April 28, (THEWILL)- The Senate’s probe of N30 trillion Ways and Means loan obtained by the Muhammadu Buhari Administration from the Central Bank of Nigeria (CBN) has snowballed into eight weeks, against the scheduled four weeks deadline for a report.
The Senate had on February 27, 2024 constituted a nine-member ad-hoc committee to probe the disbursement and usage of the humongous N30 trillion Ways and Means loan and to submit report back in four weeks.
The Senate’s action followed public outcry over the detrimental impact of the obviously mismanaged Ways and Means facility on the economy, setting the pace for runaway inflation, which has created severe economic challenges for the people.
Inflation rate surged to an unprecedented 33.2 percent in March 2024, as reported by the National Bureau of Statistics. Government places the high inflation rate at the door steps of the Buhari contrived N30 trillion Ways and Means.
According to the Minister of Finance and Coordinating Minister of Economy, Wale Edun, the N22.7 trillion printed by the Central Bank of Nigeria through Ways and Means overdraft under former President Muhammadu ignited the economic troubles.
Edun, who stated this while briefing the Senate Committee on Finance in Abuja, noted that during the period, the printing of naira in trillions was carried out without any corresponding productive activities.
He said, “We talked about inflation, and you have helped to solve that. Where has it come from? It came from the eight years of just printing money not matched by productivity. It’s not like when you earn dollars and you free it.”
While constituting the ad-hoc probe committee, the Senate further reiterated that the alleged reckless spending of the overdraft collected from the CBN under Buhari largely accounted for the food and security crises facing the country.
The Deputy Senate President, Barau Jibirin, who presided over the plenary, said:
“According to statistics, broad money supply, which is a key parameter for key inflationary trends, increased from N78.3 to 78.4 trillion in 2023. The highest ever recorded in Nigeria.
“The Central Bank of Nigeria’s Ways and Means which provides direct lending to the federal government of Nigeria caused unprecedented liquidity in the economy and the current inflationary pressure that we are experiencing.
“The financial obligation to the CBN now stands at N30 trillion. The inability to repay this temporary accommodation by the federal government of Nigeria led to the regularisation of a 40-year loan at 9 per cent interest per annum.”
The Red Chamber therefore resolved to set up the ad-hoc committee, to investigate the overdraft because the details of the spending were not made available to the National Assembly.
Political and financial experts who spoke to THEWILL expressed skepticism over the Senate’s ability and willingness to pursue the probe to a logical end. They cited several probe cases embarked upon by the Upper Legislative Chamber in the past which failed to yield the expected result. The latest was the probe of the over N11 trillion spent in the repair of Nigeria’s moribund refineries.
The Senate is yet to publish the report of its special committee constituted on October 24, 2023 to investigate all the contracts awarded for the rehabilitation of all state-owned refineries said to have gulped N11.35 trillion in 13 years.
The Senate action followed a motion by Senator Sunday Karimi during plenary, raising concern that the state-owned refineries had been a drain pipe of public finance, depriving the citizens of the benefits of being an oil-producing nation.
The Senate was told that from 2010 to date, Nigeria had spent about N11.35 trillion, excluding other costs in foreign currencies, such as $592, 976, 050.00; £4, 877, 068.47 and N3, 455, 656.93, on the renovation of refineries, yet the facilities remained unproductive.
The committee was directed to submit their findings to the Senate within four weeks (November 24, 2923). Seven months after it was inaugurated, the outcome of the committee’s assignment is yet to be announced by the Senate.
“The Senate’s action would amount to nothing. Nigerian lawmakers are funny characters. Probe and investigation has become their way of passing time when they want to draw the public’s attention. We all know the lawmakers as a bunch of jokers when it comes to critical national issues like they are currently toying with”, said Engr. Greg Ikhehide, an oil and gas operator.
While the public awaited the outcome of the Senate committee set up to investigate the perennial refineries repairs, the government announced that it was set to audit the Nigerian National Petroleum Company Limited (NNPCL).
This was disclosed by the Minister of Finance and Coordinating Minister for Economy, Wale Edun, following criticism of the national oil company by the World Bank which referred to NNPCL activities as lacking in transparency.
Some oil and gas as well as investment experts had reacted to the federal government’s plan to audit the operations of NNPCL amid Senate’s probe of the unending repair of the refineries, describing it as an elaborate hoax that will yield no useful results.
An investment expert and managing director/CEO, Taurus Oil & Gas Limited. Dr Nnaemeka Obiaraeri, had told THEWILL that the government was not telling Nigerians the truth as NNPCL cannot be audited by the same government that has full control over it, without restructuring the organisation.
According to him, the government would pretend to be eager to please the World Bank but, in reality, nothing will come out of it because it is difficult for the government to indict itself over the deep-rooted corruption that the NNPCL is notorious for over the years.
“While the decision to probe the humongous 30 trillion Ways and Means is commendable, this ‘Rubber Stamp’ Senate lacks the capacity to execute it. Except it is aimed at witch-hunting a particular individual, nothing will come sout of it,” said Ademola Bakare, a public affairs analyst.
According to Bakare, it is the same politicians that approved the endless requests from Buhari without asking questions. He recalled that the immediate past Senate President, Ahmed Lawan, had boastfully said the Senate would approve any request from Buhari because the lawmakers are there to serve the people. So, any request from Buhari should be seen to be in the interest of the people.
THEWILL recalls that the Senate had on December 30, 2023 approved the securitisation of the N7.3 trillion outstanding Ways and Means debit balance advance in the Consolidated Revenue Fund of the Federal Government as requested by President Bola Tinubu (which raised the total Ways and Means to N30 trillion).
Some public affairs analysts blamed the wave of frivolous Ways and Means approved by the Senate on the unfortunate mishap where the federal government abandoned raising revenues to focus on cheap money for printing without assets or reserves.
About the Author
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
