One of the revelations at the Janneh Commission about the former president and his government’s dealings with the Central Bank and Public Corporations/Companies was the circumvention of the procedures relating to removal of state funds lodge at the Central Bank. Testimonies at the commission showed that in some instances a telephone call or a small sheet of paper was sufficient enough to release millions of Dollars and Dalasi from the Central Bank, disregarding the stringent procedures espoused in the Central Bank Act. Equally, the former executive had unilaterally and willingly bailed out certain public corporations like NAWEC which have eventually made the Government of The Gambia a public debtor.
The recent announcement by the government that the National Food Security Corporation (formerly GGC) will be receiving some D396 million through the Central Bank of The Gambia for the immediate purchase of groundnuts from farmers. On a face value, this decision is laudable as it provides remedy to farmers who have sold their nuts and were only given promissory notes. There couldn’t be a better news to farmers than the government’s communication on this decision. But my concern is the paucity of facts on the relationship of the three parties (government, central bank and NFSC) in the disbursement of such a huge sum of money in the communication. It’s not known to the public whether the money is coming from a special fund lodged at the CB; whether is from the Consolidated fund in which case, it should have been appropriated by an Act and earlier tabled before the NA; and whether it’s a loan to the Government pursuant to s. 32 (temporary advances) of the Central Bank Act. If it is a loan to the government by the CB, the Bank must observed its law that the said loan together with advances, purchase of treasury bills and securities to government “shall not exceed ten percent of the tax revenue of the previous fiscal year” (s. 32(2)).
If the D396 million given to NFSC is a loan to government, then what were the terms and conditions of the loan and repayment from NFSC, the ultimate utilizer of the loan. Why will government contract such a huge loan on behalf of a public corporation incorporated to trade and make profit? If the loan is to NFSC, which was incorporated to, among other objects, undertake groundnuts financing, then conditions in s.59(h) and (i) of the CB Act.
I hope that the current government and current management of the CB will not disregard the law and procedure relating to disbursement and management of public funds. These are my concerns!