The controversy trailing the proposed creation of the N5000 note took a new twist as the Senate has directed the Central Bank of Nigeria (CBN) to halt the move.
The CBN governor, Sanusi Lamido Sanusi, last week, announced that a N5000 bill will be introduced next year.
The move has since elicited negative reactions from the Nigerian Labour Congress (NLC) as well as a section of the opposition on grounds that it will further devalue the naira.
But the Special Adviser to the President on National Assembly Matters, Senator Joy Emodi, hailed the move stressing that the pictures of Funmilayo Kuti, Margaret Ekpo and Gambo Sawaba, which will be put on the note is in recognition of the contribution of women in the development Nigerian.
However, the senate committee on banking, currency and other financial institutions, Senator Bassey Otu (Cross Rivers, South)pulled the plug on the new bill proposal adding that the Senate is yet to be briefed on the merits and demerits of the proposal.
While he noted that a project of this magnitude needs the approval of the National Assembly to sail through, he highlighted that previous policies of the CBN have yielded little results, expressing dismay that policy somersaults seems to be the mainstay of the CBN in recent years.
He said “the senate is not really against the independence of the CBN, but what we want in place is proper check and that there should be checks and balances in all these things that we do. So, I believe that at some points we will be able to sit down together and look at the merits and demerits, but till date we do not know anything about it and we do not know what the people stand to gain and until that is properly put through, we say everything about it must stop.
He continued “I am the chairman of the senate committee on banking, currency and other financial institutions. We have also read in the papers just like you about the currency restructuring that the CBN embarked on.
“I believe that a project of this nature requires parliamentary approval because there are numerous and fiscal implications on the entire economy.
“This type of action is only taken where there is a major crisis and the CBN must be very careful in order not to send a wrong signal or message to households, domestic sector and even the external ones that the Nigerian currency is valueless, which I believe it is definitely not, and that for every unit of value they need to carry a large quantity of cash.
“The CBN in 2008 and 2009 came up with a proposal to re-denominate the currency, that was even to take off the zeroes. This was just 2008 and 2009 and here we are in 2012 we have seeing a kind of policy somersault even though we understand the dynamics of the sector very well. I believe that we have to be well briefed on this.
“Also in 2005, the CBN undertook a major currency restructuring which ran into N billions. Till date a proper value has not been done to know its costs to the Nigerian taxpayers and the extent of the benefits and in that 2005 coinage, I think it did not work at all because both the goldsmiths and the blacksmiths converted the coins to molding bangles, earrings and so on etc.
“So, we believe that the coinage works very well where there is infrastructure to take it like a half, probably like a parking where you go and put it etc. We have not developed that real basic infrastructure and those coins most of them are nowhere really to be found.
“So, the CBN will have to prove that the policy is not a clear contradiction or at variance with cashless society, which they are even yet to justify and whether this is the popular economic way to go.
“So, we are asking and we are sending a letter to them to stop all further actions on this until the senate of the federal Republic is properly briefed.
Well, we have not been properly briefed yet so I would not know, we do not know the reason for it, even though at the moment we do know that inflation is a problem, but I don’t think that they have used all the mechanisms to tackle it and it is not really out of hands.
There has not been any meeting with the CBN yet. Well, this is a major, major policy issue and there is no way this kind of thing can go on without us knowing everything about it, the details in order to know how it will affect the people of Nigeria. So, till this moment, we don’t.”