State Governors Battle Buhari Over payment Of Paris Club $418 Million Loan related Judgment Debts

By Elizabeth Chukwuma

 Between February 2021 and now, there have been underground battle between the governors of the 36 states of the Federation and President Muhammadu Buhari, a retired Army General, over the payment of the Paris Club 418 million judgment debts.

 The case has been a subject of litigation as the state governors had repeatedly told the Katina state born Nigerian President not to tamper with their monthly revenue allocation to raise the funds to join the Federal government in paying back judgment debts.  The retired Army General may have dragged the states FCT and Association of Local Governments Areas of Nigeria, popular, ALGON, into the Paris club loan judgment debts saga because they were said to have benefited to the tune of N162.1 billion, to be repaid in 10 years.

Trouble may have started when the Debt Management office, DMO, at the instance of the Nigerian President had released the repayment plan for the Paris club loan judgment debts showing the amount that was allocated to each of the 36 states and the FCT, including the LGAs.

The DMO was supposed to have repaid the Paris Club $418 million loan in form of Promissory notes but the Nigerian President was said to have stopped it because of pressure from the governors and critics who had described’’ the payments as suspicious’’.One of the critics was Ndudi Elumelu, the Opposition Peoples Democratic Party, PDP, minority Leader in the House of Representatives.

Hon. Elumelu: PDP Minority Leader In The House Of Reps. Raised Objections By The FG, Payments of the Paris Club Judgment Debts To The Consultants

  Elumelu,   had revealed that the judgment debts are owed to some individuals and entities, who had rendered services to the states, FCT and ALGON, arising from the Paris club $418 million, loan repayment. He may have alluded to Ned Nwoko, one of the Federal government creditors over the Paris club loan refunds and who incidentally is an International Lawyer, and owns a firm, Linas International Limited.

The Delta state Lawmaker, representing Aniocha/Oshimili Federal Constituency in the National Assembly had said that Nwoko, who was a the former member of the House between 1999 and 2003, had used his firm in ‘’the consultancy  for the Paris club  $418 million refund’’.

The PDP, Minority Leader who could not see why the government should pay the Consultants  who had claimed to have worked for the states and ALGON,  was said to have repeatedly  raised strident ‘’objections to any approval  by the Nigerian President  for the payment  of the debts allegedly owed the consultants’’.  

Malami: Minister Of Justice And Attorney General of The Federation Reached An Out-Of-Court Settlement With The Paris Club Loan Repayment Creditors

 It was learnt Abubakar Malami, a Senior Advocate of Nigeria, SAN, and who is incidentally  the minister of Justice and Attorney General of the Federation, had persuaded Buhari, ‘’to approve the Consultants claims to the Paris  clubs  loan repayment because ‘’the country’s foreign assets might be attached to recover the unpaid loan’’.  

The approval for the payment of the Paris Club $418 million judgment debts by the Katsina state born Nigerian President, may have opened up a new chapter as some Consultants were said to have shown up along the line to claim a certain percentage of the funds as payment for their services to the states, FCT, and the Local Government Areas. They Consultants had claimed that the Leadership of the Association of Local Governments of Nigeria, ALGON, had asked them to execute projects in the 774 LGAS, across the country which was done.

An aggrieved Elumelu had was   said to have told the retired Army General  that the  consent judgment  being relied upon  for the payment of the Consultants  is ‘’cloudy, opaque and raises apprehensions of huge swindle on the national treasury which requires immediate investigation by the Abdulrasheed Bawa led Economic and Financial Crimes Commission, EFCC. The antigraft agency was said to have already stepped into the matter.   

 The Paris Club $418 million loan Consultants, may have gone to Court to force the government to pay their debts for their consultancy services to the states, FCT and ALGON. Malami, the minister of Justice and Attorney General of Federation was aid to have negotiated an out-of -court settlement with the Consultants with a promise that the Federal government will pay the $418 million Paris Club loan without any deductions from the states and the FCT, monthly revenue allocation and the judgment debts.

The Leadership of the Nigerian Governors Forum, NGF,  may have realised that the minister’s  promise that the Federal government will pay the $418 million Paris Club without any deductions from the states, FCT, and the Local Government Areas, monthly allocations to raise funds to liquidate the Paris club refund and the judgment debts of the Consultants  does not hold waters.

This may have encouraged them to  have warned  the Buhari led All Progressive Congress, APC, government,  not ‘’to tamper  with funds accruing to the states, FCT, and the  774 Local Government   Areas, across the country  in the guise  of satisfying  an alleged $418 million Paris Club refund related judgment debts’’.

Gov. Fayaemi: Chairman, NGF

Kayode Fayemi, governor of Ekiti state and Chairman of the NGF, may have spoken the mind of the governors, when he said the Federal government, FG, ought not to have  dragged the states, FCT, and the 774 LGAs, into the $418 million, Paris club related judgment debts  payment because  they were not ‘’parties  to any suit  on the Paris  club debt refund and as such  were not liable to any person  or entity  in any judgment  debt  being relied on by the FG’’.

The NGF, Leadership were said to have to have sent a warning letter to Hajia Zainab Ahmed, minister of Finance, Budget and National Planning, on April 4, 2022, in response to a November 11, 2021, memo, from the minister’s office, advertising the commencement of the deduction from the states, FCT, and the 774, LGAs, monthly allocation of funds from the Federation account for the liquidation of the alleged Paris club $418 million judgment debts.

The NGF, letter to the minister of Finance warning about any deductions from the states, FCT and Local Government Areas monthly allocation coming from the Federation account, was said to have been signed by Moyosore Onigbanjo, SAN, and Commissioner of Justice and Attorney General of  Lagos state and Abubakar Kana, Attorney General of Nasarawa state. While Onigbanjo, the Lagos state Commissioner for Justice and Attorney General, is the interim Chairman of the 36 states of the Federation, Attorney Generals, Abubakar Kana, the Nasarawa state Attorney General is the Secretary General.

The Commissioners for Justice and Attorney Generals of Rivers, Abia, Traba, Benue and Zamfara, states were said to have also signed the NGF, letter to the FG, to force the minister of Finance and the Presidency to refrain from making any deductions of funds from their statutory monthly allocations from the Federation Account.

It is interesting to note that the deductions of the monthly allocations of funds due to the states of the Federation, FCT, and the 774 LGAs, from the Federation Account to liquidate the Paris club $418 million loan refund related  judgment debts  is the subject of an  Appeal that had been filed  by the  36 states at a Federal High Court of Appeal in Abuja, awaiting for judgment.

Whether Buhari will refrain from directing the Revenue Mobilisation and Allocation Committee, RMAC, to stay action until the case is decided in Court remain to be seen.   

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