Nigeria’s Reps push a bold CBN reform bill to boost accountability, separate powers, and modernise oversight of monetary policy

House Leader Prof Julius Ihonvbere and Lagos lawmaker Jesse Onakalausi on Thursday led a decisive legislative move in Abuja as the House of Representatives advanced the CBN reform bill through second reading, marking a major step toward overhauling the Central Bank of Nigeria’s governance framework.

Also read: Reps push bold reform bill to strengthen CBN oversight

The proposal, formally titled the CBN reform bill, received unanimous support during plenary.

The bill seeks comprehensive amendments to the Central Bank of Nigeria Act, 1991, responding to mounting public concern over transparency lapses, governance gaps, and recent controversies involving monetary policy decisions, foreign exchange management and the 2022 currency redesign.

Onakalausi told lawmakers that the reforms were driven by an urgent need to reinforce autonomy, accountability and operational clarity at the apex bank.

He emphasised that the CBN plays a pivotal role in stabilising the financial system, safeguarding price stability and maintaining public confidence.

He argued that recent events had revealed structural weaknesses that demanded immediate correction.

Analysts have long criticised the concentration of power in the office of the CBN Governor, noting that the current law merges executive and oversight roles in a manner that undermines corporate governance.

Onakalausi said the bill separates the positions of Governor and Board Chairman to restore institutional balance and prevent conflicts of interest.

He added that the proposed amendments would modernise the Monetary Policy Committee by improving expertise, independence and transparency, aligning Nigeria with global practices in the United Kingdom, South Africa, the European Union and Brazil.

He highlighted that Ways and Means advances historically prone to misuse would be limited to 10 per cent of the previous year’s actual revenue to curb inflationary financing of government deficits.

The draft legislation also introduces stronger safeguards for the naira and clearer rules for foreign exchange management.

It mandates a 90-day notice period, impact assessments and National Assembly briefings before major monetary decisions such as currency redesign or demonetisation, ensuring that disruptive policy shocks are avoided.

Under new reporting standards, the central bank would be required to submit annual audited accounts within two months and publish quarterly reports on monetary policy decisions.

It must also maintain a publicly accessible repository of all its publications.

Key amendments would create a professional Chair of the Board, separate from the Governor, while the Governor and Deputy Governors would serve a single six-year term.

Two Deputy Governors must come from internal directors to promote continuity.

The reconstituted Monetary Policy Committee would include the Governor, four Deputy Governors, two board members and four external experts barred from holding public office.

If enacted, the reforms would represent one of the most far-reaching transformations of the CBN Act since 1991, with significant implications for governance, monetary policy and the broader financial system.