2 months ago
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Yesterday’s Supreme Court judgement affirming financial autonomy for the local government system has sparked a debate among Nigerians with most respondents applauding the ruling.
The apex court had yesterday directed that the financial allocations meant for running all 774 local government areas in the country be paid to them directly.
It said that state governments have no right to keep and manage allocation on behalf of the local governments, a practice the court says is unconstitutional.
The federal government, through the attorney general of the federation and minister of justice, instituted the case against the 36 state governors for disbursing federal allocations to council areas contrary to the position of the 1999 Constitution.
Justice Emmanuel Agim, who prepared and read the lead judgement, maintained that state governors had, over the years, used the privileges conferred on them by the 1999 Constitution to defraud and rob the local governments of their rights.
Justice Agim said the constitution of the Federal Republic of Nigeria expressly declared that the allocation shall be shared and distributed among the three tiers of government.
The court equally ruled that the allocation to local government should be paid directly only to the democratically elected local government councils.
The court also stated that the state governors have no right to dissolve any democratically elected local government using state powers.
The apex court also ruled that, henceforth, no state government should be paid the allocation meant for the local government in the country.
The court added that the state government cannot replace the democratically elected local government with the caretaker committee.
However, the former governor of Delta State, Chief James Ibori, sharply disagreed with the Apex court, saying the judgement had dealt a severe setback to the principle of federalism as defined by section 162(3) of the 1999 Constitution.
According to him, the court’s ruling on the matter is an assault on true federalism.
“Any amount standing to the credit of the Federation Account shall be distributed among the federal and state governments and the local government councils in each state on such terms and in such manner as may be prescribed by the National Assembly.
“Section 6 provides further clarity on the subject matter: Each State shall maintain a special account to be called “State Joint Local Government Account” into which shall be paid all allocations to the Local Government Councils of the State from the Federation Account and the Government of the State,” Ibori argued.
Also, shortly after the judgement was delivered, respected lawyers and stakeholders applauded the apex court for the judgement.
Senior lawyers in Nigeria, Dr Ahmed Raji, told LEADERSHIP Friday that starving the local government areas of funds could lead to anarchy.
“The local council areas need money to run the affairs of government. You cannot starve them of funds in any way because it can lead to the breakdown of law and order.
“When you withhold money meant for the running of the affairs of the government, then you are calling for anarchy, so this simply means there is no power in the federal government or state government to withhold LG funds as pronounced by the Supreme Court.”
Prof Mike Ozekhome, Senior Advocate of Nigeria (SAN), said the court’s judgement asking the federal government to pay allocations due to local government areas directly to their account, thereby abolishing the old practices of State-Local Government Joint Account, is timely and courageous.
According to him, what the judgement has done is more like interpreting Section 162 of the Constitution, which provides for a joint State-Local Government Account.
“In this case, money is normally paid to state governors’ accounts and then for them to disburse to the local governments for them to share. But what has been happening is that, as I noted in 2020, over three years ago, the state governors have been behaving like bandits, waylaying local governments’ funds along the way and thus impoverishing them, leaving them with nothing to work, just a little for salary, and nothing to actually work for the people whom they represent.
Former president of the Nigerian Bar Association, Chief Olisa Agbakoba (SAN) described the judgement as a landmark decision that will free the local governments from the undue influences of the governors.
Agbakoba said, “It’s a landmark decision that frees the constitutionally prescribed local government from the stranglehold of their state governors. One can only hope that the financial autonomy granted to local governments will be used to benefit the communities.”
In his own reaction to the judgement, the immediate past Lagos State attorney-general and commissioner for justice, Moyosore Onigbajo (SAN), said the Supreme Court has done its bit by correctly re-stating and interpreting Constitutional provisions relating to the autonomy and the independence of local governments.
Onigbajo also noted that the apex court had further tightened the screws against the control of local governments’ funds by the states by mandating that LG funds be released to them directly and not through the states or any joint account.
Another senior lawyer, Olukayode Enitan (SAN), said the judgment was a step in the right direction and would enhance true federalism.
