MPs clash with CBK Governor over inflation

By David Ochami

Members of Parliament clashed with Central Bank Governor Njuguna Ndung’u, accusing him of arrogance and refusing to state the causes of inflation and free fall of the shilling.

Prof Ndung’u, who tried to have journalists thrown out of his cross-examination by the House select committee chaired by Wajir West MP Adan Keynan who were interrogating him over the matter, had his request rejected.

MPs accused him of failing to predict and plan for the deterioration of the shilling and inflation and allowing it to decline for two months before intervening.

Prof Ndung’u (left) addresses the Parliamentary Finance Committee at Continental House, Nairobi. Looking on is his deputy, Heron Sirima. [PHOTO: JONAH ONYANGO/STANDARD]

At the same time, Ndung’u also refused to name commercial banks believed to hoard foreign currency leading to an artificial shortage.

Not impressed

And the policy measures he claimed CBK had imposed to restore stability in the money markets and arrest the decline of the shilling did not impress the MPs.

The legislators instead accused him of being too long on academic lectures but short on concrete and tangible results to address an urgent problem.

At one time, Ndung’u was forced to apologise to Yatta MP Charles Kilonzo for suggesting the legislator should meet him for a private discussion and receive a book on these matters.

"This is what we call arrogance," declared Isiolo South MP Abdul Bahari after the governor’s suggestion.

Mr Bahari accused the governor of belittling MPs and the matter at hand by inviting Kilonzo for a private discussion yet "he has been called here to address the nation".

Ndung’u said local production declined, affecting economic recovery, triggering a rise in commodity prices and inflation, when fuel prices soared.