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By: Inokotong and Sunday Ejike | Abuja
THE Supreme Court on Friday nullified the Federal Government’s cashless and naira redesign policy, declaring it as an affront to the 1999 Constitution.
It also held that Presi- dent Muhammadu Buhari breached the constitution in the manner he issued directives for the redesigning of the banknotes by the CBN.
The apex court also held that unlawful use of executive powers by the president inflicted unprecedented economic hardship on the citizens by denying them ownership of, and access to, their money.
The court, in a unanimous judgment delivered by Justice Emmanuel Agim on behalf of the seven-member panel of Justices of the court, voided and set aside all the directives issued by President Buhari in respect of the naira redesign and circulation on the grounds of illegalities and abuse of executive powers.
The court held that the president ought to have put in place adequate provisions before giving the directives for the change of currency and added that the demonisation directive of the president is not consistent with the provisions of the law.
The apex court took a swipe at President Buhari for disobeying its interim order of February 8 to the effect that the old naira notes
of N200, N500 and N1,000 denominations be allowed to be in circulation.
Justice Agim held that the president exhibited and took the disobedience to the highest peak with his broadcast of February 16 in which he allowed the N200 notes alone.
The court held that the rule of law, which the democracy of the country is founded on, would become a misery if the president refused to obey the order of the court.
Sixteen state governments had challenged the Federal Government at the apex court on the controversial naira redesign and cashless policy.
The sixteen states, led by Kaduna, Kogi and Zamfara, prayed the apex court to void and set aside the policy on the grounds that it was inflicting hardship on Nigerians.
They accused Buhari of usurping the function of the CBN in the introduction and implementation of the policy and asked that the directive issued by the president be voided.
On its part, the Federal Government challenged the jurisdiction of the apex court on the grounds that the CBN was not joined as a party and that the dispute on the policy ought to be directed at the CBN so that the suit could be referred to the Federal High Court.
In the unanimous judgment, the apex court dis- missed the preliminary objection raised by the defendants against the suit of the plaintiffs.
According to Justice Agim, the directive of the president to the CBN on the amount of money for withdrawal by individuals and corporate organisations is invalid.
The court held that the president acted ultra vires by his glaring failure to consult with the National Council of State, Federal Executive Council (FEC) and the National Economic Council (NEC) before directing the CBN to unlawfully introduce new naira notes.
The court held that the unconstitutional use of powers by President Buhari on the naira redesign breached the fundamental rights of Nigerians in various ways.
It said such use of powers by President Buhari is not permitted under democracy and in a pluralistic society like Nigeria.
Meanwhile, economists have commended Friday’s Supreme Court judgment which held that the old N200, N500 and N1,000 notes remain legal tenders along with the new notes until December 31, 2023.
The apex court had ordered the Central Bank of Nigeria (CBN) to allow the old and new banknotes to circulate side by side till the end of the year.
Economists said a compliance with the judgment would help revive economic activities and reduce the difficulties being experienced by Nigerians on account of the Federal Government’s policy.
The economists pointed out that the period between now and December 31 provides an opportunity for the CBN to reassess the policy and improve on its implementation without causing distortions to the economy.
An economist, Uche Uwaleke, a professor of Capital Market at the Nasarawa State University, Keffi, said: “I advise the CBN to comply with the ruling since it has come from the final court in the land. Doing so will help revive economic activities and reduce the difficulties currently being experienced by Nigerians on account of the policy.
“Be that as it may, it is important to recognise that the CBN has recorded some achievements in terms of the objectives it set out to achieve. The reduction in huge cash circulating outside the commercial banks, the surge in electronic transactions and increase in financial inclusion are part of the achievements recorded thus far.
“The time frame till Dec 31, 2023 provides an opportunity for the CBN to reassess the policy and improve on its implementation without causing distortions to the economy.”
For Aliyu Ilias, a financial analyst, “the Central Bank of Nigeria (CBN) will not release the old notes again; the only thing is that it will be easier for people that still have the old money to spend it.”
Ilias said: “The fact remains that the Supreme Court has just eased the situation economically. Hearing it alone is going to ease a lot of tension in the economy, and businesses that have lost a lot will be gladdened by this ruling. Now that we have heard this, I think everything will begin to fall into place. Things will adjust to normal as expected.”
Political economist, Adefolarin Olamilekan, said: “Chiefly, the ruling is a saving grace for Nigerians and businesses. The ruling is nothing but a welcome development.
“Critically, the naira redesign monetary policy implementation has impacted the economy negatively. Let us not forget that the objective of the policy is laudable but its implementation has reversed the benefits to the nation’s economy. This is even more so as the Small and Medium Enterprises (SMEs) and majority of the informal sector actors are struggling under the weight of naira scarcity and discour- aging online bank transfers courtesy of poor internet service. The ruling is welcome. It is a good tiding towards better deals in our economic policy.”
On whether the CBN will release the old naira notes back into circulation, Olamilekan said: “We are hopeful this will follow, particularly as the new notes are not readily in the system. The interpretation of the rul- ing is the availability of naira notes, with emphasis on the old naira notes, to Nigerians. This expectedly means a co- existence and availability of the old and new naira notes in the system.
“Significantly also, it will be a relief if both old and new notes are made available even as the CBN claimed it had destroyed the old notes it mopped up.
“However, a lot of Nigerians are still with the old notes. This is definitely a welcome ruling that would enable many to bring out the old notes for spending. More so, in some states, the old notes were still being used for transactions before this ruling.
“The Supreme Court has rescued the economy from further danger and eroded the suffering millions of Nigerians are facing.
“We, however, hope that the Federal Government would abide by the Supreme Court ruling as means of dousing the pressure on the economy, as the policy has reduced household consumption, stunted business expansion and reduced our Gross Domestic Product (GDP).
“Again, we expect the CBN and banks to strengthen the internet banking struc- ture. This would deepen the smooth operation of the cashless policy and reduce the risk in online banking architecture.
“Further, the government must find a way to always carry the people along, no matter the policy, as this policy affects the generality of the population.
“Businesses in the formal and informal sectors must embrace and recalibrate their services in full imple- mentation of the cashless policy.”
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