Senate is in confusion over the CBN N23.7 trillion loan to the FG

On Wednesday, the Senate was thrown into disarray and total uproar over how to restructure the payment of N23. 7 trillion in “Ways and Means” secured from the Central Bank of Nigeria (CBN) over the last ten years.

Following the incident, Senate President Senator Ahmad Lawan called a closed-door session to avoid fisticuffs.

“Ways and Means” are soft loans or advances made to the Federal Government by the Central Bank to meet short-term or emergency financing needs to fund delayed government expected cash receipts of fiscal deficits.”

The trouble started last week, when the Chairman of the Senate Committee on Finance, Senator Olamilekan Adeola, APC, Lagos West, delivered a report on Ways and Means 2022, as President Muhammadu Buhari had requested.

Senator Apiafi, PDP, Rivers West, raised a point of order shortly after Senator Adeola’s presentation, arguing that President Buhari’s request was unconstitutional and that what the Senate is about to do by considering the request is uncharted territory in Nigerian law.

The Senate became tense when the President of the Senate ruled her out of order, stating that the committee chairman must present and read the report before lawmakers can participate in the debate.

Senator Apiafi and other Senators were irritated by Lawan’s decision, which created a tense atmosphere in the Senate.

Senator George Sekibo, PDP, Rivers East, raised a point of order at this point, requesting that the President of the Senate postpone consideration of the report until lawmakers have more information on how the funds were spent.

The Senate then adjourned to closed session.

Remember that President Buhari wrote to the Senate last week, requesting permission to restructure the Central Bank of Nigeria’s N23.7trillion Ways and Means advances to the federal government.

According to the President, in a letter read by Senate President Ahmad Lawan during Plenary session last Wednesday, Ways and Means are advances from the Central Bank of Nigeria to the federal government for emergency funding of delayed receipt of fiscal deficit.

He estimates that the ways and means balances will be 22.7 trillion as of December 19, 2022.

President Buhari also stated in the letter that he has approved the securitization of the ways and means balances on the following terms:

N23.7 trillion in value, with a term of 40 years and a three-year principal repayment moratorium. The rate of interest is set at 9%.