By Tabora Bojang
The government litigation payouts rose sharply from D9 million to D112,443,067.60 in 2023, with another staggering D3,648,481,069.08 in potential liabilities pending.
These figures are contained in the auditor general’s reports tabled in the National Assembly that detailed comprehensive breakdown of all central government revenue and expenditures in the 2021-2023 fiscal year.
“During our recent audit, we observed a concerning rise in contingent liabilities, particularly those stemming from ongoing litigation cases. These contingent liabilities may materialise depending on the outcome of legal disputes, and their escalation poses a significant risk to the government’s fiscal stability,” the auditor general’s report said.
The report also indicated that court awards paid in 2022 amounts to D66,036,531.62.
Recommendations
The auditors recommended that government should improve management of contingent liabilities through better monitoring, regular updates and enhanced disclosure, promote arbitration and out-of-court settlements to minimise legal costs and reputational damage as well as educate government agencies on litigation risks and fiscal responsibility to prevent negligent actions leading to lawsuits.
In response to the audit findings, the Ministry of Finance explained that it will enhance collaboration with the Ministry of Justice to take stock of outstanding cases of arbitration and also include contingent liabilities relating to arbitration in fiscal risk statement and debt analysis.
