The president's request is strikingly against the recommendation of his special investigator on the Central Bank of Nigeria, Jim Obazee, who had said the balance was dubiously and illegally incurred and should be reassessed before Senate authorisation.
President Bola Tinubu has sought Senate approval to convert N7.3trillion balance of ways and means of revenue in Nigeria’s Consolidated Revenue Fund (CRF) into federal assets.
The president's request is strikingly against the recommendation of his special investigator on the Central Bank of Nigeria, Jim Obazee, who had said the balance was dubiously and illegally incurred and should be reassessed before Senate authorisation.
SaharaReporters had reported on Wednesday that Obazee, a former Executive Secretary of the Financial Reporting Council of Nigeria made the recommendation in his final report tagged, “Report of the Special Investigation on CBN and Related Entities (Chargeable offences)” submitted to the president.
The report revealed that the management of the Central Bank of Nigeria under the leadership of former Governor, Godwin Emefiele, fraudulently used N26.627trillion Ways and Means of the apex bank.
In contrast to the investigator's recommendation, Tinubu sent a letter addressed to Senate President, Godswill Akpabio, which was read at plenary on Saturday seeking for the approval to convert the balance.
The president's letter according to the News Agency of Nigeria, read: “I would like to call the attention of the Senate to the provisions of Section 38 of the CBN Act 2007, which stipulates that the apex bank may grant temporary advances to the federal government.
”In respect of the temporary deficiency of budget revenue provided, such overdrafts do not surpass five per cent of government revenue from the previous year.
“The Senate is invited to note that, from available information by the CBN, the Consolidated Revenue Fund (CRF) account of the Federal Government of Nigeria (FGN) stood at N7.3 trillion as of December 2023, which is due to domestic debt servicing, principal, and interest.
“While the federal government is considering various measures to forestall the use of ways and means advances for domestic debt servicing,” he said.
The president said the securitisation was imperative as it would help reduce debt service costs.
“The securitisation of the ways and means will lead to the realisation of the following benefits, among others:
”Reduction of debt service costs as the interest rate for the securitised ways and means is lowered to nine per cent compared to three per cent previously adopted.
“The savings arising from the much lower interest rate will help to reduce the deficit in the budget and improve debt transparency as securitised ways and means advances are included in the public debt statistics.”
”In view of the foregoing, the Senate is invited to kindly consider and approve the securitisation of the outstanding debit balance of N7.3 trillion in the same order as at December 2023.”