• Expert tasks FG on financial guidelines, accountability
• EFCC, ICPC, CSOs, others may grapple with widened dragnets
• Lack of capacity, trained staff threaten fiscal undertakings
• Ex-ALGON president, others, okay officials on transparency, funds management
• Former LG boss allays concerns, says better days ahead
• ‘Why FG must prioritise teachers, health workers’ salaries’
As Nigeria’s 774 local government areas (LGs) prepare to receive direct funding from the Federal Government, questions have been raised about the capacity of council chairmen and the institutional framework to uphold accountability and transparency, which remain notably deficient at the local government level.
These concerns are further compounded by weak democratic oversight of public institutions, which undermines efforts to combat corruption, curtail abuse of power, and rebuild public trust in governance.
The concerns stem from the fact that LGs have over the years had their affairs mostly handled by the states with minimal responsibilities performed by many. Similarly, governance structures are missing in the LGs with legislative arms that are not operational.
Also, under the new minimum wage regime, there are concerns about the capacity of the LGs to implement the state-wide decisions, despite poor revenue generation in many LGs due to weak economic activities, insecurity and parlous infrastructure.
There are fears that LGs could regress to the pre-1999 era, when they struggled to pay salaries of primary school teachers and workers at Primary Health Centres (PHCs).
The Guardian investigation revealed that unless local government laws, rules, and regulations are revised in line with the Supreme Court judgment granting financial autonomy to LGs, their finances will likely remain under the control of state governors and political godfathers.
While state Houses of Assembly perform oversight functions over LGs, the operational rules and regulations of local councils are largely dictated by governors through the supervising ministries. These ministries set procurement guidelines, define spending limits for council chairmen, and regulate the management of council funds. They also stipulate the responsibilities of councillors.
Former Chairman of Ijebu East Local Government in Ogun State, Mr Wale Adedayo, told The Guardian that only the Lagos State House of Assembly has begun reviewing its local government administrative laws to align with current realities and address loopholes in fund administration. He urged other states to follow suit.
To avoid a repeat of the pre-1999 crisis, when LG workers were owed salaries for nearly four years, Adedayo also called on the Federal Government to instruct the Central Bank of Nigeria (CBN) to prioritise the payment of salaries and emoluments for primary school teachers, health workers, and cooperative deductions as a first-line charge, ensuring these are paid into separate accounts.
Meanwhile, the National Assembly is grappling with the challenge of amending the Constitution to delete Section 162(6), which established the states/local government joint account (JAAC). This move is necessary to implement the Supreme Court’s ruling on financial autonomy.
However, The Guardian learnt that the National Assembly has hesitated to act on deleting JAAC from the Constitution, as neither the Presidency nor the 36 state governors have reached an agreement on the implementation of the apex court’s judgment. Over the past year, the Federation Account Allocation Committee (FAAC) paid N3.774 trillion into the JAAC controlled by state governors, while LGs received N9.56 trillion between 2019 and 2023.
As the country enters a new era of local government funding, a public financial management expert and former Ogun State Commissioner for Finance, Mr Kehinde Shogunle, called on the Federal Government to establish financial guidelines to monitor LG expenditure, ensuring public accountability and transparency.
Shogunle, a former Director-General of Budget and Management in Ogun State, noted that for nearly three decades, there have been no significant demands from local governments due to a paucity of funds and the overbearing control of governors. He explained that most local governments lack the political capacity and properly trained civil servants needed to ensure transparency in public financing.
He said, “For many years, LGs have been receiving meagre allocations from state governors, barely enough to pay salaries, with very little left for capital projects. This made them unaccountable, but that has to change now. There is an office of the Auditor-General for Local Governments, which must now rise to the occasion. I am aware that the State House of Assembly is empowered by the 1999 Constitution to audit their books.
“I think all hands should be on deck to demand regular financial reporting and to encourage Civil Society Organisations (CSOs) to monitor their finances, just as the EFCC and ICPC must also focus their attention on them.”
