Paris Club refund: Governors can’t back out of payment to consultants, says Malami



Abubakar Malami, attorney-general of the federation (AGF), says there is no going back on the federal government’s decision to deduct $418 million from the 36 states’ accounts to pay private consultants for the Paris Club refund.

Speaking with journalists on Wednesday in Abuja, he said it was too late for the governors to backtrack on the indebtedness they had earlier acknowledged and committed to pay.


The governors had recently obtained an order from a federal high court in Abuja, restraining the federal government from deducting $418 million from states’ accounts for the purpose of paying the disputed debt.


On Monday, the NGF accused Malami of bias in handling the controversial debt.

They said his decision to throw his weight behind the consultants “raises questions of propriety and the spirit of justice.”


Tracing the genesis of the dispute, Malami said the NGF and the Association of Local Governments of Nigeria (ALGON), as well as the consultants, entered into a consent judgment of $3.2 billion in 2013, which they made a commitment to pay and actually made part payments between 2016 and 2017.


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 decided to go to court after making part payments.


He recalled that because the federal government was suspicious of the huge claim the NGF and ALGON made on behalf of the consultants, which was about $3.2 billion, the FG invited the Economic and Financial Crimes Commission (EFCC) and the State Security Services (SSS) to verify the services rendered by the said consultants.


“So, when eventually the services rendered were confirmed, out of further abundance of caution, FG took steps to demand confirmation in writing from ALGON and the governors,” Malami explained.


“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 door step 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, perhaps copies could be made available to you after this session.


“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 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 over time.


“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 those are the antecedents that are of interest as far as this matter is concerned.”

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