The African Democratic Congress (ADC) Coalition has strongly condemned President Bola Tinubu’s approval of the cancellation of legacy debts owed by the Nigerian National Petroleum Company Limited (NNPC Ltd) to the Federation Account, describing the action as unconstitutional and detrimental to subnational governments.
The presidential directive, which cancels approximately $1.42 billion and N5.57 trillion in outstanding obligations, covers long-standing liabilities from production sharing contracts, domestic supply obligations, royalty receivables, and other legacy balances accumulated up to December 31, 2024.
According to documents presented to the Federation Account Allocation Committee (FAAC), this move erases nearly 96% of dollar-denominated debts and 88% of naira denominated balances through an executive "reconciliation" process, without legislative approval or clear constitutional authority.
The ADC Coalition argues that this decision violates Section 162 of the 1999 Constitution (as amended), which mandates that all revenues due to the Federation including oil-sector receipts and related obligations must be paid into the Federation Account for equitable distribution among federal, state, and local governments.
By unilaterally writing off these debts, the President has effectively shrunk the revenue pool available to states and local governments, erasing public liabilities that belong to the Nigerian people.
"The Federation Account is not subject to executive discretion, no President, including this one, has the unilateral authority to cancel constitutionally due revenues," said Bolaji Abdullahi, Spokesperson for the ADC Coalition. "Any cancellation that reduces revenue due to states and local governments without legislative authority is unconstitutional and undermines the principles of federalism."
The Coalition further accused President Tinubu of repeated constitutional violations and expressed alarm over the apparent collusion or inaction of the National Assembly, stating that such executive overreach should be grounds for impeachment proceedings.
"Nigeria must remain a nation of laws, and not of men," Abdullahi added. "The Federation Account belongs to all tiers of government and cannot be subjected to the whims of the Federal Executive or the President alone."
The ADC Coalition calls on the National Assembly to immediately investigate this matter, reverse the cancellation, and ensure that all future revenue decisions adhere strictly to constitutional provisions. It urges Nigerians to hold leaders accountable and demand transparency in the management of national resources.