The Senate has approved the request of President Muhammadu Buhari to restructure N22.7 trillion Ways and Means loan advanced to the Federal Government by the Central Bank of Nigeria (CBN)
The approval followed the consideration of the report of the Senate’s Special Committee on Ways and Means chaired by Senate Leader, Senator Ibrahim Gobir (APC – Sokoto East).
The Ways and Means provision allows the Federal Government to borrow short-term or seek emergency finance from the CBN to fund delayed government’s expected cash receipts of fiscal deficits.
Since the government started experiencing a significant shortfall in revenue, it has relied heavily on the Central Bank to finance its expenditure programmes via ways and means.
The funds advanced to the Federal Government under the Ways and Means provision stood at N22.7 trillion as of December 19, 2022.
President Buhari last year requested the Senate to approve his proposal to securitize the loan but the Red Chamber rejected the request, citing lack of details.
Buhari appealed to the Senate to reconsider its stand insisting that failure to grant the securitization approval would cost the government about N1.8 trillion in additional interest in 2023.
Senate President, Ahmad Lawan, after the approval of the President’s request noted that the Ways and Means Advances was a global practice.
