19 March 2017

Nigeria: Despite Pledging Transparency, Buhari's Govt. Conceals Details of Paris Club Refunds

Photo: Premium Times
President Buhari.

Months after paying N522.74 billion Paris Club loan refund to 36 states, the federal government has concealed details of the disbursements, frustrating Nigerians keen about knowing how their governors spent the huge amount, PREMIUM TIMES can report today.

For months, Finance Minister, Kemi Adeosun, and other senior officials blocked attempts by Nigerians, civil society and the media, including this newspaper, to obtain details of the payments, amid allegations of misuse by governors.

In authorising the payments in November 2016, President Muhammadu Buhari advised the money be used in settling arrears of workers' salaries, retirees' pension and gratuities.

Few states applied the funds as advised, PREMIUM TIMES found.

Last week, the Economic and Financial Crimes Commission (EFCC) confirmed it was investigating suspected misuse of the funds, but did not give details.

But despite the government's pledge to fight corruption by being more transparent, the Ministry of Finance, the Office of the Accountant General of the Federation, and the Debt Management Office, separately denied requests by Nigerians and groups to make those details open.

Secret sharing of $4 billion

Nigerians first knew of the refunds in November 2016 after the Chairman of the Senate Committee on Federal Capital Territory, Dino Melaye, accused the federal government of secretly sharing the money to states.

The lawmaker also accused the 36 states governors of attempts to conceal the payment from the public, especially civil servants.

But the finance minister, Mrs. Adeosun, promptly dismissed the allegation as "absolutely incorrect".

She said "there was no such money to share."

The minister did not provide further details, particularly regarding the accumulated refund of the debt service deductions in respect of the Paris Club, London Club and multilateral loans of the federal and state governments between 1995 and 2002.

Mrs. Adeosun merely explained that states were overcharged during the 2005 Paris Club for debt relief under the Obasanjo administration.

Following verification and approval by President Buhari, the minister said only 14 states would share N153.01 billion in the first disbursement, but did not disclose the names of the affected states.

Only a few states like Kaduna and Plateau, voluntarily admitted receiving payments.

Mrs. Adeosun later explained that there was an agreement with states that at least 25 per cent of each state's claim would be paid, subject to a cap of N14.5 billion, while balances due would be paid when the country's financial situation improves.

In the end, N522.74 billion was paid to the states.

FOI requests

After several fruitless visits to the Federal Ministry of Finance for details of the refund, PREMIUM TIMES got in touch with Mrs. Adeosun, who initially denied having details of the payment.

The minister later assured that appropriate personnel had been directed to get in touch with this newspaper with the needed details. No such personnel ever contacted this medium.

When PREMIUM TIMES sent a text message to remind the minister of her promise, her Secretary, Bridget Emakpor, called back to lash out at the reporter for making "inappropriate request".

No further information came from the ministry, and a Freedom of Information request sent on January 30, 2017 to the Minister appeared to have been ignored.

In a response to a similar request, the Accountant General of the Federation, Ahmed Idris, through the Director (Funds), Alexander Adeyemi, directed the newspaper to the Finance Minister for the information.

Again, no response came from the finance ministry.

Also, several telephone calls and text messages, and a FOI request to the Director General, Debt Management Office, Abraham Nwankwo, were also not responded to.

Mr. Nwankwo's spokesperson, Liman Balarabe, did not also respond to calls and text messages requesting details of the payments.

The ministry and the other agencies did not say why the government was reluctant to release the requested details.

Buhari orders release of second tranche of payment

Amid allegations of fund diversion, and lack of transparency, President Buhari on Thursday, ordered the immediate release of the second tranche of the fund to the states to ease their financial difficulties.

The Paris Club debt payment deal was sealed in October 2005. It involved the repayment of $12.3 billion, instead of $30.4 billion.

Out of the $30.4 billion, Nigeria was expected to pay only $6.3 billion (arrears & levelling up) and another $6billion (post cut-off date debt and debt buy-back), while the creditors agreed to cancel $18 billion, an overall debt reduction of about 60 per cent.

The Socio-Economic Rights and Accountability Project (SERAP) recently called on the federal government to sue states accused of diverting or mismanaging the refunds.

The executive director of SERAP, Adetokunbo Mumuni, said states should be compelled to publish what they collected and details of spending, either on a dedicated website or other media, to enable the people know what the monies were used for.

No state has done that yet.

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