EXCLUSIVE: Senate probe in limbo as documents show ways and means was N7.5trn — NOT N30trn — under Buhari

 

Ways and means advances by the Central Bank of Nigeria (CBN) to the administration of President Muhammadu Buhari amounted to N7.5 trillion as at December 2022, according to official documents seen by TheCable.

This is significantly lower than the N30 trillion reported by the senate joint committee on banking, finance, national planning, agriculture and appropriation which led to the setting up of a probe panel headed by Isah Jibrin (Kogi east).

Ways and means is a loan facility through which the CBN finances the federal government’s budget shortfalls.

The CBN law limits advances under ways and means to 5 per cent of the previous year’s revenue, but this has been observed mostly in the breach over the years.

This way of financing government deficits usually results in macroeconomic instability, leading to inflation and high exchange rates because of the excess liquidity injected into the economy.

THE BREAKDOWN

Documents seen by TheCable show that as at December 19, 2022, the total outstanding overdraft to the federal government in its “treasury subtreasury account” at the CBN was N22,719,703,774,306.90.

This was made up of N7,531,819,048,929.66 as ways and means, N13,725,408,432,557.50 as total costs of transactions on federal government securities in the capital market, and N4,618,829,652,047.41 as interest charges on the overdraft facility.

The loans were not reflected as part of the debt stock of the federal government until December 2022 when the Buhari administration officially requested the national assembly to do so.

TheCable understands that there were only three requests for ways and means by Buhari throughout his tenure, even though the facility was disbursed more than thrice — some automated because of the sovereign risk on securities.

The biggest amount — nearly N2 trillion — was disbursed in 2020 during the COVID-19 outbreak when government revenues fell as a result of the lockdown. The federal government got loans from the CBN for intervention programmes during .