Senators, Reps tear N5000 note into pieces … ask Jonathan to stop CBN governor

The  National Assembly on Tuesday passed different resolutions asking President Goodluck Jonathan to stop the Central Bank of Nigeria from introducing its controversial N5000 note.

Members of both the Senate and the House of Representatives resumed from their recesses on Tuesday with the controversial plan by the CBN taking the front burner.

While the Senate unanimously adopted a motion urging “The President and  to direct the CBN to stop all actions on the issuance of the proposed N5000 note and all matters connected therewith,” the House members  directed the apex bank  to  put the plan  on hold  for four weeks.

The House also queried the legality of Jonathan’s Economic Management Committee and its competence in approving the currency review plan.

When The PUNCH sought the reaction of the CBN governor, Lamido Sanusi, to the development, he said, “I have no comment.”

CBN action illegal

The Senators said the CBN’s plan to introduce the N5000  note  was illegal because Section 4(1 and 2) of the 1999 Constitution and Section 8(2) of the CBN Act of 2007 require the National Assembly to be part of the process of introducing a new currency review.

The resolution arose from a motion by Senator Ita Enang (Akwa Ibom North), asking  Sanusi to halt action on the proposed currency.

Leading the debate on the motion, Enang said the Senate was aware of section 18 of the CBN Act, 2007, which conferred on the bank, the power to arrange for the printing of the currency notes and minting of coins among others.

He  said the Senate was also  aware of section 19 of the Act which allowed the bank to issue denominations and fractions with the approval of the President on the recommendation of the board.

He said, “The power being granted by the Legislature is subject to the supervisory powers of the Legislature which granted or donated the powers under the Act if the exercise of the powers is contrary to good economic conscience and the wellbeing of the people and the national economy.

“The introduction of the said N5000 note and the withdrawal of notes, conversion of some to coins and general redenomination of the naira has the ultimate effect of devaluing the naira, making lower currencies to be coined, almost non-value monies for transactions and subtly yield to the off-demand of certain international financial institutions for the devaluation of our currency.

“Section 4(1 and 2) of the constitution  vests the legislative powers of the Federal Republic of Nigeria in the National Assembly to make laws for the peace and good governance of the federation or any part thereof; whereas this policy of the bank on the Naira may not lead to good economic and monetary governance of Nigeria requiring re-examination by the legislature.”

 N5000 negates cashless policy

Enang also said that the currency plan negated the the newly introduced cashless transaction policy.

“In cashless economies, high bills or currency notes such as the proposed N5000 is not required as transactions are conducted from the payer to the payee’s accounts without any need for physical exchange or handling of cash by any of the parties.

“The convenience of carrying large amount of cash by way of large denominations now being proposed does not at all arise since large volume transactions as under the Money Laundering Act are to be conducted cashless through bank accounts of the transacting parties.”

 Unacceptable to Nigerians

Also speaking, Deputy Leader of the Senate, Abdul Ningi, described the policy as unacceptable to Nigerians and ruled out the need for a public hearing since Nigerians had spoken their minds on the matter very clearly.

 Senator Kabiru Gamawa painted a complex picture of what obtained in his senatorial district, saying that at the moment, transactions in N1000 notes  are difficult as locals prefer to use other notes.

“We have those who do not accept the N1000 notes in my constituency right now, how much more N5000,” he said.

Chairman of the Senate Committee on Banking, Insurance and other Financial Institutions, Senator Bassey Otu, explained that in embarking on a major currency review, the CBN ought to have consulted with the National Assembly.

 He said  the new policy was suggestive of a serious problem in the nation’s currency stability and added  that the “woeful failure of coinage in 2005 should be a lesson.”

 I was not briefed – Mark

President of the Senate, David Mark, said he was not briefed about the proposed currency review.

Mark said, “If Nigerians say that they don’t want anything, I think they deserve to be listened to. I have listened to the arguments of those supporting it. Their arguments are not convincing. They are theoretical and do not address the problems in practical terms.

 “The disadvantages of introducing the N5000 far outweigh that of not introducing it. There is no urgent need for us to take this now.”

However, Senator Bashiru Lado,said he had wanted to reject the motion, but superior arguments on floor changed his position.

He said the CBN Governor should be given a fair hearing through the conduct of a public hearing. His request for a public hearing was rejected by a voice vote.

 Stop further action

In the House, members mandated the Committee on Banking and Currency to investigate the “planned restructuring of the  nation’s  currency by the CBN” and submit the report of its finding within four weeks.

Lawmakers  therefore directed the CBN to stop further actions on the proposal pending the outcome of the investigation.

In its resolution, which was unanimously endorsed by members, the House also directed the Committee on Banking and Currency to immediately propose an amendment to the CBN Act. The amendment provide that the apex bank must seek the approval of the National Assembly before the bank could take any decisions on currency denominations.

The motion was sponsored by the Chairman, House Committee on Rules/Business, Mr. Albert Sam-Tsokwa, and 20 other members.

 Bank’s arrogance

Leading debate on the matter, Sam-Tsokwa expressed surprise at the “arrogance” of the  apex bank in the handling of the proposal “in spite of the fact that majority of Nigerians are against it.”

Sam-Tsokwa admitted that though the bank had “awesome” powers under its  Act, the House expected it to exercise such powers “in circumspect and to the best interest of good governance of the country.”

He stated that it was difficult to convince Nigerians that the N5000 note would complement the cashless policy.

 What’s EMT?

Supporting the views of Sam-Tsokwa, the Minority Leader, Mr. Femi Gbajabiamila, observed that “a body unknown to law, the Economic Management Team,” had approved the N5000 note.

He added, “This body is said to have approved the introduction of this note (N5000). The EMT was created by presidential fiat and it  has no legal status.

“Under the 1999 Constitution, we all know that it is only the National Economic Council that is empowered to advise the President on economic matters.

“Now, the EMT has taken over the duty of the NEC. I have not heard that the NEC met to discuss the N5000 denomination.

“I call on Mr. President to convene a meeting of this council and table this issue for deliberations.”

He observed that the National Assembly boxed itself to a corner when it “delegated” its power to determine currency denomination to the CBN.

 Deceitful economists

The Chairman, House Committee on Power, Mr. Patrick Ikhariale, accused government of relying on the analyses of “so-called economists” to endorse the CBN proposal.

“These people are misleading Nigerians by comparing this policy with the case of the United States.

“But, they fail to tell the truth that in  the US, only the $100 bill has been used in transactions since 1969.

“Any attempt to allow the N5000 note into our economy will lead to genocide and economic sabotage,” Ikhariale stated.