This “focus” is expected to engender a huge logistical challenge for watchdogs as they firm up their dragnets across the 774 local government areas.
Prof Remi Aiyede, a political science lecturer at the University of Ibadan (UI), warned that without proper oversight, granting financial autonomy to local governments could lead to the “decentralisation of corruption.”
The Founder of the Centre LSD, Dr Otive Igbuzor, noted that accountability at the local level requires robust internal systems. He said, “Every local government must have an internal system for budgeting, procurement, and financial guidelines that must be strictly adhered to.” He further highlighted the need for councillors to provide effective legislative oversight and called on anti-corruption agencies to take a more active interest in local council activities.
However, the immediate past President of the Association of Local Governments of Nigeria (ALGON), Kolade Alabi, refuted claims that local government chairmen lack the capacity to manage funds and ensure transparency.
He said, “Nigerians should welcome this new dispensation in local governments, as it will lead to numerous developmental projects at the grassroots any moment from now.”
Alabi noted that people at the local level have endured enough hardship and should commend President Bola Tinubu for initiating the move towards granting financial autonomy to LGs. He urged citizens to look forward to the commissioning of several projects by local councils.
Alabi, who also chairs ALGON in Lagos State, assured Nigerians that adequate institutions and structures exist to monitor the income and expenditure of LGs. He warned that any chairman who misappropriates or diverts public funds would face the full weight of the law.
Similarly, former ALGON Chairman in Oyo State, Abbas Aleshinloye, told The Guardian that with financial autonomy now granted to LGs, governors should no longer impose spending limits or regulate council expenditures. He argued that such regulations tied local councils to undue control and influence from state governors.
Speaking on accountability structures, former Ijebu East Local Government Chairman, Mr Wale Adedayo, pointed out that the administrative framework at the state level is mirrored in the LGs.
He explained, “Apart from the chairman, there is a Treasurer or Director of Finance and a Head of Local Government Administration (HOLGA), equivalent to the Head of Service at the state and federal levels. These individuals are signatories to LG accounts. Additionally, there is an Auditor-General responsible for reviewing their financial records and a local government committee at the State House of Assembly overseeing their finances and activities.”
Adedayo dismissed concerns that councillors lack the training to approve and monitor council budgets. He urged Nigerians to remain optimistic, assuring them that better days are ahead for grassroots governance.
Concerns have grown over the lack of visible action regarding the commitment expressed by the Senate President, Godswill Akpabio, to enforce the Supreme Court’s judgment on local government autonomy.
Akpabio had indicated that Section 162, Subsection 6 of the 1999 Constitution, which established the State/Local Government Joint Account, must be amended to facilitate the full implementation of the judgment.
Although the Chairman of the Senate Committee on Constitution Review, Jibrin Barau, who also serves as the Deputy Senate President, introduced a motion in the Senate on the need for legislative measures to enforce the Supreme Court’s judgment, no concrete steps have been taken.
As debates on the enforcement of the judgment intensify, the Federal Government, through the Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), issued a stern warning last month to state governors refusing to comply with the Supreme Court’s decision. He threatened to file contempt of court suits if the defiance continues.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, provided explanations for the delay in implementing the apex court’s judgment. He attributed the delay to “practical impediments” and revealed that the Federal Government had set up a committee to assess the practicability of the judgment.
Opposition to the judgment remains strong among governors, as confirmed by Oyo State Governor, Seyi Makinde, who voiced his concerns and advocated for a homegrown solution to avoid negative impacts on the people.
Makinde stated, “The law is the law, and when there is a conflict, we must go to court. However, it is imperative for us to seek homegrown solutions that ensure transparency and prevent our people from suffering. This is because when two elephants fight, it is the grass that suffers.”
Of greater concern is the fact that some states have reportedly passed legislation to circumvent the Supreme Court’s judgment.
Governor Chukwuma Soludo of Anambra State has signed into law the Local Government Administration Bill 2024, passed by the State House of Assembly, despite criticism from civil society groups and opposition parties.
