Following his decision to approve the Central Bank of Nigeria (CBN) request for an extension of the deadline for old Naira notes collection, President Muhammadu Buhari is reportedly on a collision course with the House of Representatives.
In a national broadcast on Sunday, the governor of the CBN, Godwin Emefiele had announced the extention of the deadline from January 31 to February 10, 2023.
The CBN governor also announced a seven-day grace period, beginning on February 10 to February 17,2023, to enable Nigerians deposit their old notes at the CBN after the February deadline when the old currency would cease to be recognised as legal tender.
But the House of Representatives in a swift reaction yesterday, rejected the extension, insisting that the CBN complied with its resolution that the deadline be extended by six months.
The 10-days extension of the deadline was approval was given by the President after meeting with the apex bank’s governor, Mr. Godwin Emefiele, in Buhari’s country home in Daura, Katsina State on Sunday.
The President consented to Emefiele”s request, urging more time, discretion and order to enable Nigerians successfully change their currencies to the redesigned notes, and reduce the risk of loss, especially among the underserved in rural areas.
Emefiele briefed correspondents after the meeting, revealing that 75 per cent of the N2.7 trillion held outside the banking system had been recovered, with evident drop in the rate of inflation, more stability of foreign exchange rates, and noticeable impact on security, especially in banditry and kidnapping figures.
He said: “First, I will like to thank Mr. President for giving the CBN the approval to embark on this ambitious programme because, like I said, in the past, the CBN has not had the opportunity to embark on such currency redesign programme in last 19 years.
“Let me emphasize that only an incorruptible leader of the President’s stature can give such approval to the CBN.’’
The CBN governor, who noted that currency redesigns were supposed to be every five to eight years, said: “Our aim is mainly to make monetary policy decisions more efficacious and as you can see, we have started to see inflation trending downwards and exchange rates relatively stable.
“Secondly, we aim to support the efforts of our security agencies in combating banditry and ransom taking in Nigeria through this programme and we see that the military is making good progress in this important task.
“We are happy that so far, the exercise has achieved a success rate of over 75 per cent of the N2.7 trillion held outside the banking system. Nigerians in the rural areas, villages, the aged and vulnerable have had the opportunity to swap their old notes; leveraging the Agent Naira Swap initiative as well as the CBN Senior staff nationwide sensitization team exercise.
“Aside from those holding illicit/stolen Naira in their homes for speculative purposes, we do aim to give all Nigerians that have Naira legitimately earned and trapped the opportunity to deposit their legitimately trapped monies at the CBN for exchange.
“Based on the foregoing, we have sought and obtained Mr President’s approval for the following:
“10-day extension of the deadline from January 31, 2023, to February 10, 2023; to swap Naira legitimately held by Nigerians and achieve more success in cash swap in our rural communities after which all old notes outside the CBN losses their Legal tender Status.
“Our CBN staff currently on mass mobilization and monitoring together with officials of the EFCC and ICPC will work together to achieve these objectives.
“A 7-day grace period, beginning on February 10 to February 17, 2023, in compliance with Sections 20(3) and 22 of the CBN Act allowing Nigerians to deposit their old notes at the CBN after the February deadline when the old currency would have lost its Legal Tender status.
“We, therefore, appeal to all Nigerians to work with the CBN to ensure a hitch-free implementation of this very important process for program.”
The head of the apex financial regulator said available data had shown that currency-in- circulation in 2015 was only N1.4 trillion, while as at October 2022, currency in circulation had risen to N3.23 trillion, out of which only N500 billion was within the banking industry.
He said N2.7 trillion was held permanently in people’s homes.
“Ordinarily, when CBN releases currency into circulation, it is meant to be used and after effluxion of time, it returns to the CBN thereby keeping the volume of currency in circulation under the firm control of the CBN.
“So far and since commencement of this programme, we have collected about N1.9 trillion; leaving us with about N900 billion (N500 billion + N1.9 trillion),’’ the CBN governor said.
According to him, to achieve effective distribution of the new currency, the CBN has taken some steps.
