The African Democratic Congress (ADC) has condemned President Bola Ahmed 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 the finances of states and local governments.
In a statement issued by its National Publicity Secretary, Mallam Bolaji Abdullahi, the party said the decision violated Section 162 of the 1999 Constitution (as amended), which mandates that all revenues due to the Federation be paid into the Federation Account and shared among the three tiers of government.
According to the ADC, official documents presented to the Federation Account Allocation Committee (FAAC) indicate that the President approved the removal of approximately $1.42 billion and N5.57 trillion in legacy NNPC debts from the Federation Account books.
The cancelled liabilities reportedly include debts arising from production sharing contracts, domestic supply obligations, royalty receivables and other legacy balances accumulated up to December 31, 2024.
The party expressed concern that nearly 96 per cent of the dollar-denominated debts and 88 per cent of the naira-denominated obligations were written off through an executive directive without legislative approval or clear constitutional authority.
The ADC argued that the justification of “reconciliation” of records with regulators could not override constitutional provisions governing revenue collection and distribution. It warned that the action effectively reduces the revenue base available for constitutionally mandated distribution to states and local governments.
The party further accused President Tinubu of repeatedly breaching the Constitution and criticised the National Assembly for what it described as silence or complicity in the face of a serious constitutional violation. It stated that such actions, if unchecked, undermine the rule of law and federal fiscal arrangements.
“The Federation Account is not subject to executive discretion, and no President has the unilateral authority to cancel revenues constitutionally due to the Federation,” the ADC said, insisting that any cancellation of such revenues without legislative backing is unconstitutional.
The party called for strict adherence to constitutional provisions, stressing that the Federation Account belongs to all tiers of government and must not be subjected to the discretion of the Federal Executive.
