Why CBN Act Should Not Be Amended -Moghalu

Why CBN Act Should Not Be Amended -Moghalu

Kingsley Moghalu, a former Deputy Governor of the Central Bank of Nigeria (CBN), has expressed conviction that should the National Assembly successfully pass a bill to amend the apex bank’s Act, its institutional independence would be taken away.

Moghalu gave the warning just as a bill that seeks to remove the governor of CBN as chairman of its board, scaled second reading at the Senate.

Sponsored by Sadiq Suleiman Umar (APC, Kwara North), the bill seeks to amend the CBN Act to enable the appointment of a person other than the Governor as the chairman of its board.

The bill would also divest the board of the powers of determining and fixing salaries and allowances of its members and considering and approving the bank’s annual budget of the bank.

It is noteworthy to state that the CBN Act No. 7 of 2007 currently allows any incumbent governor of the bank to also serve as chairman of its board.

Reacting to the passing of the bill at the Senate, Moghalu said the move was wrongheaded and should be dropped.

“The effort by some members of the National Assembly to pass a Bill removing the Governor of the Central Bank of Nigeria as Chairman of the Board of Directors of the CBN, and to remove the power of the Board to fix the Bank’s budget and set the salaries of its staff is completely wrongheaded and should be dropped,” he said. 

“Such an amendment to the CBN Act of 2007 would finally destroy the institution by disrobing it completely of its institutional independence as enshrined in the Act.

“It would make the bank, a statutory corporation under the law, to become a Ministry or a mere Agency or Department of the Government. And it would render the bank an open playground for politicians who are the custodians of our dysfunctional governance. 

“Granted, the CBN has already been politicised since mid-2014 when its current governor was appointed. But that is a function of incompetent, selfish political and institutional leadership, not a de jure legal reality.” 

According to Moghalu, the proposed bill, if passed, would legalise an abnormality and worsen it.

Leave a Reply