He said, “It serves to ensure accountability, and we can now hold our local government chairpersons responsible for the rot we see daily in our local communities. They won’t be able to say the governors are their problem or that they have not been given what was released.
“On the issue of caretaker committees, it’s always been known that they are a constitutional aberration. All the states where such is happening presently have to arrange for local government elections immediately.”
For his part, Abiodun Olatunji (SAN) described the apex court verdict as a watershed moment in the development of Nigerian constitutional democracy.
Olatunji said the decision marks a significant shift in the relationship between state and local government administrations. “The judgement will enhance transparency, accountability, and development at the grassroots level.
“The decision effectively curtails state governors’ pervasive influence over local governments. This influence has often led to the manipulation and misappropriation of funds, impeding local governance and development.
“With the guaranteed flow of funds directly to local governments, significant improvements in infrastructure, social services, and overall development at the grassroots level are expected. This shift empowers local governments to address the specific needs of their communities effectively.”
A professor of Law, Gbenga Ojo, pointed out that the issue of local government funds has a chequered history.
“In AG Lagos v AG Federation, the Supreme Court held that local government funds must be passed through the state government.
“The federal government cannot pay the funds directly to the local government. This was during the regime of President Obasanjo. The federal government’s power was to allocate the money to state governments to distribute the funds to the local government.
“President Obasanjo then went to the National Assembly, which passed a law to allow the federal government to distribute the funds directly to the local government. The Attorneys General of Delta and Lagos states challenged the law, which was declared unconstitutional by the court.
“The funds of local government are a constitutional matter, and of course, the governor has no power to appoint caretaker committees to run the affairs of the local government. The chairperson and the councillors must be elected the same way the governors were elected. This is a constitutional democracy.
“Similarly, the president cannot remove the governor and appoint a caretaker to run the state. In the same way, the governor cannot appoint caretaker committees to run local government. The governors have no such powers to do so,” he said.
Constitutional lawyer Barrister Paul Omoluabi agreed with the SANs that no explicit law gives the state governors the power to withhold funds meant for LG administration.
He said, “In Nigeria, no explicit law empowers the federal government or National Assembly to withhold local government funds. In fact, the Constitution guarantees the financial autonomy of local governments.”
He also quoted Section 162(3) of the 1999 Constitution which states: “The amount standing to the credit of the local government council in the Federation Account shall be paid directly to the local government council.”
According to him, the provision ensures that local governments receive their allocations directly from the Federation Account, without interference from the federal government or state governments.
However, he said some legal provisions might be interpreted as allowing the federal government or National Assembly to withhold local government funds in certain circumstances.
“Section 162(4) of the Constitution allows the president to withhold funds from the Federation Account if a state or local government fails to comply with the provisions of the Constitution or any law enacted by the National Assembly.
“The National Assembly has the power to make laws for the “peace, order, and good government” of the Federation, which might be interpreted to include laws related to the management of public funds, including local government funds,” he stated, adding that withholding funds without constitutional authority would violate the Constitution and the principles of federalism.
Tinubu Welcomes Judgement
President Bola Tinubu has welcomed the Supreme Court of Nigeria’s decision affirming the spirit, intent, and purpose of the Constitution of the Federal Republic of Nigeria regarding the statutory rights of local governments.
In a statement by his spokesman, Ajuri Ngelale, the president stated that a fundamental challenge to the nation’s advancement over the years has been ineffective local government administration, as governance at the critical cellular level of socio-political configuration is nearly absent.
The president emphasised that the onus is now on local council leaders to ensure that the broad spectrum of Nigerians living at that level are satisfied that they benefit from people-oriented service delivery.
Former Vice President Atiku Abubakar too has welcomed the verdict, saying it’s a win for the people of Nigeria.
LP Hails Judiciary Over LG Autonomy
Similarly. the Labour Party has applauded the recent Supreme Court ruling that grants financial autonomy to local government councils across all 36 states, including the Federal Capital Territory.
