Bank Crisis; Our Legislators are a joke

The performance of the “honourable members” of the House of Representatives Committee on Banking and Currency during their meeting with Lamido Saunsi in Abuja is a joke to say the least. You can read what happened here. It got to the point where Minority Leader, Ali Ndume, had to politely excuse members from the meeting. Why should they invite Lamido Sanusi for a rebuke if they are not ready to meet him; facts with facts, knowledge to knowledge; law with law?

After the Cairman of the Committee, Ogbuefi Ozombagbachi denounced the Banks and Other Financial Institutions Act (BOFIA) enacted by the National Assembly as “invalid”, the minority leader of the Reps, Hon. Mohammed Ali Ndume, intervened: “We the leadership of the House of Reps  have had a protracted meeting with the CBN governor today and he said a lot of things to us. At this stage, I will like the Press and all those that are not with the CBN governor to leave this hall, please.”

Why do the Reps always prefer secrecy to openness? Why should they invite the Sanusi for a rebuke if they are not ready to meet him; facts with facts, knowledge to knowledge; law with law?

I always say these Reps inviting professional to defend their actions is always a joke! We witnessed the same episode under Soludo, Ndi-Onyiuke Okereke, etc

And now, the SUN reports that besides the shouting match between the ‘dis-honorable’ members and Sanusi, the session almost ended in scandal as the Chairman of the Committee, Hon. Ogbuefi Ozomgbachi’s speech was discovered to have been scribbled on the letter-head of Rockson Engineering, one of the organizations named in the CBN list of high profile debtors to one of the five banks.

SUN says: While waiting for Sanusi who was having a meeting with Speaker Dimeji Bankole, the chairman had read his address to members and the media. As soon as he finished reading the speech, he was approached by journalists to avail them copies, a request he immediately acceded to. However, in their bid to photocopy the speech, they were stunned to discover that the speech was written on official letter-head of Rockson Engineering, a firm in which Senator Aniete Okon, erstwhile national secretary of the Peoples Democratic Party (PDP) has substantial interest.

In my article, Nigerian Legislators: Lawmakers or Commonwealth Looters?

I said: Some of these legislators are not very vibrant in contributions to debates, motions and the sponsoring of bills. Some of them are semi illiterates; some are secondary school leavers and half baked diploma holders. Most of them cannot read and understand motions and bills. They cannot understand debates on the floor of House, so they feel inadequate in the chamber. So to keep away from embarrassment and inferiority complex, they don’t attend sittings. Debates are shallow, they are worse than beer parlour debates.

The social background of these members is another factor. Most of them are business men; car dealers, contractors, former drug pushers and 419ers, petty traders and hangers on of politicians, particularly governors. Their aim of coming to the House is simply to make money and increase capital. So, the National Assembly is seen as way of making fast and easy money; legislation is secondary.

Most of them see the National Assembly as a fashion centre, where they display their white gowns, cars and handsets. Many of them have turned legislation upside down. To cover their inadequacies, they go to their constituencies and start buying cars, motorcycles, fertilizer and distributing to the electorate, as well as painting class rooms etc. I know of a member who bought a jeep for a governor.

Some members have been in the National Assembly for about ten years now and they have never made contributions on the floor of the House. A large chunk of them, from 2003 to date, have not uttered the word “Mr Speaker“ on the floor of the House. They don’t attend sittings and they pay chamber attendants to write their names in the register.

Legislators from the Northern part of Nigeria are worse in this regard. The Daily Trust reported that Northerners have the highest number of truant legislators in the House of Representatives – In fact one Northern member’s last appearance in the House was on the inauguration day, two years ago.

They also engage in the criminal conduct of paying chamber attendants to sign the attendance register on their behalf. A negligible minority have ever sponsored or made meaningful contributions to any bills in the last two years.

SUN summaries the meeting of the Committee with Sanusi thus: In defending the injection of N420 billion to save five ailing banks by the apex bank, Sanusi told the committee that the action was not only within the statutory powers of the CBN Act, but that it was done to save the banks from imminent collapse.

The affected banks are Oceanic Bank, Afribank, Finbank, Union Bank and Intercontinental Bank.
But the committee would not agree with such an argument as it pointed straight to the CBN governor that no Acts was superior to the constitution of the Federal Republic.

According to the Chairman of the committee, Hon. Ogbuefi Ozomgbachi, no section of the constitution gave any backing to the steps taken by the CBN to save the banks.
“The CBN Act cannot supersede the constitution and therefore, any action taken pursuant to the CBN Act that is inconsistent with the provisions of the constitution is null and void and ineffectiveness and of no effect whatsoever,” he stated.

He added that even though the committee supported reform in the banking sector, Ozomgbachi said it must be done in a manner that it would not be injurious to depositors.
“This committee supports any measures which you have taken or will take to sanitize the banking system, in so far the measures are taken in conformity with the relevant laws of Nigeria,”
Sanusi replied that the lawmakers should take decisions based on what he will tell them and not what is reported on the pages of newspapers, more so that the steps taken had resulted in the recovery of N45 billion from loans advanced by the affected banks without following due process.
Besides, the CBN governor insisted that the money released to bail out the banks was a loan repayable and not expenditure.

 Disputing allegations that he contravened the 1999 Constitution, Sanusi reminded the committee that he only implemented the Act passed by the National Assembly.
“We did not spend money from the Consolidation Fund. The CBN Act was an Act of the National Assembly. It is the Act passed by the National Assembly that authorized me to move in and save the banks from collapse,” the CBN governor said.

He restated that government had no intention to nationalize the five banks or any other for that matter, noting that the intervention of the CBN was to resolve the immediate problems of liquidity challenges in the banking system so as to have a positive impact on the economy.
“The injection was done in the form of Tier 2 capital or subordinated capital, which is a form of lending and which constitutes an indebtedness by the deposit money banks (the borrowers).
“The indebtedness is to be repaid from the proceeds of capitalization or from other sources when the borrowing institutions eventually stabilize.

“Under the BOFIA, regulatory matters like minimum capital requirement, minimum holding of cash, capital adequacy ratio, are within the competence of the CBN to determine.”
Sanusi went ahead to quote relevant sections of the BOFIA Act, insisting that as a regulatory body, the apex bank can also excercise its powers of lenders of last resort in giving succour to a distressed bank.
“CBN has, therefore, not contravened any law, including the 1999 Constitution, in the manner it intervened to save the banks through the injection of fresh capital into their operations,” he told the committee.

Early this year, Nigeria President Umaru Yar’Adua scored the performance of the National Assembly at below average since he assumed office in 2007.