CBN Ways and Means advances: National Assembly on trial

Nobody could ever have imagined the extent of the financial mess the outgoing Buhari administration will leave behind. According to the Director General of the Debt Management Office (DMO), they are on course to bequeath the nation’s mind-boggling debts totalling N77 trillion! The sad truth is that in eight years, Nigeria’s economic decline and financial […]

Nobody could ever have imagined the extent of the financial mess the outgoing Buhari administration will leave behind. According to the Director General of the Debt Management Office (DMO), they are on course to bequeath the nation’s mind-boggling debts totalling N77 trillion! The sad truth is that in eight years, Nigeria’s economic decline and financial morass has been extreme, inexplicable and unforgivable. The financial legacy of the outgoing administration is that our nation must continue to  borrow simply to repay debts!  In addition to corruption, oil theft, poor financial management and world economic downturn, the monumental debts were caused by contravening constitutional restraints.  

Persistent violation of extant laws enabled the federal government to access, and not repay, “ways and means” loans from the Central Bank of Nigeria (CBN)  totalling N23 trillion. Back in 2016, former CBN governor, Sanusi Lamido Sanusi raised the alarm over violations of Section 38(2) of the CBN Act, which permits temporary advances to the federal government. Sections 38(2), 38(3)9a) and 38(3)9b) of the Act state quite clearly that total amounts advanced “Shall not at any time exceed five per cent of the previous year’s actual revenue” and that such advances must be repaid in the year they were taken, if not then, no further money can be lawfully borrowed. Had the law been adhered to, the federal government’s debt to the CBN should be N219 billion (five per cent of government’s 2021 revenue), not over 10 times more at N23 trillion! It’s self-evident that despite all the sloganeering there were no concrete plans to lift Nigerians out of poverty and no plans to repay the loans. In panic mode on  the eve of their departure, the outgoing administration is requesting the National Assembly (NASS) to convert these unlawful, unbudgeted, unapproved, non-appropriated debts of which no expenditure details have been presented, into loans with repayment tenure of forty years! This is the scandalous situation in which the future of generations to come has been mortgaged. It raises the question of how these debts were allowed to accumulate in the first place. Every system whether human or artificial has feedback and control mechanisms to ensure correct operations.  

The failure of Nigerian democracy has been the failure of the feedback and control mechanisms vested in NASS oversight responsibilities, which serially overlook breaches of the constitution. As several senators and legal luminaries have pointed out, there is no constitutional provision for legalising monies illegally borrowed and already spent, or for  converting them into a constitutionally approved loan. Despite this, the Senate President says he only requires all the documents necessary to reconcile accounts and verify what the money was used for before approval. But truthfully, NASS has neither the time, nor the capacity to tidy up the financial mess before President Buhari’s tenure expires. Proper reconciliation and verification would require carefully studying documents going back as far as 2015 and inspecting the audited accounts of various ministries, departments and agencies (MDA’s) where the money was allegedly spent. This is currently impracticable as most MDA’s have not submitted their audited accounts for at least three years, if not longer! Knowing full well that reconciliation isn’t practicable, NASS is being asked to retroactively approve the loans, even before receiving details of what the money was supposedly used for! Nigerians are understandably skeptical about any justification of the debts because the nation has neither good roads, good railways, pipe-borne water, good government schools, constant electricity nor good hospitals to evidence such massive expenditure. Citizens justifiably ask how come all the borrowing didn’t prevent the nation from overtaking India as the poverty capital of the world.  

In an attempt to divert attention from the salient point of illegality, the minister for finance said failure to “securitise” the unconstitutional CBN debt would cost the nation N1.8 trillion in interest.  It’s simply preposterous to claim that unlawfully accumulated debts must be transmuted into a forty-year loan simply because it will be cheaper! It’s bordering on insults for the executive arm of government to do exactly as they please irrespective of constitutional constraints, then threaten us that it will cost more money if NASS doesn’t unconstitutionally sanction their illegality through yet another “doctrine of necessity!”  

Constitutionally,  NASS has no business entertaining this request, rather their  business is to sanction those responsible.  The nation must not be blackmailed no matter the costs. Realistically, nobody expects the NASS to react in a principled manner and censure both the minister of finance and the CBN governor. However, if they don’t, then they would have abdicated their responsibility and erred in their duty. It will be a confirmation that  in their opinion, public officers who take an oath to uphold the constitution yet betray that oath, are still considered fit for public office! The NASS is now on trial in the court of public opinion. If they agree to schedule repayment over the next forty years, it will be a betrayal of the trust placed in them to uphold constitutionality. It would in effect mean that every Nigerian aged 15 years and above will spend their entire working life repaying unconstitutional debts, while all younger Nigerians including many yet to be born will also bear part of the burden! Most damaging of all, it would mean that NASS would have lost its moral right to insist that private citizens or future governments conform to constitutional limitations on behaving as they please.