THE Governor of the Central Bank of Nigeria, Malam Lamido Sanusi, stirred another round of controversies on Thursday, August 23, 2012 when he announced the bank's intention to introduce a mega-value N5,000 currency note in addition to large-scale redesigning and restructuring of our currencies.
According to Sanusi, come some time early next year, in addition to the new N5,000 note, the existing N50, N100, N200, N500 and N1,000 notes "will be redesigned with added new security features" with improved security features which will make them more user-friendly to visually-impaired persons, while the lower denominations will be turned into coins.
According to him, the N5,000 note will be used to honour the contributions of women to the struggle for Nigeria's independence; our founding mothers, foremost of whom are Margaret Ekpo, Funmilayo Ransome-Kuti and Gambo Sawaba.
There have been uproarious protests, especially from the opposition political parties such as the Action Congress of Nigeria (ACN), the Congress for Progressive Change (CPC) and other members of the public, including economists. They are worried that the new N5,000 note will worsen the inflationary rate, exacerbate the already endemic corruption in the system and generally negate the noble objective of the "Cashless Policy", which is still struggling for acceptance in its experimental stage.
The critics also posit that reintroducing coins which have proved no longer popular in Nigeria might simply force market retailers to peg N50 as the lowest acceptable legal tender.
Out of concern over the chaotic situation this has created, the Senate has stepped in, ordering the CBN to suspend action until a proper parliamentary inquest is conducted into it.
The Chairman of the Senate Committee on Banking, Insurance and other Financial Institutions, Senator Bassey Edet Otu, said there was a need for parliament's approval of the project before it can go forward due to "the numerous fiscal implications on the entire economy."
We support this move by the Senate in its entirety.
Even though the CBN has wide ranging powers to regulate monetary issues, including currency administration, it is important for it to carry Nigerians along with it to avoid the confusion and complaints of impunity that trailed earlier CBN interventions, particularly the take-over of ailing banks and unexplained sourcing of N620 billion to bolster them up in the process of turning them into "bridge banks".
Power given to institutions of government is for the benefit of Nigerians and not to be wielded for its own sake. Nigerians must be allowed to participate in the public hearing that will ensue in the Senate and House of Reps, when this matter is considered to determine if we really need it, some of it or none of it.