During an emergency plenary session on Sunday, the House of Representatives enacted the amendment to the Central Bank of Nigeria (CBN) Act 2007 as well as the upward review of access to the Ways and Means.
The CBN Act’s Ways and Means provision enables the government to borrow money from the apex bank in an emergency or for a limited period of time to cover a budgetary deficit if scheduled cash receipts are delayed.
By virtue of this development, the House gave its approval to an increase in the bank’s maximum total advance to the federal government from 5% to 15%.
During an emergency session on Saturday, the Senate likewise took similar action.
The Bill was introduced in the House on Thursday by the Chairman of the House Committee on Banking and Finance, Victor Nwokolo and was passed for second reading.
According to the CBN Act, the Ways and Means must not exceed five per cent of the previous year’s revenue.
The CBN Act Section 38(2) & (3) states, “that Ways and Means shall not exceed 5% of the previous year’s revenue of the Federal Government.”
However, Chairman, House Committee on Water Resources, Hon. Sada Soli, kicked against the approval.
He said: “Mr. Chairman does it mean with this amendment that the CBN somehow advances to Government at 10 percent or is it a wake up call at the twilight of this government we are changing this from five percent to 15 percent?
“Can the Chairman, Banking and Currency kindly explain this not only to the National Assembly but to Nigerians. Does it mean the CBN granted this advances at 15 percent or what is going on? This is what we don’t know Chairman.
“I’m a member of the Committee on Banking and Currency. I didn’t know when this discussion took place. I can stand on privilege Order 6 to call for an explanation as a member of this Committee, how we reached at this amendment, please?”
However responding to him, the Deputy Speaker, Hon Ahmed Wase, who presided over the Committee of the Whole said: “Hon. Sada the only explanation I may attempt to give if I listened to you very carefully is this, the Chair has the right to commit after second reading any bill to the Committee of the Whole.
“It is there contained in our Standing Order. It depends on the importance and the exigency of the moment. And in light of this I want to beg our Colleagues to please consider this amendment and we pass it so that we have the right thing done.”
The House of Representatives on May 4, 2023 approved an additional N1 trillion Ways and Means advances for the implementation of the 2022 Supplementary Appropriation Act as passed by the National Assembly as the loans hit N23.7 trillion
The House also approved the Securitization of the total outstanding Ways and Means amount under the following terms: Amount (N23,719,703,774,306.90), Tenure (40 years) , Moratorium on Principal Repayment (3 years), and Pricing/Interest Rate (9 percent per annum)
Also, the House passed a bill seeking to extend the implementation of the Capital Aspect of the 2022 Supplementary Appropriation Act from 30th June, 2023 to 31st December, 2023.
The bill which seeks to approve the sum of N819 billion for capital expenditure and for related matters was considered at the Committee of Supply, thereby raising the budget deficit for 2022 to N8.17 trillion and deficit GDP ratio to 4.43 percent.
The House also passed a Bill seeking to repeal the Produce (Enforcement of Export Standards) Act, 2004.
The bill also seeks to enact the Federal Produce Inspection Service (Enforcement of Export Standards) (Establishment) Bill, 2023 to provide for the Inspection and enforcement of Grades and Quality Standards of Produce and Commodities intended for Export from Nigeria at Ports of Shipment.
The bill was passed after the adoption of the recommendations at the Committee of the Whole, chaired by the Speaker, Hon. Femi Gbajabiamila.
During the emergency session, the House deferred the consideration of a bill seeking to repeal the Revenue Mobilization, Allocation and Fiscal Commission Act, 2004 and enact the Revenue Mobilization, Allocation and Fiscal Commission Bill to grant the Commission enforcement powers in the monitoring of accruals to and disbursement of revenue from the Federation Account and to bring the Act in conformity with the provisions of the 1999 Constitution (as amended).
Also during the session, the Speaker Femi Gbajabiamila read the defection letter of a member from Kwara State, Hon Olododo Cook from the Social Democratic Party (SDP) to the All Progressives Congress (APC).
The House adjourned plenary to Tuesday, May 30, 2023.
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