The national assembly on Wednesday passed a bill to raise the percentage of Ways and Means loans the Central Bank of Nigeria can give to the Federal Government.
The senate increased the amount of credit the federal government may get from the apex bank from 5% to 10% of its annual revenue.
Senate Leader Opeyemi Bamidele explained the rationale behind the increase, saying “The executive bill is to enable the Federal Government to meet its immediate and future obligations due to the government’s increasing needs for funds to finance the budget deficits and other expenses.”
The Ways and Means facility allows the apex bank to provide short-term financing to the Federal Government to tackle budget deficit.
“The loans will enable the provision of immediate funds to address budget shortfalls and finance essential government expenditures as well as help maintain financial market stability by preventing government default on its obligation,” Bamidele added.
Bamidele and his colleagues contended that a margin of increase ranging from 5% to 10% is appropriate.
They claimed that even while the increase is required for economic growth, capital projects should be properly monitored to make sure the money is only allocated to legacy and infrastructure projects.
The executive bill passed its third reading after being discussed in the Committee of the Whole.
The House of Representatives raised Ways and Means from 5% to 10% in the CBN Act amendment, just like the Senate
President Bola Tinubu is expected to sign the amended bill into law in the coming weeks.
The highly contentious Ways and Means advance has been subject to all kinds of misappropriation.
The Senate granted the former President’s request to restructure the N22.7 trillion in loans that the Central Bank of Nigeria (CBN) had given to the Federal Government under the terms of its Ways and Means provision in May 2023, just before the end of Buhari administration
