BY BRIGHT JACOB
The Socio-Economic Rights and Accountability Project has accused the 36 state governors of failing to account for the spending of N72 billion palliative collected from the Federal Government.
In a statement on Sunday, the group’s deputy director, Kolawole Oluwadare, said it has filed a lawsuit against the governors, saying they also failed to include the details of the beneficiaries and the reliefs provided with the money.
Recently, the Federal Government disbursed N2 billion out of the N5 billion palliative package to each state of the federation and the Federal Capital Territory to address the impact of the removal of fuel subsidy.
In the suit number FHC/L/CS/1943/2023 filed last Friday at the Federal High Court in Lagos, SERAP is seeking: “an order of mandamus to direct and compel each of the 36 state governors to account for the spending of the N2 billion palliative collected by the governors from the Federal Government.”
The group wants the court to issue “an order of mandamus to direct and compel each of the 36 state governors to disclose details of the beneficiaries and the reliefs provided to the poorest and most vulnerable Nigerians with the money.”
It also seeks “an order of mandamus to direct and compel each of the 36 state governors to instruct the Independent Corrupt Practices and Other Related Offences Commission (ICPC) and the Economic and Financial Crimes Commission (EFCC) to monitor the spending of fuel subsidy palliative collected by them.”
“The failure by the governors to account for the public funds is both legally and morally wrong”
“Government secrecy is fundamentally anti-democratic. Secrecy in the spending of the N72 billion collected by the 36 state governors would create distrust or suspicion of the government. The failure by the governors to account for the public funds is both legally and morally wrong.
“The 36 state governors are constitutionally required to act in the public interest. Secrecy in government is a form of coercion. Government secrecy promotes arbitrariness and covers illegal acts,” the statement read.
No date has been fixed for the hearing of the suit.
On September 10, 2023, SERAP had given the 36 state governors a week ultimatum to disclose details of spending of the N2 billion palliative received from the Federal Government.
In August, the Federal Government announced a N5 billion palliative package for each state of the Federation, including the Federal Capital Territory to cushion the effect of the removal of the fuel subsidy.
On September 8, 2023, the Minister of Finance, Wale Edun, said the Federal Government had released only N2 billion from the N5 billion loan it offered to each state as a palliative to cushion the effect of subsidy removal.
He explained that the whole package was not released to the state governments to prevent spiral inflation as a result of too much cash in the system.
He said, “Although the sum of N5 billion is earmarked, you will agree with me that to release such funds across all the states, all at once, will be self-defeating because it will lead to an inflationary spiral, it will lead to the cost of the goods being sold going up, it will lead to the exchange rate moving.
This explains the two billion naira that has been released as an initial intervention.”
Edun stated that the Nigerian money outside of the country is huge while cash outside of the banking system is also substantial hence the need to urgently mobilise the money back to the system to shore up the value of the naira.
“There is a lot of cash outside the system, which, if brought into the system, will increase the money supply of dollars and increase the reserves. There are funds in domiciliary accounts, which if you give people the incentive, they will utilise for investment in Nigeria. Nigerians in Nigeria have huge holdings of foreign currency in banks abroad and financial institutions abroad.
“We need to provide the environment that brings those funds home to choose to invest in the Nigerian economy rather than foreign economies, which is what they are doing now. If you place money in a bank abroad, they’re investing in a foreign economy,” he added.
