by John Ameh
Stakeholders
in the financial sector, including a former Minister of Finance, Mr.
Adamu Ciroma, and an ex-Central Bank of Nigeria Governor, Chief Joseph
Sanusi, on Monday, opposed the bid by the House of Representatives to
tamper with the CBN autonomy.
They cautioned the House against
altering the globally accepted trend, which encourages an autonomous
and financially-independent apex bank.
There is a bill before the House, which
seeks to amend the CBN Act 2007 by transferring the power of the board
of the bank to approve its budget to the National Assembly. The bill
also proposes to cut the membership of the board from 12 to seven and to
appoint another person, other than the CBN governor, as the chairman of
the board.
Ciroma and Sanusi spoke at a public
hearing organised in Abuja by the Joint House Committee on
Banking/Currency and Justice to amend the CBN Act.
Ciroma, a former CBN governor, wondered
what aim the proposals would achieve. He argued that to whittle down the
power of the CBN governor or exclude the deputy governors from the
decisions of the board was “out of line with international best
practices.”
Ciroma said, “The CBN board has always
been made up of executive members of the bank and private sector persons
who have distinguished themselves.
“There is a great danger in excluding
the governor and the knowledgeable people in the economy and banking
system from the CBN.”
On his part, Sanusi told the committee
that the proposals were strange to him, adding that he was at a loss
over what the House aimed to achieve.
Sanusi said, “We are not moving in the right path because in all countries of the world, the CBN governor heads the board.
“The only exceptions will be
inconsequential CBNs. To be different has very serious implications for
inflation. “It means we have a CBN that no longer has control.”
Sanusi observed that the proposed
amendments must have come out of some misunderstanding between the
current CBN governor, Mr. Lamido Sanusi, and the National Assembly. He
urged both parties to make efforts to bridge any communication gap
between them.
CBN Deputy Governor (Banking
Operations), Mr. Tunde Lemo, also kicked against the amendments on the
grounds that a CBN without autonomy was as good as no CBN.
He explained that due to the impact of
the bank’s policies on the economy, it could not afford to subject its
decisions to external influences such as the National Assembly.
“The CBN Act, 2007, works effectively as it is now and requires no amendments,” he said.
According to Lemo, the aim of the apex bank is not to make policies that will achieve immediate political aims.
“The CBN cannot afford to wait for bureaucratic approvals before acting fast in taking decisions,” he argued.
“If the CBN had waited for the approval
of the National Assembly before doing what it did (banks bailout), maybe
by now there would have been no banking sector in this country,” he
added.
Apart from leading to higher inflation,
he claimed that a CBN without autonomy would be unable to perform its
lender of last resort function, among others.
Other stakeholders that opposed the
proposed amendments included the Nigerian Labour Congress, the Institute
of Chartered Accountants of Nigeria, the Nigeria Deposit Insurance
Corporation of Nigeria, Chartered Institute of Bankers of Nigeria, First
Bank Plc, Zenith Bank and Ecobank.
However, the Chairman of the committee,
Mr. Jones Onyereri, told the session that the House had no motives other
than to strengthen the CBN and make its operations more transparent and
open .
The Minority Leader of the House, Mr.
Femi Gbajabiamila, argued that if the President of the country could not
spend “a penny without the approval of the National Assembly,” he did
not see why the CBN should not be accountable to Nigerians.
Punch
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