Home Economy Senate turns down Buhari’s request for securitisation of N22.7trn Ways and Means over failure to provide details

Senate turns down Buhari’s request for securitisation of N22.7trn Ways and Means over failure to provide details

by Business News Report

Senate has turned down Buhari’s request for securitisation of N22.7 trillion borrowed from Central Bank of Nigeria as Ways and Means as the Executive failed to provide the necessary details and composition of the loans. The Senate had planned final consideration and passage of N22.7trillion Ways and Means Restructuring request forwarded to it and the House of Representatives by President Muhammadu Buhari in December, 2022 for expeditious consideration. The  debt of N22. 7 trillion “Ways and Means” was secured from the Central Bank of Nigeria(CBN) in the last 10 years. Refusal of the Senate to pass the N22.7trillion Ways and Means Restructuring request by President Buhari has succeeded in placing  Nigeria as a country at risk of incurring additional N1.8trillion debt as warned by the President three weeks ago when he assented to  N21.83trillion 2023 budget. 

At the commencement of plenary, there were strong Indications that the lawmakers would throw out the request against the backdrop that consideration for it was neither listed on the Order Paper used  nor mentioned by the Senate leader who is the Chairman of the Special Committee set up for that purpose. It was gathered that Senators had vowed to kick against the passage of the over CBN loan of N22. 7 trillion  to the Federal Government because they want the breakdown  on how the money was spent and for what purpose. The President of the Senate, Senator Ahmad Lawan had  last week Tuesday declared that the Senate was ready to approve the request,  provided required details of the spendings were made available by the Finance Minister, Zainab Ahmed and Governor of the Central Bank, Godwin Emefiele. The Senate and the House of Representatives would have adjourned plenary on Thursday last week till after the Presidential and National Assembly election  if not for Restructuring of N22.7trillion Ways and Means request , 

Lawan had said last week that ” We must have necessary information for passage of the N22.7trillion Ways and Means Restructuring  request as time is not on our side in the Senate now in view of coming general elections. If there is need for the Senate to sit up to Friday ( last week)  for thorough consideration and passage of the request , it will be done but the affected officials from the executive must also expedite action on provision of required information as regards documents authorising approval and disbursement of the monies totalling N22.7trillion.” Till the end of yesterday’s sitting, Senator Gobir led committee did not present any report for consideration by the Senate, making it  to adjourn without approving it as earlier planned. It was gathered the expected details from the executive arm of government on how the N22.7trillion was expended within 10 years, were not provided.

President Muhammadu Buhari had warned three weeks ago that Nigeria risks  incuring additional N1.8billion with non – approval of the   requested N22.7trillion Ways and Means Restructuring   by the National Assembly. President Buhari who gave the warning when assenting to the N21.83trillion 2023 budget had said : ” Balance of N22.7trillion Ways and Means,  has accumulated over several years and represents funding provided by the CBN as lender of last resort to the government to enable it to meet obligations to lenders, as well as cover budgetary shortfalls in projected revenues and/or borrowings. I have no intention to fetter the right of the National Assembly to interrogate the composition of this balance, which can still be done even after granting the requested approval. Failure to grant the securitisation approval will however cost the government about N1.8 trillion in additional interest in 2023 given the differential between the applicable interest rates which is currently MPR plus 3% and the negotiated interest rate of 9% and a 40year repayment period on the securitised debt of the Ways and Means”.

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