Sanusi's suspension: Matters arising - The Sun
The suspension of Mallam Sanusi Lamido Sanusi as Governor of the Central Bank of Nigeria (CBN) on February 20 over allegations of serious financial infractions has expectedly been generating ripples from all over the country. Among the issues raised by President Goodluck Jonathan's decision to suspend him from office are the legality or otherwise of the action and its impact on the economy.
Sanusi, who had barely four months to the expiration of his tenure, has since gone to court to challenge this sanction.The letter of his suspension signed by the Secretary to the Government of the Federation, Anyim Pius Anyim, which detailed the particulars of the alleged infractions, was said to have been the outcome of a report of the Financial Reporting Council of Nigeria (FRCN) on the Audited Financial Statements of the CBN for the year ended 31st December, 2012.
Highlights of the alleged infractions include the 'persistent refusal and/or neglience' of Sanusi to comply with the provisions of the Public Procurement Act in the procurement practices of the apex bank such as goods, works and services running into several billions of naira. The government also alleged in the suspension letter that under the leadership of Sanusi, CBN was unable to prepare its financial statements based on International Financial Reporting Standards (IFRS), whereas commercial banks under the supervision of CBN had complied since 2012. Other infractions allegedly committed by Sanusi include N3.086bn 'promotional activities' in 2012 (up from N1.08bn in 2011), and another N20.202bn on 'legal and professional fees in 2011.These expenses, government said, were 'beyond all reasonable standards of prudence and accountability'. There were, as well, other expenses reportedly made on 'private guards' and 'lunch for policemen' for which CBN, under Sanusi, claimed to have spent the sum of N1.257bn in 2012. These allegations, if proved to be true, are grave indeed.
Coming against the background of Sanusi's allegation of non-remittance of about $20bn to the Federation Account by the Nigerian National Petroleum Corporation (NNPC), which has generated a huge national debate in recent months, these fresh allegations against the now suspended CBN helmsman paint a sorry picture of the magnitude of the mismanagement of public funds in the country.
Beyond the matter of the legality or otherwise of this suspension, government must not foreclose comprehensive investigation of all the weighty allegations of financial wrongdoing at both the NNPC and the CBN. Only a thorough and impassioned probe that is devoid of malice or a witch-hunt will do.
On the power or otherwise of the president to suspend Sanusi, the laws relating to the appointment to the position of the CBN governor, in particular, Section 8 (1) of the CBN Act of 2007, which gives the President the power to appoint a Governor of CBN and Deputy Governors, appear instructive.
Specifically, and very germane to the suspension of Sanusi, is Section 11(1) paragraph b of the same Act, which gives the president the power to suspend the helmsman of the apex bank on grounds of serious misconduct, as well as Section 11(1) paragraph b of the Interpretation Act, which says that any person who is given the power to appoint any official also has the power to suspend. The law, in this case, is fluid and the aforementioned laws make meaning when the paragraphs are read disjointively or independent of each other.
Nevertheless, it is expedient that Sanusi has gone to court to determine the legality or otherwise of the president's action in suspending him. The pronouncement of the court on the matter will go a long way in educating Nigerians on the contending claims and rest the controversy once and for all.
Beyond these, however, it is necessary for the government to handle Sanusi's suspension and the succession process at CBN with utmost discretion to avoid any negative impact on the economy. The international community and our foreign investors are keenly watching as the post-Sanusi era unfolds. Undoubtedly, the post of CBN Governor is critical. The occupant of the office wields unrivaled power and influence over monetary policy as he sets short-term interest rates and designs strategies on jobs, savings, inflation and the present and future of the economy of the country.
It is rather unfortunate that Sanusi's tenure was characterised by controversies. He, clearly, talked much more than was expected of his high office. The popular view is that he unnecessarily politicised an otherwise conservative office and focused a lot on activities that were not part of his core mandate.
All these are lessons that his successor must learn from. The next CBN governor will need creative leadership ability that could inspire confidence in the economy. Because banking at any level is essentially a confidence game, any crisis of confidence can have a domino effect on the economy. We cannot afford any instability at the Central Bank.