Every Nigerian knows that the Governor of Central Bank of Nigeria (CBN) Malam Sanusi Lamido Sanusi, is passing through a difficult phase in his career.
Since his appointment in June 2009, Sanusi has had his way in implementing virtually every policy he pursued. But things seem to have changed, following his announcement of a controversial decision to introduce a N5,000 note into circulation early next year, as part of a comprehensive currency restructuring in which lower naira denominations will become coins.
Sanusi, who made the announcement on August 23, 2012, said the front page of the new highest denomination would be adorned with the images of the late Margaret Ekpo, Funmilayo Kuti and Hajiya Gambo Sawaba, while the backside would have the National Assembly structure.
He also stated that the existing N50, N100, N200, N500 and N1000 notes would be redesigned with new security features added. The were to be launched at the same time. He added that President Goodluck Jonathan had approved the new currency series together with the N20, N10 and N5 notes to be changed to coins and used as legal tenders along with the existing coins of 50k, N1 and N2.
This famous announcement, expected to attract commendations, became a contentious issue as it was roundly condemned by virtually all segments of the Nigerian society, including the National Assembly.
Former President Olusegun Obasanjo, many eminent Nigerians, the Nigeria Bar Association (NBA), civil society groups, religious bodies and families of one of the national female icons to be adorned on the note Funmilayo Kuti were among those who opposed the plan. Most economic pundits expressed fears that the introduction of N5000 note may aid corruption, encourage more spending, spur inflation negate CBN's newly introduced cashless policy.
Members of the National Assembly were on their annual recess when the CBN announced the plan. But relevant committees from both the Senate and the House of Representatives cautioned the CBN over the move.
But as soon as the National Assembly resumed proceedings last Tuesday, both chambers asked President Jonathan and the CBN to stop action on the issuance of the proposed N5000 note.
The federal lawmakers said the views expressed by many economists indicates that the policy would cause inflation, reduce purchasing power, lead to currency devaluation and widen the gap between the rich and poor.
Adopting a motion of urgent national importance moved by the chairman of the Senate Committee on Rules and Business, Senator Ita Solomon Enang (PDP, Akwa Ibom North-East), the Senate said the CBN governor was leading President Jonathan astray by proposing such a policy.
Senate President David Mark said the Federal Government should be humble enough to reverse its decision, since Nigerians were against it.
"The wishes of the people should be considered before any policy is put in place. The important thing is that if Nigerians say they don't want a particular policy at any given moment, there is no harm in the government retracting its stand on it.
"I have listened to the arguments of those supporting it but those arguments are simply not convincing as they appear to be highly theoretical and technical in nature and do not address any practical issue on ground. Any policy that does not address issues directly but just talks about indices we cannot verify for now should wait," Mark said.
He observed that from the contributions on the floor of the Senate, it was clear that the timing was wrong and the policy was unnecessary, stressing that 'there is no ambiguity on our stand on the issue'.
He pointed out that if Sanusi was aware of the provision of the constitution, he would have made reference to the National Assembly before addressing the public on the matter.
The Deputy Senate President, Ike Ekweremadu, said the government would be heading for a disaster if it failed to listen to Nigerians 'whose representatives have spoken here today'.
Earlier in his lead debate, Senator Enang said apart from creating multiple economic problems, such as inflation, corruption and security challenges, the policy would devalue the nation's currency and ruin the economy.
The Chairman of the Senate Committee on Finance, Senator Ahmed Mohammed Makarfi (PDP, Kaduna North) said the CBN had insulted Nigerians for saying that the proposed N5000 note was meant for a class of people.
Also, at the House of Representatives, members unanimously voted against the move when they adopted a motion sponsored by Rep Albert Sam-Tsokwa (PDP, Taraba) and 20 others.
The House further directed its committee on Banking and Currency to investigate the planned restructuring and report back in four weeks. Sanusi is expected to appear before the committee tomorrow (Monday).
In the same vein, the Committee on Banking was further asked to commence urgent process of amending the CBN Act with a view to making it mandatory for the National Assembly to have inputs into the introduction and or restructuring of the nation's currency in the future.
Leading the debate on the motion, Rep Tsokwa argued that the apex bank governor's statement that there was no going back on the planned restructuring was tantamount to the use of absolute power, and a policy somersault against its planned cashless economy.
He said even developed economies had maintained moderate value currency denominations for a long time, citing the example of the US's withdrawal of $500, $1,000 and $5,000 from circulation, based on their negative impact on the nation's economy after they were experimented with.
"Views expressed by some economists and other professionals indicate that the policy will cause hyper-inflation, reduce purchasing power, cause currency devaluation and widen the gap between the rich and the poor,"he said.
The Minority Leader Rep Femi Gbajabiamila (ACN, Lagos) said the CBN had been given unlimited powers, unlike in America and faulted the approval given to the policy by the Economic Management Team (EMT).
Few hours after the resolutions were passed, President Jonathan called an emergency meeting at the Presidential Villa with the leadership of the National Assembly over the matter, where he agreed to stop the move by the CBN to introduce N5000 notes and restructure lower denominations, as exclusively reported by Daily Trust.
The meeting, attended by Senate President Mark and Speaker Aminu Waziri Tambuwal, was held late in the night of last Tuesday.
"The President told them (Mark and Tambuwal) that he would ask the CBN governor to halt the decision in line with the resolutions of the legislature. According to the third schedule of the 1999 constitution as amended, any resolution that is passed by any chamber and concurred to by the other is binding on the executive to implement as it carries the force of law like an Act of parliament. Therefore, neither the President nor the CBN governor can refuse to abide by the resolutions as passed on Tuesday," the source said.
The suspension of the introduction of the N5000 note was, however, confirmed by the presidential spokesman, Dr Reuben Abati, when he said "the introduction is being suspended for now to enable the CBN do more enlightenment on the issue.
"President Jonathan has directed that the implementation of the new N5,000 note be suspended for now. This is to enable the apex bank to do more in terms of making Nigerians understand why it proposed it in the first place. So, for now, the full implementation is on hold."
Before last Tuesday, the Federal Government had stood its ground to support the bid by the CBN to introduce N5000 notes and convert the N5, N10 and N20 notes to coins.