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Nigeria to spend next 40 years repaying controversial N23.72tr CBN overdrafts to FG



Nigeria to spend next 40 years repaying controversial N23.72tr CBN overdrafts to FG


The Senate, yesterday, abandoned its previous hard line stance and approved the conversion to a 40-year bond of the N23.72 trillion Federal Government’s unappropriated expenditure funded by the Central Bank of Nigeria (CBN) through its ways and means (W&M) window.

NaijaNews reports that President Muhammadu Buhari, last year, wrote the National Assembly to approve the amount alongside a fresh N1 trillion it planned to take from the window (bringing the total value earmarked for securitisation to N23.72 trillion) for conversion to a 40-year tenure bond priced at nine per cent.

The bond conversion, which would ultimately move the amount from the balance sheet of the CBN to the Debt Management Office (DMO) for management, has a three-year moratorium, the Buhari administration disclosed.

The Senate and the House of Representatives had at several times turned down approval for lack of proper explanation on how proceeds of the loans would be spent.

With the Senate’s approval, the President’s efforts to push through has now narrowed to the House of Representatives, which had rejected the plea for lack of sufficient explanation of the utilisation of the facility. Sources said the Reps might discuss the request for possible approval when they convene next week.

The lower chamber would have approved the fresh additional borrowing of N1 trillion before proceeding on election recess but held back its approval for the restructuring of the controversial N22.72 trillion, seeking further explanation on the accumulation.

When the lower chamber of the National Assembly approves the request, the amount would be moved from the CBN book where it is currently being serviced at 21 per cent interest. The Federal Government said it agreed to an interest rate payment of the going monetary policy rate (MPR) plus 300 basis points (bps) as the price of the loan. MPR is currently 18 per cent with the possibility of a further upward review.

Buhari hinted late last year that the Federal Government would spend an additional N1.8 trillion servicing the debt except it is converted to a sovereign bond priced at nine per cent. The Guardian had reported that with the current interest of 21 per cent, the government could spend as much as N4.6 trillion as the cost of yearly servicing.

If the President secures consolidated approval in the coming weeks, the current cost of the loan would come down by as much as 57 per cent. But that depends on if the nine per cent negotiated bond price subsists as the cost of commercial debt has increased in the past months.

The approval could open a floodgate of litigation over the legality of the accumulated W&M advanced ab initio. When the Buhari administration assumed office, CBN’s overdraft to the government stood at N789.7 billion. The amount has since 2015 ballooned by 2,902 per cent to its current value (N23.72 trillion).

But the controversy is more about its alleged violation of the CBN Act than the alarming growth. According to Section 38 of the CBN Act, “the Central Bank may grant temporary advances to the Federal Government in respect of temporary deficiency of budget revenue at such rate as the Bank may determine.”

But it adds: “The total amount of such advances outstanding shall not at any time exceed five per cent of the previous year’s actual revenue of the Federal Government. All advances shall be repaid as soon as possible and shall, in any event, be repayable by the end of the Federal Government financial year in which they are granted and if such advances remain unpaid at the end of the year, the power of the bank to grant such further advances in any subsequent year shall not be exercisable, unless the outstanding advances have been repaid.”

Yesterday, a renowned monetary policy expert and professor of applied economics, Godwin Owoh, said Senate’s approval amounts to illegality that would be challenged by the court by interested Nigerians.

Describing the legislative action as approval in arrears, he said the National Assembly should have focused on interrogating how the proceeds of the loans, which were not appropriated.

The administration relied on the window to cater to short-term or emergency needs and fund delayed expected cash receipts.

Adopting the report of its special committee on W&M advances, which considered the request of the President on the issue, the Senate said the restructuring was approved because the advances were made to ensure that the government did not shut down.

The Senate further approved the sum of N180.46 billion being the balance of the supplementary budget and the interest accrued on the W&M advances.

The upper legislative chamber warned that subsequently “if there is a need to exceed the five per cent threshold of the prior year’s revenue, recourse must be made to the National Assembly for approval.”

On states, whose budget shortfalls were also funded through the CBN lending window, the Senate advised: “The Federal Government should begin the process of recovering the portion of the W&M given as loans to state governments as further deferment of the repayment of the loans by the states will not be healthy for the economy.”

It also urged the government to expedite action on the repayment of the loans through treasury bills and bond issuance, saying it will not condone future accumulation without recourse to the National Assembly.

Presenting the report of the special committee, its Chairman and Senate Majority Leader, Ibrahim Abdullahi Gobir, said the committee found out that “part of the monies were given to state governments as loans to augment budgetary shortfalls in their various states”.

“Most of the requests for funds for an increase in W&M were made to Mr. President on the need to finance the budget due to revenue shortfall. Such requests were either made by the Minister of Finance, Budget and National Planning or the CBN Governor.

“The Federal Government as a result of revenue shortfalls occasioned by the COVID-19 pandemic and low oil prices relied heavily on the W&M to finance its budget deficit to keep the country working for the people. The monies received by the Federal Government were actually used for funding critical projects across the country.

“Due to the serious shortfall in Government Revenue, the Federal Government for the economy not to collapse, was compelled to borrow repeatedly from the CBN, exceeding the five per cent threshold of the prior year’s revenue as stipulated by the CBN Act,” the report stated.

The report further disclosed, “the Federal Government through the Ministry of Finance, Budget, and National Planning has concluded plans to convert the CBN loans to tradable securities such as treasury bills and bond issuance”.