He said several meetings were held with Deposit Money Banks who were provided with guidance Notes on processes they must adopt in the collection of the old notes and distribution of the new notes, including directives that new notes should be loaded in ATMs nationwide for equitable and transparent mechanism.
The CBN governor explained that the regulatory body worked with the media, (print and broadcast), and the National Orientation Agency for sensitization of citizens, while 30,000 super agents were deployed nationwide, particularly in rural areas, regions underserved by banks and to reach the weak and vulnerable for currency swap.
To ensure compliance, Emefiele said staff members, mostly assistant directors, deputy directors and directors in Abuja were sent to all CBN branches nationwide to join the mass mobilization campaign and monitoring programmes.
The CBN boss also said operatives of anti-graft agencies, such as the Economic and Financial Crimes Commission, EFCC, and Independent Corruption Practices and other Related Offences Commission, ICPC had been deployed to CBN branches and banks’ branches across the country to monitor the excise.
His words: “We have received some reports of some breaches by some banks’ branches; we have agreed with the executive chairman of EFCC and ICPC to assist us by sending their staff to all CBN and DMBs’ branches nationwide to join in monitoring the implication of these guidelines.’’
It will be recalled that last week the House via a resolution, demanded an extension of the deadline by six months. The House further constituted an adhoc committee, headed by the Leader of the House, Ado Doguwa, to interface with the governor of the CBN, Godwin Emefiele, and the Chief Executive Officers of commercial banks on the scarcity of the notes.
In a statement rejecting the 10 days extension of the deadline approved by President Buhari yesterday, Doguwa said: “The 10-day extension for the exchange of the old naira notes is not the solution. We as a legislative committee with a constitutional mandate of the House, would only accept clear compliance with section 20 sub 3, 4, and 5 of the CBN act and nothing more.
“Nigeria as a developing economy and a nascent democracy must respect the principle of the rule of law.”
Doguwa said under his chairmanship, the committee would continue its work until it got the demands of Nigerians addressed in accordance with the laws of the land.
Describing the extension as a mere political gimmick to further deceive Nigerians and worsen their economic and social livelihood, Doguwa said the policy was capable of frustrating the forthcoming general elections, insisting that the House would issue a warrant of arrest on the CBN governor, if he failed to appear before the committee, which is expected to wind off its activities tomorrow.
“Security agencies and their operations, especially at the state level, are generally funded through cash advances and direct table payments of allowances to operatives during elections,” he said.
Minority caucus hails apex bank over deadline extension
In a related development, the minority caucus of the House applauded the CBN for listening to Nigerians and extending the deadline for swapping of the old naira notes for new ones by 10 days.
Speaking through a statement signed by the minority leader, Ndudi Elumelu, the caucus also hailed President Buhari for heeding the advice of the presidential candidate of People’s Democratic Party, PDP, Alhaji Atiku Abubakar.
“The 10 days extension of deadline from January 31, 2023 to February 10, 2023 is a welcome decision to ease the suffering as well as social and economic discomfort being faced by many Nigerians in accessing the new naira notes within the earlier stipulated deadline.
“As lawmakers and representatives of the people, our caucus commends the CBN for being considerate towards the well-being of Nigerians; which is the essence of democratic governance all over the world.
“Our caucus applauds the presidential candidate of Peoples Democratic Party, PDP, Atiku Abubakar, for his intervention in persuading President Muhammadu Buhari and CBN to extend the earlier deadline in the national interest.
“Atiku Abubakar’s patriotic intervention at this time further shows him as a compassionate leader who is always concerned and committed towards the wellbeing of Nigerians. He has again demonstrated his experience, capacity, and competence to get the system to work in the interest of Nigerians at a very critical time.
“Our caucus calls on Nigerians not to rest on their oars but take maximum advantage of the 10 days extension to swap their old naira notes for the new ones.
“The minority caucus also urges the CBN to remain focused and intensify its sensitization efforts, while putting every measure in place to assist Nigerians, especially those in the rural areas, to access the new naira notes,” the statement read.