Governors of the states of Nigeria under the umbrella of Nigerian Governors Forum (NGF) have again resisted attempts to begin the deduction of the Paris Club’s refund of $418 million allegedly due to four contractors from the federation’s account.
The governors in a letter to the federal government through the Secretary of Government of the Federation (SGF), Boss Mustapha, argued that an attempt to restart the deduction process, which is being challenged in court and for which the Supreme Court has pronouncement made, it would be unconstitutional.
The letter, signed by NGF chairman and outgoing Ekiti state governor Kayode Fayemi, described the new move as an “attempt by the Attorney General of the Federation (AGF) and the Minister of Finance (HMF) to circumvent the law. . and the recent ruling by the Supreme Court in surreptitiously obtaining FEC approval to make a $418 million payment to four contractors who allegedly executed contracts in respect of Paris Club reimbursements to states and local governments.”
The approval of President Muhammadu Buhari under the instrumentation of the AGF, Abubakar Malami, and the Minister of Finance, Zainab Ahmed, to pay said sum to the contractors through the issuance of promissory notes, encountered strong resistance from the governors of the 36 states that they approached the court to obtain redress through their Attorneys General.
Pending business
The governors argued that the matter is currently pending appeal at the Abuja Court of Appeal for hearing, adding that the Nigerian government should exercise restraint in handling the matter.
“Significantly, while that appeal is pending, one of the contractors, who is beneficiary of the Notes in the amount of $142,028,941.95, Riok Nigeria Limited and who had lost in the Court of Appeal, appealed again to the SC in SUIT NO: SC 337/2018 BETWEEN: RIOK NIGERIA LIMITED V INCORPORATED TRUSTEES OF THE NIGERIA GOVERNORS FORUM AND 7 ORS. The Supreme Court on June 3, 2022 also dismissed Riok’s appeal as unfounded,” the NGF said.
The governors argued that the Supreme Court had made it clear at the time that neither the NGF nor ALGON had the power to award contracts and charge them directly to the Federation Account as was done in this case.
“The dismissal of the RIOK case by the SC also affected the payment of $1,219,440.45 and $215,195.36 to two private attorneys of RIOK, NWAFOR ORIZU and OLAITAN BELLO, who are also beneficiaries of Promissory Notes by the DMO ”, says the letter.
“In addition to RIOK and the two attorneys, the States have also challenged, either on appeal or in other courts, the claims of the other contractors, including: DR. TED ISIGHOHI EDWARDS ($159,000,000), NED NWOKO ($68,658,192.83), and PANIC ALERT SECURITY SYSTEMS LTD ($47,831,920). These cases are pending and no action should be taken to enforce the Judgment and alter the status quo until the issues are fully determined. A warning had previously been issued to prevent all parties involved and the public from trading or honoring the notes issued.”
The governors said that the meaning and essence of the final ruling of the Supreme Court is that none of the contractors recommended for the payment of the sum of $418 million by the AGF and the finance minister can be paid because the contracts and payments in the they are based on were not processed in the manner prescribed by the Constitution and the law.
“Certainly the funds cannot be accessed through the Federation Account as vigorously sought by AGF and HMF. Those contracts in their current form are unconstitutional and illegal and cannot confer any legal rights on any of the contractors. It is irrelevant that part of the contract sums have been paid.
“These payments did not validate the illegality of the contracts. The SC has spoken. It is final and must be obeyed. The excerpt of the CS decision is attached for easy reference”, argued the governors.
long battle
The NGF said it had consistently held that neither the states nor ALGON can appropriate or deduct money directly from the federation account whose funds must be paid into the joint state/local government account for which the state houses of assembly must still originate and derive from judgments in which the custodian States of the common account have not been a party.
The position, he argued, has been reinforced by the recent Supreme Court decision in the RIOK Case.
“Therefore, the NGF urges that the AGF and HMF must not, under any pretext, stampede the FEC into making a decision that will not only be manifestly unconstitutional and illegal, but also an affront to the highest court of the country. The rule of law is not only supreme; it is a cardinal principle promoted by the present administration and must be strictly obeyed on this particular occasion,” the letter said.
“Given the crushing economic realities and security challenges facing the nation and the competitive allocation of scarce resources, paying contractors the whopping $418 million from the public treasury is not and should not be FEC’s priority.
“FEC may also wish to point out that the undue haste with which AGF and HMF have pursued and processed the payment of contractors in the Paris Club reimbursement has already created the impression in the more discerning minds of the public that it would appear that the interest of contractors takes precedence over the welfare and interest of the general public, whom high government officials have sworn to uphold and protect.
“Therefore, the NGF advises the FEC to prevail over the AGF and HMF to toe the line of constitutionality and allow due process of law to prevail.”