President Muhammadu Buhari has told the Association of Local Governments in Nigeria that his government will not be able to release its $3.2bn because of the current state of the economy.
According to the Senior Special Assistant to the President on Media and Publicity, Mr. Garba Shehu, Buhari said this while receiving the leadership of ALGON on Thursday.
Two court judgments had awarded ALGON about $3.2bn against the Federal Government in 2013.
One of the suits, FHC/ABJ/CS/130,2013, was filed in 2013 by ALGON and Linas International Limited challenging the alleged Federal Government’s unilateral withdrawal of funds from the Federation Account to fund the London Club debt buyback of 1992 and the London Club debt exit payment of 2006.
The acting ALGON National President, Alhaji Ibrahim Karaye, presented a six-point demand to the President which included the repayment of the $3.2bn debt and the need to ensure the sovereignty of local government administration in the country.
The President acknowledged the request by ALGON for the release of the money wrongfully deducted by the Federal Government for the final settlement of foreign debts in 2005.
Supported by Mrs. Kemi Adeosun, the Minister of Finance, President Buhari said the government recognised the judgment debt but the timing of the request for its repayment was wrong given the current economic situation in the country.
Buhari said his administration would support a constitutional amendment to free local governments from the stranglehold of states and better the lot of Nigerians at the community level.
He said a constitutional amendment was urgently required to clearly define the relationship among the three tiers of government.
The President described the frosty relationship between states and local governments as “a very serious constitutional problem.”
“The relationship between the three tiers of government is not a very nice one, especially that between the local governments and the states.
“The states feel like they own the local governments, if they are of the same party. It is worse if they are not.
“This is a very serious constitutional problem and unless there is absolute clarity and transparency, the relationship will continue to be exploited against the interest of the ordinary people of the country,” the President said.
Buhari advised the ALGON executives to hold consultations with their people and lawyers with a view to presenting a bill that would seek a constitutional amendment to free the councils from the stranglehold of the states.
“This will limit the damage they can do to you. The quicker you do this the better, so that you can help your people much more,” the President said.
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