Bill seeks stronger checks and balances, limits on Ways and Means, new MPC structure and stricter reporting standards.
The House of Representatives on Thursday began legislative moves to tighten accountability within the Central Bank of Nigeria, following the second reading of a bill proposing a far-reaching amendment of the Central Bank of Nigeria Act, 1991.
The bill, sponsored by House Leader Julius Ihonvbere and Lagos lawmaker Jesse Onakalausi, sailed through second reading with unanimous support from lawmakers.
Titled “A Bill for an Act to Amend the Central Bank of Nigeria Act, 1991, to allow for proper day-to-day operations, professional oversight and enhance checks and balances, and for other matters connected thereto, 2025,” the proposed legislation responds to mounting concerns over governance lapses at the apex bank. Those concerns intensified after recent controversies involving monetary policy decisions, foreign exchange management, and the troubled 2022 currency redesign exercise.
For years, analysts have criticised Nigeria’s central banking framework for concentrating excessive operational and supervisory powers in the hands of the CBN Governor. They argue that this structural fusion enabled opacity in policymaking, inconsistencies in FX administration and unchecked use of Ways and Means financing concerns that have now set the stage for renewed legislative scrutiny.
Explaining the rationale behind the bill, co-sponsor Onakalausi said the reforms are necessary to strengthen governance, autonomy and transparency at the apex bank, given recent domestic and global economic realities.
While introducing the general principles of the amendment, he stressed the pivotal role of the central bank in ensuring monetary stability and safeguarding public confidence. However, he added that recent events have exposed significant weaknesses in the law.
“Developments in recent years from governance concerns, foreign exchange distortions and inconsistent monetary policy, to weak oversight and the issues surrounding currency redesign have revealed structural gaps in the current Act,” he said.
A major component of the amendment seeks to overhaul corporate governance at the CBN. Onakalausi argued that in most advanced jurisdictions, the Governor handles daily management while a separate Board provides oversight, an arrangement that prevents conflicts of interest.
He noted that Nigeria’s current Act merges the positions of Governor and Board Chairman, creating what he described as an unnecessary concentration of power. The new bill proposes separating these roles to allow for independent, professional oversight without disrupting daily operations.
The legislation also targets stronger monetary policy independence and alignment with global standards. According to the sponsors, the Monetary Policy Committee will be restructured to improve expertise and transparency, reflecting models used in the UK, South Africa, the EU and Brazil.
Another major reform addresses long-standing concerns around Ways and Means financing. The bill proposes a clear limit of 10 per cent of the previous year’s actual revenue to curb the historical misuse of the facility and minimise inflationary deficit financing.
Additional provisions focus on strengthening foreign exchange transparency and safeguarding the naira. The draft introduces a 90-day notice period, mandatory impact assessments, and compulsory National Assembly briefings before any major monetary action such as currency redesign or demonetisation, to prevent disruptive policy shocks.
Though the sponsors affirm the need for central bank autonomy, they insist that such independence must come with robust oversight. Under the amendment, the CBN will be required to submit audited annual accounts within two months, issue quarterly reports on monetary decisions, and maintain an easily accessible online repository of all publications.
The bill also proposes key adjustments to the CBN leadership structure. Revised Section 6 states that the Board will be chaired by a “professional Chairman separate from the Governor,” with expertise in economics, banking, finance or public financial management. The bill also amends Section 8 to establish a single six-year term for the Governor and Deputy Governors.
To promote continuity and shield the institution from political pressure, at least two Deputy Governors must be selected from existing internal Directors.
Under the reconstituted Monetary Policy Committee, membership will include the Governor, four Deputy Governors, two board members, and four independent external experts who cannot hold public office.
If enacted, the amendment would constitute one of the most comprehensive reforms of the CBN Act since its inception, with far-reaching implications for governance, monetary policy conduct and Nigeria’s broader financial architecture.
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