NPTF Deductions: FG Moves for Out-of-court Settlement


By Alex Enumah

The federal government on Monday disclosed that it has entered into discussions with the Rivers State Government for an amicable out-of-court settlement of the dispute over deduction of funds from the Federation Account into the Nigeria Police Trust Fund (NPTF).

The Solicitor General of the Federation and Permanent Secretary, Federal Ministry of Justice, Chief Dayo Apata (SAN), told Justice Ahmed Mohammed of the Federal High Court Abuja that the federal government took the option in the overall interest of national security.

“The matter was adjourned for hearing today, my Lord, but myself and other defendants’ counsel have held discussion with the counsel to the plaintiff (Rivers State). This matter is predicated on the security of Nigeria as a corporate entity.

“We are looking at the larger picture and we considered it necessary that we should sit down and work out amicable settlement, and we appreciate the plaintiff counsel for his understanding that we should take adjournment for meaningful resolution of this matter,” he said.

Responding, the counsel to the plaintiff, Chief Ifedayo Adedipe (SAN), confirmed Apata’s statement, adding that the plaintiff is not averse to an amicable out-of-court settlement.

He also did not oppose a short adjournment as requested by counsel to the federal government.

Consequently, Justice Mohammed adjourned the matter to October 7, 2020 for the report of settlement.

At the last hearing, the court had declined request by the Rivers State Government for an order to temporarily stop the deduction of funds from the Federation Account into the Nigeria Police Trust Fund.

Rather, Justice Mohammed approved accelerated hearing of the substantive suit and at the same time urged all parties to explore an out-of-court settlement of the matter.

Mr Joseph Daudu (SAN), who represented Rivers State, had urged the court to issue an interim order to suspend the funds deduction, after the federal government’s counsel in the case pleaded for more time to seek an amicable resolution of the dispute.

But the defendants’ lawyers had opposed the application and equally declined to give an undertaking for the suspension of the funds deduction.

Again, the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), which was cited as the 3rd defendant, was not represented by any lawyer at the proceedings on Monday.

The Rivers State Government, through its Attorney-General had in the suit it filed on May 20, challenged the constitutionality and validity of section 4(1)(a) and Section 4(1)(b) of the Nigeria Police Trust Fund (Establishment) Act 2019, which permits the deduction of 0.5 per cent of the total revenue accruing to the Federation Account and be paid to the Nigeria Police Trust Fund.

Governor Nyesom Wike-led Rivers State Government, in the suit marked FHC/ABJ/CS/511/2020, argued that it was not the responsibility of state governments but that of the federal government to fund the police.

It contended that by virtue of Section 162 (3) of the Nigerian Constitution, funds standing to the credit of the Federation Account “can only be distributed among the federal government, state governments and local government councils in each state of Nigeria and not directly to any agency of the federal government including the Nigeria Police Force”.

The plaintiff urged the court to among other things, declare the section of the law “permitting the direct deduction of any sum or percentage of revenue accruing to the Federation Account or which ought to have been paid into the Federation Account for the purpose of providing funds for the Nigeria Police Trust Fund as ‘unconstitutional, null and void’.”

It also urged the court to order a refund of the money deducted from the Federation Account and paid into the NPTF since it was formed.