“This ruling finally puts an end to the debate on whether or not local government areas, which are the closest level of government to the ordinary people, deserve some level of autonomy to address the challenges faced by the masses within their jurisdiction. With this newfound autonomy, local government areas now have the freedom to initiate and complete projects that will alleviate the suffering experienced at the grassroots level,” a statement issued by the national publicity secretary of the LP, Obiora Iffoh, said.
Former LG Boss Lauds Judgement
For his part, a former chairman of Ijebu East local government area of Ogun State, Hon. Wole Adedayo, has applauded the apex court’s decision to grant financial autonomy to the third tier of government.
Adedayo, who spoke with LEADERSHIP Friday yesterday in Abeokuta, the Ogun State capital, said the Supreme Court adjudicated upon the summary of the letter he had authored to the former governor of the state, Aremo Olusegun Osoba, which later caused a quarrel between him and the incumbent governor of the state, Prince Dapo Abiodun.
“Nigeria can never develop without an effective system of local government administration. One of the reasons for the success of any government is the availability of funds. Once these funds go directly to each local government, you’ll be amazed at the number of quality people vying for positions at the local government level,” he said.
We Will Obey Verdict — Soludo, Otu
Anambra State Governor Chukwuma Soludo has reaffirmed his commitment to conducting local government elections in the state, following the recent Supreme Court ruling on local government autonomy.
Soludo told State House correspondents that a court case has been preventing him from conducting the polls.
For his part, Cross River State Governor Bassey Otu, has expressed approval of the Supreme Court’s ruling on local government autonomy, stating that it has been received in good faith.
“Nigeria is a democratic country, and we know very well that President Tinubu and the renewed hope agenda is a democratic one. I believe that the judgment is taken in very good faith. All Nigerians should be happy about it,” he said.
50% Of Nigeria’s Problems Solved – NULGE
On its part, the national president of the National Union of Local Government Employees (NULGE), Mr Ambali Olatunji, said the Supreme Court’s ruling on local government autonomy will solve over 50 per cent of Nigeria’s problems.
Olatunji, who made this known in an interview with the News Agency of Nigeria (NAN) yesterday in Lagos, was reacting to the Supreme Court’s ruling granting LGAs financial autonomy.
Olatunji, who expressed joy at the ruling, described the feat as freedom and a new dawn for the country.
21 States Have No Elected Councils
No fewer than 21 states in the country currently have no duly elected local government councils.
The states are running the affairs of local government councils with caretaker committees appointed by state governors, contrary to the provisions of Section 7 of the 1999 Constitution, which guarantees the operation of local government by democratically elected officials.
Currently, the federal government receives 52.68 per cent, states receive 26.72 per cent, and LGs receive 20.60 per cent of the country’s monthly revenue allocated by the Revenue Mobilisation Allocation and Fiscal Commission, which is domiciled under the Presidency, and disbursed by the Federation Account Allocation Committee.
LEADERSHIP findings have revealed that the 774 Local Government Areas (LGAs) across the 36 states and the Federal Capital Territory (FCT) over the past four and have half years, (From January, 2020 to May 2024, got a total of N9.28 trillion in allocation from the Federal Account Allocation Committee (FAAC).
The highest allocation was disbursed in 2023. So far, the amount disbursed in the five months of 2024 is more than half of what was disbursed in 2023.
Federal allocation to the LGAs had risen from N1.61 trillion in 2020 to N1.63 trillion in 2021. The amount disbursed further rose to N2.04 trillion in 2022 and a total of N2.56 trillion had been disbursed in 2023.
Between January and May 2024, the 774 local governments in the country had received N1.443 trillion from the FAAC allocation, signaling that the total amount that will be disbursed this year will exceed what was disbursed last year.
LGAs FAAC Allocation
2020……………………….N1.61 trn
2021……………………….N1.63trn
2022……………………….N2.039 trn
2023……………………….N2.56trn
2024……………………….N1.443tr
Total……………………….. N9.28tr
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