Senate moves against CBN over alleged financial recklessness

ABUJA—THE Senate, yesterday, moved to check alleged financial recklessness on the part of the Central Bank of Nigeria, CBN, on intervention fund spending every year.

It also accused the apex bank of contravening relevant provisions of the constitution and the Fiscal Responsibility Act through what it described as extra-budgetary intervention to selected bodies, institutions and agencies under the guise of intervention funds.

The upper chamber equally frowned on the N1.23 trillion spent by the apex bank in 2015, far exceeding the totality of five per cent of CBN total revenue in 2014 as provided for in section 38 of its Act.

The move by the Senate was contained in a bill sponsored by Senator Rose Oko (PDP, Cross River North) and passed for second reading, yesterday.

The Bill is entitled: “A bill for an Act to Amend the Central Bank of Nigeria Act 2007 to Ensure Transparency and Accountability in the Operation of the Bank and Subject Intervention Advances to the Approval of National Assembly.”

In her lead debate, Senator Oko lamented that there was no mechanism in place to monitor and track the CBN’s intervention funds over the years,  adding that lack of proper tracking of CBN intervention funds was, among others, responsible for the reason lawmakers could not effectively carry out their oversight functions on the CBN.

In the statistics presented, yesterday, she said besides the N1.23 trillion spent by the CBN in 2015 as intervention funds, far exceeding the totality of five per cent of its revenue in 2014, it was almost equal the N1.8 trillion voted as capital expenditure for the 2016 budget.

She said there was need to bring the CBN Act 2007 in line with provisions of Nigerian constitution by subjecting it to National Assembly scrutiny and approval.

According to her, some of the various intervention funds given out by CBN  without National Assembly approval in recent times are the N620 billion bailout for five banks, including  Afribank Plc, Intercontinental Bank Plc, Union Bank of Nigeria, Oceanic Bank and Finbank plc.

She said the intervention funds were also extended as donations to tertiary institutions running into several billions of naira, the N300 billion bailout to states, drawn from $2.1 billion NLNG’s taxes and dividends to pay salaries.

Virtually all the senators who contributed to the debate on the bill, supported its motive, upon which the Senate passed it for second reading.

It mandated its Committee on Banking, Insurance and other Financial Institutions to carry out more legislative work on it within the next six weeks.

Bill to repeal NDE Act 2004 passes 2nd reading

Also yesterday,  a Bill for an Act to Repeal National Directorate of Employment Act 2004 and to Establish National Youth Employment and Development Agency to provide for promotion, coordination and employment of youths scaled second reading in the Senate.

The bill, which was sponsored by Senator Bassey Akpan (PDP, Akwa Ibom North East), and presented at plenary, yesterday, was after serious debate, referred to the Senate Committee on Employment, Labour and Productivity to report back in four weeks.

In his lead debate,    Akpan said when passed, the bill would generate employment and entrepreneurship and ensure greater opportunities    for youths to secure decent work and income.

Akpan added  that it would help tackle the virtuous circle of poverty reduction, sustainable development and social inclusion.

Source – Vanguard