Mobilising his colleagues for the rejection of the President’s request earlier, Senator George Thompson Sekibo explained that the advances were illegal and unconstitutional. He informed the Senate that the action of the President was in breach of the CBN Act and the Senate standing rules.

“We should be abreast with the information that such money was going to be taken because it was being taken on behalf of the people of Nigeria and we are entrusted with the power to make laws. They brought this without details for us to approve,” the Senator said.

But the Senate President, Ahmed Lawan, attempted severally to get the Senate to accede to the president’s request – a plea that hit the rock.

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Justice Rahman Oshodi of a Lagos Sexual Offences and Domestic Violence Court, yesterday, sentenced 42-year-old Suleiman Usman to life imprisonment for defiling his daughter.




Justice Rahman Oshodi of a Lagos Sexual Offences and Domestic Violence Court, yesterday, sentenced 42-year-old Suleiman Usman to life imprisonment for defiling his daughter.


The judge sentenced him after he was found guilty as charged.

NaijaNews reports that the Lagos State government had arraigned Usman on a two-count charge bordering on defilement of his two daughters, who were eight and five years respectively, at his No.2 Bale Street, Onisewo in the Apapa area of Lagos State.

The defendant was 37 years when he committed that offence in 2018, while the survivors were eight and five years.

His offence contravened the provisions of section 137 of the Criminal Law of Lagos State 2015.

He had pleaded not guilty to the two counts charge.

Usman was first arraigned before Justice Sybil Nwaka, sometime in October 2019 before the judge was elevated to the Court of Appeal and the case file was reassigned to Justice Oshodi wherein he was re-arraigned on two counts of charge.

He also pleaded not guilty to the two counts and the prosecution commenced trial.

During the trial, the prosecution called four witnesses, among which, was the first survivor, the eight-year-old, the Investigative Police Officer (IPO), the defendant’s wife and mother of the survivors, and a medical doctor from Mirabel Centre.

In her testimony, the survivor identified the defendant as her father and narrated how she was repeatedly defiled by the father.

She further testified of informing her school teacher, who is close to her mother.

She told the court that she did not tell her mother because the defendant had warned and threatened that she would die if she did so.

In her testimony, the defendant’s wife narrated how she discovered that her two daughters were defiled when she took them to the hospital.

She described their house and noted they all sleep in a room, adding that their parlour is not attached to the room.

Under cross-examination, the survivor’s mother told the court that there was a night she met the defendant and her daughter in their parlour.

But the defendant told the court that his wife lied against him because he wanted to marry another wife and relocate her to the village.

However, Justice Oshodi in his judgment, yesterday, exonerated the defendant of the second charge.

The court held that the prosecution failed to prove the second charge against the defendant, as the second survivor did not testify to the second charge related to her defilement.

On count one, the court held that the testimony of the first survivor corroborated the medical doctor’s testimony.

The court said that he has considered the ingredients of the offences, the confessional statement, circumstantial evidence and the eyewitness account and therefore sentenced him to life imprisonment.

The judge also directed that his name be registered in the Sexual Offenders’ Register of Lagos State.

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BREAKING: Raymond Dokpesi DAAR Communication Founder is Dead




BREAKING: Raymond Dokpesi DAAR Communication Founder is Dead


The Chairman of DAAR Communications Ltd, High Chief Raymond Dokpesi, is dead.


He was aged 75. He was the founder of AIT/RAYPOWER, a leading media outfit in Nigeria. ROYAL NEWS reports that Dokpesi died on Monday in his Abuja residence.

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Peter Obi Discusses Attending Tinubu’s Inauguration and Proposed Protest




Peter Obi calls for calm after being spotted at Asaba Airport on Tuesday after Saturday’s presidential election

Peter Obi Discusses Attending Tinubu’s Inauguration and Proposed Protest

The presidential candidate of the Labour Party (LP) in the 2023 election, Peter Obi, has said he would not be attending the swearing-in ceremony of the President-elect, Asiwaju Bola Tinubu.

The former Governor of Lagos State would be sworn in as the 16th democratically elected President of the Federal Republic of Nigeria today at Eagle Square in Abuja.

Speaking to reporters in Abuja through his media aide, Tai Obasi, the LP flagbearer said it will be ‘extremely weird’ of him to attend Tinubu’s swearing-in when he is challenging his electoral victory in court.

Obasi noted that even though his principal is a very humble and reasonable man who is always looking for peace and unity in the country at all costs, he cannot act that weird and unreasonable.

The media aide, however, failed to confirm if the Labour Party leadership and Obi were sent individual invitations to the swearing-in ceremony.

He said, “My principal is a very humble and reasonable man who is always looking for peace and unity in the country at all costs. But it will be extremely weird for him to attend a ceremony of a man whose election victory he is challenging in court.

“My principal cannot act that weird and unreasonable. I can’t confirm if he receives an invitation to the swearing-in ceremony. But I am telling you that you can’t see him there.”

Speaking further, Obasi also denied rumuors that the former Anambra State governor is planning a demonstration ahead of today’s inauguration.

He said, “I don’t know where that report is coming from. We don’t know anything about it or who is behind the proposed protest. But I can categorically tell you that my principal is not aware of anything.

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“He is Obi and his followers are Obidient. I agree that on some occasions, they may act on their own, no matter how you tell them to keep calm. These guys are angry. They are not happy about how everything was manipulated against Obi who has given them so much hope. They followed him and waited for him all the way.”

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