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Governors Can’t Back Out Of Paris Club Debt, Says Malami

The move by governors to reverse the planned deduction of $418 million from states’ allocations to settle Paris Club Refund consultants hit a brick wall yesterday.

The Attorney-General of the Federation (AGF) and Minister of Justice Abubakar Malami (SAN) said it was too late for the Nigeria Governors’ Forum (NGF) to seek the reversal of the decision.

He maintained that since the 36 governors had earlier acknowledged the debt and made a commitment to pay the consultants and private firms, there was no going back.

The aggrieved governors had accused the AGF of bias in his handling of the disputed debt, saying that funds belonging to the Federation Account should not be arbitrarily deducted.

According to them, “states’ resources needed for critical development should not under any guise be frittered away as payment for contracts, whose veracity and authenticity are still a subject of litigation and disputation.”

The NGF added: “These contractors are impecunious and cannot restitute the states/LGAs, if the appeals or other litigation are determined against them.”

However, the AGF said, not only did the NGF, the Association of Local Government of Nigeria (ALGON) and the consultants enter into a consent judgment of $3,188, 079,505.56 ($3.2 billion) in 2013, they made the commitment to pay and actually made part payments between 3016 and 2017.

Malami, who spoke in Abuja yesterday, accused the NGF of blowing hot and cold at the same time and seeking to shut the barn door after the horse had bolted.

On whether the Federal Government’s insistence on the deduction would not amount to disrespecting an existing court order and circumventing pending court cases, Malami wondered why the states, which made a part payment since 2013, decided to go to court.

The NGF had, in a statement on Monday, accused Malami of betraying public interest by supporting private interests in his handling of the Paris Club Refund.

The NGF accused him of bias and hasty payment to the consultants when the states were in need of funds.

Last week, the governors obtained orders from the Federal High Court, Abuja, restraining the Federal Government from withdrawing funds from states’ accounts for the purpose of paying the disputed debt.

Tracing the genesis of the crisis, Malami said: “Sometimes as far back as 2013, there was an engagement by the outgoing administration and the NGF in respect of certain consultants that were engaged by the two (NGF and ALGON) for the purpose of recovering certain amounts of money relating to Paris Club refund.

“And these consultants that were engaged have indeed, delivered and fundamentally, they were not paid the fees for the services they claimed to have rendered and on account of which they approached the judicial system for the determination of their rights and indeed, the enforcement of their fees.

“Now, in 2013, the then Federal Government and the governors’ forum came together, agreed and submitted to a consent judgment by the court of law in 2013. That consent judgment is what gave rise to the liability in contention as we are talking today.

“Some years back, the Federal Government was approached by these consultants for the purpose of payment of their respective professional fees. The Federal Government then approached the governors’ forum and ALGON and they collectively walked to the Federal Government and conceded to the position that the consultants have indeed, provided the services and that they were ready and willing to pay.

“The point of interest arising therefrom is that the governors’ forum and ALGON walked to the Federal Government and conceded that payment should be deducted from their monies and then, should be effected to the consultants.

“And then, in 2016, 2017, these deductions were carried out at the instance of the governors’ forum and ALGON. Now, that was the situation on the ground.”

Malami recalled that since the Federal Government was suspicious of the huge claim the NGF and ALGON made on behalf of the consultants, which was in the region of $3.2b, the FG invited the Economic and Financial Crimes Commission (EFCC) and the State Security Services (SSS) to verify the services rendered by the consultants.

He added: “So, when eventually the services rendered were confirmed, the Federal Government took steps to demand confirmation in writing from ALGON and the governors.

“The governors individually wrote to the effect that they were liable. ALGON wrote to the effect that they were liable. And eventually, this payment commenced as far back as 2016.

“Now, nothing untoward happened thereafter until perhaps, of recent when the governors wrote seeking to avoid their liability.

“The implication of that, taking into consideration that the Federal Government was indeed, sued as a party, was that at the end of the day, the liability will be placed exclusively at the doorsteps of the Federal Government, where in actual fact, this is a liability that was incurred by the governors’ forum; this was a liability admitted by the governors’ forum.

“This is a case in respect of which the governors’ forum and ALGON conceded to judgment by way of submitting to a consent judgment before a court of law.

“So, what I am labouring to say, in effect, is that one, the engagement that gave rise to this liability was an engagement that was factored by ALGON and the governors’ forum.

“Two, arising from such liability, by way of creating a contractual obligation, parties submitted to the jurisdiction of the court in the form of the case instituted by consultants against the governors’ forum and against ALGON, and the parties submitted to the consent judgment.

“Three, the governors have indeed, each provided a letter of commitment to the Federal Government that they were indeed liable, the same thing with ALGON.

“They wrote individually; the governors wrote, individually directing the Federal Government to effect payment of this amount. And we have the letters at our disposal.

“So, what we are saying, in essence, is that this is a self-induced problem arising from the concession, arising from the consent, arising from the agreement of the governors’ forum and arising from the agreement of ALGON

“And then, four, over and above all these, payment has indeed, been effected over time without any objection on the part of ALGON and the governors’ forum.

“So, it is indeed, amazing that the governors are now belatedly, after having serviced the same claim for over a period of four-five years, are now belatedly turning round to raise objections in respect of the payment.

“This is even when one, they have consented on their own to a judgment, which was entered in 2013 before this government came in; two, they have been effecting periodic payment in respect of the same; three, they have provided individual indemnity and commitment that this payment should be effected over time.

“So, I think that is the antecedents that are of interest as far as this matter is concerned.”

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