Court orders Nigerian govt, states, LGAs to set limits on public debt

The Federal High Court in Abuja has ordered the Nigerian government to set the limits of the consolidated debt of federal, state and local governments.

According to Justice G.O. Kolawole of the Federal High Court, the judgement is in compliance with section 42 (1) of the Fiscal Responsibility Act.

The judgement, delivered February 20, was sequel to a suit No. FHC/ABJ/CS/302/2013, filed by the Centre for Social Justice Limited (CSJ) against five defendants including the President of the Federal Republic of Nigeria, Muhammadu Buhari; the Senate of the Federal Republic of Nigeria; the House of Representatives of the Federal Republic of Nigeria; the Minister of Finance, Kemi Adeosun; and the Attorney General of the Federation and Minister of Justice, Abubakar Malami.

In the court documents seen by PREMIUM TIMES, the CSJ demanded a declaration that the president’s continued refusal to set the overall limits for the amounts of consolidated debt of the federal, state and local governments in Nigeria constitutes a violation of section 42 (1) of the Fiscal Responsibility Act 2007 and a violation of Nigeria’s constitution.

But the defendants pleaded inter alia that compliance with the provision of Section 42 (1) of the Fiscal Responsibility Act will be difficult and it is a process that takes a lot of time as it will involve the computation of the Gross Domestic Product of states and the reconstruction of their domestic debt data.

The defendants also raised other technical issues including the fact that this limitation should have been set by the defendants within 90 days of the commencement of the Fiscal Responsibility Act on July 30, 2007. As such, the defendants argued that the cause of action had lapsed and the fact that President Muhammadu Buhari was not the president at the time of the commencement of the Act weighed against the plaintiff’s action.

After listening to the parties, the court gave judgement that the relief being sought by the plaintiff (CSJ) be granted as pleaded.

The judge said: “Having regard to the answers given to the two (2) questions based on my interpretation of the provision of section 42 (1) of the Fiscal Responsibility Act, supra, that it is mandatory, it is my decision that the reliefs being sought ought to succeed, and they are granted as pleaded.

“In relation to relief (4) in the Plaintiff’s “Originating Summons”, in the exercise of my inherent jurisdiction pursuant to the provision of Order 56 Rule 1 of the Federal High Court (Civil Procedure) Rules, 2009, the 1st and 4th Defendants shall within 90 days from today, comply with and execute the provision of Section 42 (1) of the Fiscal Responsibility Act, 2007.

“In the event that they were unable to conclude with the process which the 1st and 5th Defendants’ counsel has argued was already on its way within the said period, the 1st and 4th Defendants shall be at liberty through the 5th Defendant to apply to a Court of competent jurisdiction to extend the period within which the mandatory provision of Section 42 (1) of the Fiscal Responsibility Act, supra can be fully complied by a presentation made by the 1st Defendant on the advice of the 4th Defendant to the 2nd and 3rd Defendants.”

The judge also noted that the plaintiff who is enabled by the provision of Section 51 of the Act, ought to be commended as its action was intended to jolt the 1st, 4th and 5th Defendants to do that which is necessary in order to give the Federal Government of Nigeria’s current policy on anti-corruption a necessary boost within the ambits of the law which has largely been obeyed by refusal of successive administration to execute the provision in Section 42 (1) of the Fiscal Responsibility Act, supra.

“There shall be no order as to costs, each party shall bear its own costs. This shall be the Judgement of this court which I reserved after I listened to the re-adoption of the addresses filed and exchanged by the 1st and 5th Defendants on 15/2/18,” the judge added.

In his comments, Eze Onyekpere, Lead Director at CSJ said the organisation awaits compliance by the authorities.

“We await the defendants’ compliance with the court order,” he said in a statement made available to PREMIUM TIMES.