Barring any last-minute changes, local government councils across Nigeria will begin receiving direct allocations from the Federation Account starting next month. This significant development is expected to commence with the disbursement of December’s allocation, marking a pivotal shift in governance at the grassroots level.
The move follows the Supreme Court’s July 11 judgment, which granted financial autonomy to local councils. While the ruling was clear, its implementation has faced delays due to resistance from state governors who are displeased with the loss of control over local government funds. For decades, allocations to councils have been paid into state/local government joint accounts, a system that critics say has stifled local governance and fostered mismanagement.
Efforts by the Federal Government to implement the ruling with minimal disruption have been ongoing. A source within the Inter-Ministerial Committee tasked with enforcing the judgment confirmed that approval has been granted for full implementation of direct allocations to all 774 local government areas (LGAs) by January 2025.
The committee member revealed that while a few LGAs have already started receiving direct allocations, the process will become fully operational nationwide from January. “This is a critical juncture in Nigeria’s governance structure,” the source stated. The committee will reconvene in January 2025 to assess progress and finalize any outstanding measures. The Accountant-General of the Federation is expected to issue the final authorizations for the rollout.
The committee is also addressing reports of governors attempting to undermine the autonomy of elected LGA chairmen, deputies, and councillors by coercing them into aligning with state government interests. “We will ensure that these local governments are free to carry out their constitutional responsibilities without undue interference,” the source added.
However, challenges remain. The suspension of democratically elected local government officials in Edo State by the state House of Assembly has drawn widespread criticism. This action, based on allegations of insubordination against the chairmen for failing to provide financial statements as requested by Governor Monday Okpebholo, has been described as undemocratic.
“It is highly undemocratic for governors to dissolve elected LGAs,” the source lamented. “Such actions undermine the autonomy granted to local governments and reduce them to mere tools in the hands of state executives.”The inter-ministerial committee is chaired by the Secretary to the Government of the Federation (SGF), George Akume. Other members include Coordinating Minister of the Economy Wale Edun, Attorney-General of the Federation and Minister of Justice Lateef Fagbemi (SAN), Minister of Budget and Economic Planning Abubakar Bagudu, Accountant General of the Federation Oluwatoyin Madein, Central Bank Governor Olayemi Cardoso, Revenue Mobilisation Allocation and Fiscal Commission Chairman Muhammed Shehu, as well as representatives of state governments and local councils.
President Bola Ahmed Tinubu has strongly endorsed financial independence for councils, emphasizing the constitutional recognition of local governments as the third tier of government. Attorney-General Fagbemi has also threatened contempt proceedings against governors who fail to comply with the Supreme Court’s ruling. He stressed that local government autonomy is intended to empower grassroots governance and warned that any LGA chairman found diverting funds would face severe legal consequences.
In some states, however, there are attempts to bypass the Supreme Court’s judgment. For example, the Anambra State House of Assembly recently passed a Local Government Administration Bill requiring LGAs to remit part of their allocations into a state-controlled joint account. Governor Chukwuma Soludo defended the law, citing the need for transparency and collaboration. However, critics, including civil society organizations, argue that the legislation undermines local government autonomy and violates the Supreme Court judgment.
As this new era of financial autonomy begins, its success will depend on strict enforcement, accountability, and resistance to any attempts to undermine the constitutional provisions designed to empower local councils and bring development closer to the grassroots.
