States kick against $418m deductions for Paris Club

State governments have implored the Federal Government to refrain from sourcing the Paris Club debt payment from their coffers.

The federal government has been deducting from funds accruing to the state and local government councils as liquidation for the alleged $418 million London/Paris Club loan refund-related judgment debts.

The governors said this in a letter dated April 4 in response to a November 11, 2021 letter from the minister of finance, budget, and national planning, advertising the commencement of the deduction for the liquidation of the alleged judgment debts.

The state governments said they were not parties to any suit on the London/Paris Club refund and were thus not liable to any person or entity in any judgment debt being relied on by the federal government.

The document was signed was by leaders of the body of attorneys-general of the federation, including the interim Chairman, Moyosore Onigbanjo (SAN), of Lagos state, and the interim Secretary, Abdulkarim Kana of Nasarawa state, as well as the attorneys-general of Rivers, Abia, Taraba, Benue, and Zamfara states, for and on behalf of all the state attorneys-general.

The letter read, “Their Excellencies have drawn our attention to your letter referenced above, which the various states of the federation received at about the end of March 2022. The letter notifies the states of your intention to commence deduction from allocations due to the states from the Federation Account for the liquidation of the London/Paris Club Loan refund-related judgment debts on behalf of the 36 States of the federation and the 774 local government councils.

“Please note that the states of the federation were not parties to any contract or suits concerning the London/Paris Club refund, from which the said judgment debts arose. Consequently, the 36 States of the federation are not liable to any person or entity in any judgment debt.”

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