The Ministry of Power, Works and Housing has, through negotiations and compromise, saved the Federal Government from paying over N119bn resulting from litigation, the ministry has said.
A statement by the Special Adviser on Communications to the Minister of Power, Works and Housing, Hakeem Bello, on Thursday said N119,369,520,000 liability had resulted from a judgment entered against the government over a litigation from a metering contract awarded by a previous administration in 2003.
According to the statement, Fashola disclosed this at a press briefing after Wednesday’s Federal Executive Council meeting, saying that one of the three memoranda the ministry took to the council for approval was in respect of an inherited liability from the former administration.
He explained that the judgment came “as a result of actions of officials of government who varied Presidential approval without seeking further directives from him.”
He added that the beneficiary of that contract, “which the officials subsequently sought to withdraw,” went to court and got a judgment.
He described the incident as one of the problems inherited from the last administration, saying, “But we have successfully reached a compromise on that matter, where the judgment has been compromised for the entire sum of N119bn to N19,369,520. So, government is no longer liable to, under this new agreement, pay that amount”.
The minister said that the successful negotiation was able to free up N39.17bn held under another judgment in court, to now be used for the supply of electricity metres to the electricity distribution companies. He added that all of the disputes arose from a contract to supply 3,000,000 metres entered into with the contractor and the National Electric Power Authority about 14 years ago.
“The contract was never fully performed by both parties; either by the contractor or government. So, from the very early days, they ended up in court. Government constituted one committee after the other to resolve the matter. So, there was a court judgment, money was left in the bank, the purpose couldn’t be achieved. Then a new contract was created, which became a liability of N119bn,” he said.