put in place to ensure that FGN will be in a position to repay 15 percent of previous years revenue by the end of its financial year?
v There is evidence that previous advances from the CBN were in excess of the 5 percent rule and instead of reforms to ensure conformity with fit and good practices, a leeway is provided for deepening fiscal mischief.
v Previous high levels of advances led the Executive to incur over N23trillion in ways and means which could not be repaid and had to be converted by the National Assembly to long term indebtedness contrary to the provisions of the CBN Act.
v S. 38 (1) of the CBN Act categorically states that such advance should be in respect to temporary deficiency of budget revenue and not as a means of funding the deficit budget as the Federal Government has resorted to in recent years. Over the years and in accordance with fit and good practices, ways and means has never been listed in the Appropriation Act as a source of funding the deficit.
v The option of resorting to ways and means to fund budgetary deficits further increases the already high inflation rate especially when done by printing money not backed by value. Thus, it erodes the value of the Naira, and real income; it reduces purchasing power of citizens.
v The amendment of the CBN Act did not follow due process; it was arbitrary and lacking in popular particpation. There was no opportunity of a public hearing and publicity, to give room for Nigerians to make inputs on this very crucial matter with potentials to negatively affect overall economic growth and general welfare of the people.
In the light of the foregoing, CSJ strongly appeals to President Bola Ahmed Tinubu to withhold assent to the bill. CSJ acknowledges the revenue challenges facing the nation but the implementation of this particular bill (if it becomes law) will create monumental macroeconomic challenges now and in the future.
Eze Onyekpere Sundayson Chidi
Lead Director Program Manager, Public Finance Management.
MR. PRESIDENT; WITHHOLD ASSENT TO THE AMENDMENT OF THE CENTRAL BANK OF NIGERIA ACT
Nine injured in farmers–herders clash in Nasarawa
By: Zagazola Makama
No fewer than nine persons were injured on Monday following a clash between farmers and herders in Loko community, Nasarawa State.
Zagazola report that the incident occurred at about noon on Dec. 15 in Bakono village, Loko area, after a dispute over alleged damage to farmland.
The source said the farmland involved belonged to one Bako Usman.
According to the source, the clash resulted in injuries to five farmers and four herders.
Security forces stormed the scene to restore order, while the injured persons were rushed to the General Hospital, Loko, where they were admitted and are responding to treatment.
Sources said that a stakeholders’ meeting had been convened in the community to prevent further escalation of the crisis.
According to the sources, confidence-building patrols are ongoing, the situation is being closely monitored and the area remains relatively calm.
Nine injured in farmers–herders clash in Nasarawa
Soldier killed as troops clash with suspected militia in Taraba
By: Zagazola Makama
A soldier has been killed, while two others are missing following an attack on troops escorting farmers in Takum Local Government Area of Taraba State.
Zagazola gathered that the incident occurred on Monday during a security operation in a bush area of Takum, which has been prone to clashes involving militia elements.
The source said soldiers from a special forces unit along with police, NSCDC were deployed to provide security for Tiv farmers harvesting their farm produce when they were attacked by hoodlums suspected to be local militia in Taraba state.
According to the source, one soldiers was killed during the attack.
The source further disclosed that following the incident, soldiers cordoned off the venue of the Miyetti Allah executives’ election at the FGR Samsokwa Hall, in Takum, and arrested male executives of the association present at the venue. Though it was yet to establish if they were involved in the attack.
Another sources pointed accusing finger at the Taraba state special adviser on security allegedly to be behind the Militia. Though, Zagazola cannot independently verify the claim.
Meanwhile, security forces have arrested a group of suspected armed bandits in Ifelodun Local Government Area of Kwara State. The suspects were caught with AK-47 rifles during an operation carried out on Friday.
After their arrest, the suspects were taken into custody. In a video that later surfaced online, the men were seen lying face down with their hands tied while security operatives questioned them about where they got the weapons.
One of the suspects alleged that some officials of the Kwara State government gave them both the vehicle and the rifles. He claimed they had been operating in the area under the cover of patrol duties.
According to him, the weapons did not belong to them personally. He said their leader collected the rifles and that they often went on patrol together with some individuals he mentioned by name. He insisted that the guns belonged to those officials.
Soldier killed as troops clash with suspected militia in Taraba
Gunmen abduct five workers at construction site in Kwara
By: Zagazola Makama
Gunmen suspected to be bandits have abducted five workers at a construction site along the Sabaja/Owa-Onire Road in Kwara State.
Zagazola report that the incident was reported at about 4:30 p.m. on Monday by Alhaji Suleiman Abdullah Olanrewaju, manager of Fix Contracting Engineering Company.
The source said Olanrewaju reported that the abduction occurred earlier in the day at about 11:40 a.m. while the workers were on site when the gunmen attacked and whisked them away.
Those abducted were identified as Engr. Ademola Afolabi, Engr. Umar Lade, Fatai and Akin, both labourers, as well as a driver identified as Yusuf.
According to the source, the complainant said he had earlier reported the incident to the military before notifying the police.
Upon receipt of the report, the Divisional Police Officer (DPO) in Oreke mobilised a team of police operatives who linked up with the military and local vigilantes to comb the surrounding bushes in a bid to rescue the victims and arrest the perpetrators.
Investigation into the incident is ongoing, while security agencies said further developments would be communicated.
End
Gunmen abduct five workers at construction site in Kwara
Nine injured in farmers–herders clash in Nasarawa
Soldier killed as troops clash with suspected militia in Taraba
Gunmen abduct five workers at construction site in Kwara
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