Senate: Bill seeking amendment of CBN Act passes second reading

A Bill which seeks to stimulate transparency in the operations of the apex bank, the Central Bank of Nigeria (CBN) and insulate it from undue influence of the Executive arm, passed second reading on the floor of the Red Chamber on Wednesday.

Titled, “A Bill for an Act to amend the Central Bank of Nigeria Act and for other related Matters,” was sponsored separately by Senators Darlington Nwokocha (Abia Central) and Sunday Karimi (Kogi West).

Senator Karimi’s Bill was titled,”A Bill for an Act to amend the Central Bank ( Establishment ) Act 2007, to make the Central Bank more Transparent and Accountable in its Operations and to ensure Enhancement of its functions and for Connected Matters Therewith , 2023.”

Presenting his lead debate, Senator Nwokocha said “the Bill sought to amend Sections 6(1), (2); 8(1), (2) (3) (4) (5); 12(1), (2) (3); 13(1) (2) (3) (4) and Paragraph 8 of the First Schedule to the Principal Act.

The proposed amendment according to him was meant to “address the corporate governance and lack deficit of ethical conduct that bedeviled the Central Bank Management over the years by separating the Head of Management from the Head of the Governing Board; Enhance internal mechanisms for improved control system as well as checks and balances in line with global best practices;

“Restore public trust in the CBN as the Banker’s Bank and Monetary Policy institution for optimal performance and resilience.”

The proposed amendment would also guarantee the independence of the CBN from any form of political affinity both from within and without.”

To achieve these objectives, the Senate through the proposed amendments would: Establish the position of Board Chairman; and effective Governing Board to ensure proper internal controls and adequate maintenance of the CBN Act by the Management Committee; Create an additional Deputy Governor position to ensure balance in geo-political spread while maintaining a high level of competence.

The amendment would also ensure proper transparency and accountability in CBN management and Operations.

Senator Karimi’s proposed amendment to section 9(2) of the CBN Act reads: “Notwithstanding the Provisions of this Act or any written law in existence, the Governor and the Deputy Governor of the Bank shall not participate directly or indirectly in partisan politics, nor contest any election, during their tenure in office.”

The amendment, as proposed by Senator Karimi, also seeks to prohibit the use of foreign currency for domestic transactions in Nigeria.

The Bill seeks amendment of Section 20 of the CBN Act, by inserting Section 20(A) immediately after the existing section 20, before the existing section 21.

The proposed amendment reads: “20(A) Prohibition of the use of foreign currency in democratic transactions:

“(1) No person or body corporate shall use any foreign currency as a means of exchange for goods, services and other transactions in markets, supermarkets, hotels, restaurants, airports and other places of business in Nigeria except by a Bank, licensed Bureau De Change and other financial institutions duly authorized by the Central Bank of Nigeria to trade, deal and use such currency and no individual or business entity in Nigeria shall advertise, denominate or price its goods or services in any currency other than the Nigerian Naira and Kobo.

“(2) Any person who contravenes subsection (1) of this section commits an offence and shall be liable on conviction to: (a) in the case of an individual, to a fine of N250,000.00 or a term of imprisonment not exceeding six months or both such fine and imprisonment;

“(b) in the case of a corporate entity to a fine of N1,000,000 and a conviction of three months to its officers or directors who authorized or undertook the transaction.”

On his part, Senator Nwokocha in his lead debate, said the amendment seeks to address all anomalies that have hindered the advancement of the apex bank to handle the ailing economy of the nation.

Deputy President of the Senate, Barau Jibrin who presided at the Senate plenary expressed the hope that the amendment would meet the expectations of Nigerians, anxious for transparency and accountability in the operations of the apex bank.

He said: “It is important that we reposition our laws and the CBN Act to make sure that the apex bank is put in the best position to perform its function. “An integral part of the arrangement of every country is making sure that every country has a Central Bank that will be in control of its monetary policies, because if one is not able to get right there, then that will be something that will be described as catastrophic.

“So, the two bills that are being brought to the Senate are commendable and the robust debates that took place showed the passion in the minds of every Senator here in making sure that all is done to put the apex bank in the best position to perform its function in a way that the country’s interest will be well protected.”

READ ALSO FROM NIGERIAN TRIBUNE