THE National Assembly on Monday said it would stop the
Central Bank of Nigeria from introducing its proposed N5, 000 note.
While the Senate said only a major currency crisis
could warrant a review as proposed by the CBN governor, Mallam Lamido Sanusi,
the House of Representatives said the proposed review as far as it was
concerned did not exist.
Sanusi had announced last Thursday the CBN’s proposal
to roll out new N5,000 notes early next year and to convert to coins the
present N5, N10 and N20 notes. There are already 50k, N1, and N2 coins in
circulation which Nigerians had largely rejected.
The PUNCH had reported
on Monday that the apex bank had already earmarked N40bn for the production of
the new notes and coins.
Chairman of the Senate Committee on Banking, Insurance
and other Financial Institutions, Bassey Otu, at a media briefing in
Abuja, said the Senate would send a letter to Sanusi to stop the implementation
of the proposed review of the nation’s currency.
Otu said, “We are asking, and we will be sending a
letter to them (CBN) to stop all further actions until the Senate of the
Federal Republic of Nigeria is properly briefed.
“We have not been properly briefed and we don’t know
the reason for it; even though at the moment, we do know that inflation is
really a problem but I don’t think we have used all the mechanisms we have to
tackle it and it’s not really out of hand.
“I believe that a project of this nature requires
parliamentary approval because there are numerous monetary and fiscal
implications on the nation’s economy.
“This type of action is only taken where there is
a major currency crisis and the CBN must be careful in order not to send a
wrong signal or message to households or the domestic sector or even the
external economies that the Nigerian currency is valueless which I believe is
definitely not and that for every unit of value, they need to carry a large
quantity of cash.”
Otu said the country had not developed the the basic
infrastructure for efficient use of coins.
He stressed, “We believe that the coinage works very
well where there are infrastructure and we’ve not developed that basic
infrastructure and even now, the coins are nowhere to be found.
“The CBN would have to prove that the policy is not a
clear contradiction or at variance with the cash-less society which they have
even yet to justify and whether this is the popular economic way to go.
“In 2005, the CBN undertook a major currency
restructuring which ran into billions of naira. Till date, the proper value
assessment has not been done to know its cost to the Nigerian taxpayer and the
extent of the benefits and in that 2005 coinage, I think it did not work at all
because both the goldsmith and the blacksmith converted the coins to moulding
bangles and earrings and so on and so forth.”
Otu recalled that the CBN in 2008 and 2009 came
up with a proposal to re-denominate the currency to remove the zeros but did
not happen, but wondered why there was a policy summersault.
On its part, the House stated that it expected that the
CBN governor should have consulted with lawmakers before coming up with the
policy.
“The House is not aware that the CBN intends to print
N5, 000 notes. We have not been consulted. On such a matter as this, the
National Assembly should be consulted. But, for now we are not aware”, House
Deputy Majority Leader, Mr. Leo Ogor, told The PUNCH in a telephone interview
on Monday.
Attempts to get reactions of the CBN to the National
Assembly’s position failed. The CBN Director, Corporate Communications
Department, Mr. Ugochukwu Okoroafor, did not pick calls to his mobile
telephone. He did not also respond to a text message on the matter at the time
of going to press.
Meanwhile, the leadership of the Trade Union Congress
has called on President Goodluck Jonathan to withdraw the approval he granted
to Sanusi to introduce the N5,000 denomination.
The TUC said the new policy would not serve the
interest of Nigerians but that it would aggravate the nation’s economic crisis.
The TUC also called on the leaders of the CBN to
suspend its decision on conversion of the lower denomination of N5, N10, and
N20 notes and subject the issue to further discussions among Nigerians and to
make public the implications of the new policy on the Nigerian taxpayer.
The TUC’s comments were contained in an electronic mail
of Monday signed by its President General and Secretary General, Mr. Peter
Esele and Chief John Kolawole, respectively.
The statement said the new policy would promote the
scourge of corruption rather than fighting it, arguing that the introduction of
the new N5, 000 notes would make it easier for large volumes of cash to be
moved which they said would result in an unfortunate increase in corruption in
the country.
The TUC statement read, “Once again, Nigerians are
witnessing another round of the theatre of the absurd orchestrated by the
Central Bank of Nigeria under the leadership of Sanusi Lamido Sanusi. Last
time, we were treated to the unfortunate characterisation of the CBN as an
unserious and insensitive Charity organisation run without recourse to statutes
and due process…
“We do not see any serious value in what the CBN
intends to do, especially at this time when we are confronted with bigger
issues of insecurity, unemployment, hunger, poverty, disease, decaying social
and physical infrastructure and the deepening of mistrust and widening of the
ethnic gaps within the nation.
“Stability is the name of the game in money
management if we are to achieve result but we do not see how this present
action will lead to that.
“We therefore call on the CBN to immediately suspend
this pursuit, allow it to be discussed nationally as our experience has shown
that the outcome of this will affect the majority of Nigerians adversely before
any further action is taken. We would also want the CBN to tell Nigerians
what it will cost the taxpayers to move to this new currency regime.”