President Muhammadu Buhari has put on hold the payment of $418 million to consultants over the Paris Club refund which has generated a lot of controversy in the last two years.
Despite initially approving the payment, President Buhari is said to have directed the ministry of finance to ask the Debt Management Office (DMO), which was supposed to pay in form of promissory notes, to stay action “until all the cases are exhausted”.
Sources say that there had been pressure from the Nigeria Governors Forum (NGF) and the general public to stop the suspicious payments.
All former presidents, including Olusegun Obasanjo, refused to approve the payment because of lack of evidence of work done.
Many have drawn a parallel with the P&ID case over a gas processing contract that was never executed but for which Nigeria was slammed with a fine of over $10 billion.
Abubakar Malami, the attorney-general of the federation, reportedly persuaded Buhari to approve the Paris Club claims because Nigeria’s foreign assets “might be attached”.
However, Kayode Fayemi, governor of Ekiti state and chairman of NGF, met with the president on Wednesday evening over the controversy.
In 2006, the federal government had paid $12 billion to get an $18 billion debt write-off by the Paris Club of international creditors.
However, because the payment was made directly from the revenue accusing to the entire federation, states and LGAs that did not owe the Paris Club asked the federal government for a refund.
Some consultants surfaced along the line to claim a percentage of the refunds as payment for their services to the states and councils.
Some contractors also claimed they were asked to execute projects across the country by the Association of Local Governments of Nigeria (ALGON).
Questions were asked about why states would need consultants to negotiate with federal government over the refund, while the projects said to have been awarded by ALGON turned out to be mostly non-existent.
While the contractors and consultants went to court, Malami curiously went to negotiate an out-of-court settlement with them and agreed to pay $418 million as judgment debt.
Despite opposition by the governors and activists, Buhari went ahead to approve the payments.
However, his decision to “stay action” may not be final — in the past, a dubious payment of legal fees was made to lawyers over the Abacha Loot despite the president initially holding off.
Enrico Monfiri, a Swiss lawyer, had already been paid by Nigeria for the recovery of the loot and all that was left was for Malami to write for the money to be repatriated.
But he went ahead and engaged lawyers to write the letter, and they were paid $17 million — $5 million more than Monfrini who had traced and frozen the loot over a period of seven years.