In a significant development, the Senate has announced its decision to launch a thorough investigation into the N30tn Ways and Means loans obtained and utilized by the former President Muhammadu Buhari-led administration.
The Ways and Means loan facility, which is utilized by the Central Bank of Nigeria (CBN) to bridge the government’s budget shortfalls, has come under scrutiny due to concerns over reckless spending and its alleged contribution to the prevailing food and security crises in the country.
Citing the lack of transparency surrounding the utilization of the N30tn overdraft obtained from the CBN under the leadership of Godwin Emefiele, the Senate has established an ad hoc committee to thoroughly examine the expenditure details of the loan during the previous government’s tenure. The committee, to be constituted today, will also investigate the N10tn allocation to the Anchor Borrowers Scheme, the $2.4bn forex transaction out of the $7bn obligation, and other intervention programs.
The Senate’s decision comes at a time when Nigerians are grappling with a biting food crisis, rising inflation, naira depreciation, and escalating insecurity. President Bola Tinubu and his economic team have faced intense criticism for the economic challenges resulting from last year’s fuel subsidy removal and exchange unification policy. Tinubu’s cabinet members argue that the current crises stem from mismanagement during the Buhari regime, and the current reforms aim to rectify past mistakes.
The probe initiated by the Senate is expected to shed light on the alleged mismanagement of the country’s resources during the Buhari administration. In January 2023, Buhari requested the conversion of the N22.7tn Ways and Means loan into a 40-year bond with a moratorium of three years. Additionally, he sought approval to borrow an additional N1tn to fund the N819.5 billion 2022 supplementary budget, which was approved by the lawmakers last December.
While the House of Representatives approved the conversion of the N23.7tn loan to a long-term bond, the 9th Senate faced a chaotic session as some lawmakers demanded the details of Buhari’s proposal before approving the CBN loan. The contention arose from concerns that the National Assembly was not adequately informed when the funds were obtained from the Central Bank.
The Senate’s resolution to initiate a fresh investigation followed the consideration of the report presented by its Joint Committee on Banking, Insurance and Other Financial Institutions, Finance, National Planning, Agriculture, and Appropriation on the state of the economy. During the plenary session, senators engaged in a heated debate, reflecting previous discrepancies regarding the passage of the N22.7tn Ways and Means by the 9th Senate in May 2023 and the subsequent passage of N7.2tn in December 2023 by the 10th Senate.
The investigation aims to unravel the details of the N22.7tn Ways and Means loan, subsequently increased to N30tn, and the N7.2tn accrued interest. Senators expressed their concerns about the food and security crises faced by the nation, emphasizing the need for scrutiny of the spending and the implementation of measures to combat insecurity and support food production.
The executive summary of the Senate’s joint committee report highlights the challenging state of the Nigerian economy, attributing it to fiscal and monetary policy actions of previous governments. The report draws attention to the direct lending of approximately N30tn by the CBN to the Federal Government, which is identified as a major driver of inflation, particularly in the food sector. The report also acknowledges the depreciation of the naira against the dollar, contributing to increased inflationary pressures and foreign exchange speculation.
As the Senate probe panel commences its investigation, key members of the previous administration’s cabinet are expected to be summoned to provide insights and clarifications regarding the utilization of the CBN loans.
The People’s Democratic Party (PDP) has expressed its support for the proposed probe of the Buhari administration by the National Assembly. The PDP Deputy National Publicity Secretary, Ibrahim Abdullahi, stated that the current hardships faced by Nigerians were a result of the actions and inactions of former President Buhari. Abdullahi called for Buhari himself to be probed, emphasizing that Nigeria cannot continue in the same manner with leaders inflicting hardship on the citizens and going unpunished. The PDP welcomed the Senate’s investigation as a step towards restoring Nigerians’ faith in the system.
The Labour Party (LP) also welcomed the Senate’s plan to probe the Buhari administration but expressed doubts about whether the Senate would follow through. The LP’s National Publicity Secretary, Obiora Ifoh, stated that Nigerians do not trust the current Senate, which they perceive as being aligned with the government led by President Bola Tinubu. Ifoh questioned whether the Senate had the political will to investigate the All Progressives Congress (APC), as the current government is a continuation of the Buhari administration.
Efforts to obtain comments from former Minister of Information and Culture Lai Mohammed were unsuccessful, and the counsel to Godwin Emefiele, Matthew Bukka, did not respond to calls at the time of the report.
Source: The Punch