Senate investigates scarcity of smaller currency denominations

The Senate during a plenary

Queries Adeosun, Fashola over alleged diversion of $350m

The Senate yesterday mandated its committee on banking, insurance and other financial institutions to probe the scarcity of lower currency denominations in the country.The lower denominations in short supply are N5, N10, N20, N50, N100 and N200.The red chamber said the scarce denominations are critical to the economic development of the country essentially as it just exited from recession.

This resolution followed an adopted motion sponsored by Senator Peter Nwaobosi, who said most commercial banks explained why they no longer circulate the lower denominations because the Central Bank of Nigeria (CBN) has ceased to supply them.The lawmaker noted with concern that for the past one year, the CBN did not award contract for the printing of the lower currency notes.He further said,  “the lower denominations were printed and procured outside the country with the attendant economic and security implications.” 

However, CBN was asked to introduce the coins as an alternative to the lower notes for it was said to be more sustainable and have longer shelf life than currency notes.The Senate also on Tuesday subjected the Finance Minister, Kemi Adeosun and Minister of Power, Works and Housing Babatunde Raji Fashola to serious interrogations over their roles in the alleged diversion of $350 million.

But the Nigerian Sovereign Investment Authority (NSIA) currently managing the fund for the Nigerian Electricity Bulk Trading Company (NBET) said it has grown to $384 million.During a public investigative hearing organised yesterday by the senator Matthew Urhoghide-led committee on public accounts, Uche Orji also the Managing Director/Chief Executive Officer of the Authority affirmed that the fund was safe.

This amount is part of the $1 billion Eurobond facility obtained in 2013 but Adeosun and Fashola alternately told the committee that it was untrue that the said sum was diverted from the NSIA.The Senate, yesterday also expressed dismay over what it called fraudulent diversion of approved petroleum funds meant for the maintenance of federal roads across the country.

It announced that a comprehensive investigation would soon be conducted to find out why the portion of the petroleum funds as provided in the template of the Petroleum Products Pricing Regulatory Agency (PPPRA) was never released for road maintenance.The Senate committee on Federal Roads Maintenance Agency (FERMA), which made the disclosure at the National Assembly made it clear that operations of the agency had been frustrated because of lack of funds.

Chairman of the committee, Senator Magus Abbe, wondered how a law that was enacted to compel PPPRA to remit a certain percentage from the sale of each litre of fuel to the FERMA could be so brazingly ignored and sabotaged to pave way for the diversion of the fund to unknown accounts.  

Meanwhile, FERMA has revealed it is indebted to the tune of N15 billion to contractors.Acting Managing Director of FERMA, Nurudeen Rafindadi, who made this known at the budget defence session with the committee, said the agency’s debt profile is preventing it from paying its contractors.He said: “FERMA’s debt profile is huge and there will be need to settle outstanding debt in order to encourage contractors back to site.”

In another development, the upper chamber also urged the Federal Government to ban the importation of palm oil and kernel and fund the ministry of agriculture to boost large-scale production of the cash crop.It, therefore, mandated its committee on agriculture and rural development to summon the Nigerian Institute for Palm oil Research (NIFOR) to explain why it could not deliver on its mandate.

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Peter NwaobosiSenate
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