Section 13(1) of the bill mandates the state to maintain a “State Joint Local Government Account,” into which all federal allocations to local government areas (LGAs) must be deposited. Section 14(3) further stipulates that within two working days of receiving their allocations from the Federation Account, each LGA must remit a state-determined percentage to the consolidated account, even if the funds are received directly from the Federation Account.
Additionally, Section 14(4) requires that if the state government receives LGA allocations on their behalf, it must deduct the specified percentage before disbursing the remaining funds to the LGAs.
While the new law has faced widespread criticism for compelling LGAs to pay their federal allocations into a state-controlled account, Soludo defended the legislation, warning that granting full autonomy to Nigeria’s 774 LGAs could lead to “humongous chaos.” He argued that such autonomy would not foster sustainable development.
Soludo explained that the legislation aims to promote consistency, transparency, and collaboration among the tiers of government. According to him, the new law aligns with the Supreme Court judgment and is intended to operationalise it, not undermine it.
From the House of Representatives, a member from Akwa Ibom State, Mark Esset, expressed reservations about the Supreme Court judgment, describing it as “putting the cart before the horse.”
Drawing from his experience as a former council chairperson of Nsit Atai Local Government and a former chairman of the local government and chieftaincy affairs committee in the Akwa Ibom State House of Assembly, Esset argued that the abolished state and local government joint account was a creation of the Nigerian Constitution.
He stated that the Supreme Court judgment does not grant full autonomy to LGAs because state governments and state Houses of Assembly are constitutionally mandated under Section 7 to legislate and provide a framework for the effective functioning of local governments.
Esset further clarified that the concept of the joint account for managing local government finances is addressed in Section 162 of the 1999 Constitution, which governs the financial relationship between the federal, state, and local governments.
Reacting to concerns about the competence of council chairmen in managing funds to be released to them, political scientist and former Chief of Staff to the late Governor Abiola Ajimobi, Prof Gbade Ojo, stated, “Elected council officials are assumed to be competent to handle funds. Many of them are even better educated than their governors. However, it behoves anti-corruption agencies to monitor them.”
He noted that some states may have devised informal mechanisms to ensure financial disbursements safeguard local government pensioners and primary school teachers.
Commenting on the monitoring of local government finances, the immediate past Head of the Political Science Department at Lead City University, Ibadan, Prof Akeem Amodu, explained that the responsibility lies with state Auditors-General for Local Governments, who are statutorily mandated to audit accounts and ensure compliance with financial regulations.
He highlighted the existence of Public Accounts Committees (PACs) at both state and federal levels, which review financial reports to detect irregularities.
“Besides these committees, civil society organisations (CSOs) and communities should actively participate in monitoring the expenditure and finances of LGs through transparency, advocacy, and involvement in decision-making processes,” Amodu said.
He also urged anti-corruption agencies such as the EFCC and ICPC to scrutinise local government expenditures. He recommended “real-time tracking of funds through digitised financial systems. E-government tools like e-budgeting and automated payment systems can enhance judicious allocation and transparency. Additionally, compliance with the Freedom of Information (FOI) Act will ensure LGs disclose financial records, making them accessible for public scrutiny.”
Amodu noted that the widespread corruption in local councils before 1999 remains a significant obstacle to advocating for administrative and financial autonomy for the third tier of government.
Meanwhile, a lecturer at Obafemi Awolowo University (OAU), Ile-Ife, Dr Damilola Agbalajobi, stressed the need for punitive measures to accompany the Federal Government’s direct payment to LG accounts.
She said, “Erring local council chairmen who mismanage council funds should be publicly disgraced after impeachment and removal. They must also be made to repay the misused funds, and plea bargaining should not be entertained.”
Agbalajobi emphasised the importance of bolstering citizens’ participation in grassroots administration. “With the FOI Act, citizens should have the latitude to scrutinise the finances and expenditures of the tier of government closest to them,” she added.
(Guardian)
