Home Economy Nigeria risks losing $10bn to P&ID judgment debt as FG Probes rip off contracts

Nigeria risks losing $10bn to P&ID judgment debt as FG Probes rip off contracts

by Business News Report

Federal Government said its ongoing  holistic probe into  contracts allegedly signed by previous administrations with Process and Industrial Development Limited (P & ID) which were in breach of due process and  procedure with  capacity to undermining nation’s economy to the tune of $10billion. Speaking in Abuja when he appeared  before the Senator Opeyemi Bamidele, led Senate Committee on Judiciary, Human Rights and Legal Matters during the defence of the 2022 budget proposals, the Attorney General of the Federation and  Minister of Justice, Abubakar Malami said that  P&ID contract was never ever  allowed to pass through the office of the Attorney General and that the contract clauses, were inimical to Nigeria’s interest. Malami said that the  Taskforce set up for investigation  will spend N1.1 billion in 2022 to carry out holistic findings  on nine other contracts signed against the interest of the country by previous administrations. He said “It is the Taskforce that is intended to review the existing problematic contracts that have the capacity to undermine the economy as far as the P&ID is concerned.

“In the office of the Attorney General, there exists two fundamental departments relating to getting of contracts. Solicitor Department is charged with vetting any governmental contract and they have lived up to expectations over time.  But the major problem with P&ID is that contract was never ever allowed to pass through the Office of the Attorney General for vetting. So, on  account of that, there are clauses  embedded in the contract  that are  inimical to the interest of the nation. Because of the fact that there is a preliminary conspiracy among the key promoters of the contract, the contract was never allowed to pass through the Federal Executive Council, FEC for its approval, neither was it allowed to pass through the Federal Ministry of Justice for vetting. The existing structures are there, but they can only act in respect of contracts that are referred to the department. 

“For example, as it is now, even though in respect of government contracts, arising from the fact that China is involving certain clauses regarding immunity which some ministries and departments are willing to compromise, they are not allowed to pass. We have developed need for other circulars that these are intended clauses that could be tolerated in public interest and the interest of the nation in mind were attached. What I’m saying in essence is that the Taskforce is poised at looking at it. In respect of P&ID, there were about nine contracts that were signed at the same time in breach of due processes and procedures.” In January 2017, an independent London tribunal found that Nigeria was liable for $6.6 billion in damages against Process and Industrial Development (P&ID) after it failed to deliver on terms agreed in a 2010 gas facility contract. Three years later, and prompted by P&ID looking for enforcement of the ruling, a United Kingdom (U.K.) court ruled that Nigeria’s state-owned assets could be seized if the country refused to settle its bill, which had risen to $9.6 billion because of accrued interest. Nigeria was granted the right to appeal but asked to pay $200 million in the meantime.

In his opening remarks, Senator Bamidele who lamented soaring Judgement Debts which has become National embarrassment demanding urgent action about the development from the Ministry of Justice, said, “It is also pertinent to state that the judgement debt profile of the country keeps soaring without corresponding response from government in order to address the situation. This development is now viewed as a national embarrassment and necessary action must be taken to ensure that the image of the country is protected. In this regard , I implore you prioritize your budget and make a case for legislative intervention where necessary, in order to ensure that this area of concern is critically looked into, with a view to proffering the much needed solution.” The Ministry proposed N11.8 billion for 2022 budget . The Personel cost – N3.9 billion, overhead cost (exclusive of Legal Services) – N2.4bn , Legal Services – M2 billion , Capital budget- N3.5 billion.

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