FG: Direct Payment of Allocation to Councils Begins Next Month | #NwokeukwuMascot

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Barring any last-minute changes, local councils will begin receiving direct allocations from the Federation Account starting next month. This will commence with the disbursement of this month’s allocation, a source revealed to our correspondent over the weekend.

The direct receipt of funds from the Federation Account Allocation Committee (FAAC) will put an end to delays in implementing the July 11 Supreme Court judgment granting financial autonomy to local councils.

Since the judgment, the Federal Government has been working to minimize disruptions to state and local government operations. However, breaking the state/local government joint account system—through which council allocations are paid—has faced subtle resistance from governors, many of whom are dissatisfied with the court’s decision.

A member of the Inter-Ministerial Committee established to enforce the judgment disclosed that approval had been granted for direct FAAC allocations to local governments starting next month after resolving outstanding issues.

The source explained that while some councils have already been receiving their allocations directly, the process will be fully operational by January 2025. However, the committee member declined to identify the councils currently benefiting from direct payments.

The source stated: “A few LGAs have already started receiving their direct allocations, but all 774 LGAs will fully start receiving theirs from January 2025.

“Our committee will reconvene in January to review progress and finalize measures before the Accountant-General of the Federation authorizes a complete rollout. This is a critical juncture in Nigeria’s governance structure.

“The January 2025 meeting will also address the actions of governors attempting to undermine the autonomy of democratically elected LGA chairmen, deputies, and councillors, ensuring they are not coerced into serving state interests.”

This move is seen as a significant step toward empowering councils to fulfill their constitutional responsibilities without undue interference from governors.

The source expressed disappointment over the suspension of democratically elected local government chairmen and deputies by the Edo State House of Assembly. This followed a petition by Governor Monday Okpebholo, accusing them of insubordination for failing to submit their financial statements as directed.

“It is highly undemocratic for governors to dissolve elected LGAs. Such actions undermine the autonomy granted to local governments and create an environment where LGAs become pawns in the hands of state executives,” the source added.

The Inter-Ministerial Committee, chaired by Secretary to the Government of the Federation (SGF) George Akume, includes members such as 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 of Nigeria (CBN) Governor Olayemi Cardoso, Revenue Mobilisation Allocation and Fiscal Commission Chairman Muhammed Shehu, and representatives of state governors and local governments.

President Bola Ahmed Tinubu has expressed strong support for the financial independence of local councils.

The committee endorsed the implementation of constitutional provisions recognizing councils as the third tier of government. Attorney-General Fagbemi had earlier threatened to initiate contempt proceedings against governors defying the Supreme Court ruling.

“Local government autonomy is meant to empower the grassroots, not enrich individuals. Any chairman found guilty of diverting funds will face severe legal consequences,” Fagbemi warned.

However, some states have introduced laws seemingly aimed at bypassing the Supreme Court judgment. For instance, the Anambra State House of Assembly passed a Local Government Administration Bill requiring LGAs to remit a portion of their allocations into a state-controlled joint account.

Governor Chukwuma Soludo defended the legislation as necessary for transparency and collaboration. However, critics, including civil society groups, accused his administration of undermining the spirit of the Supreme Court ruling.

Conversely, the Nasarawa State House of Assembly abolished joint accounts and restructured its local government system to comply with the judgment. Governor Abdullahi Sule signed the bill, signaling his support for grassroots financial independence.

As mandated by the Supreme Court, all states have conducted elections to ensure that councils are run by democratically elected officials before accessing direct allocations from the Federation Account.

The Senate has also called for full compliance with the judgment, advocating constitutional amendments to remove ambiguities in Section 162(6) of the 1999 Constitution, which created state/local government joint accounts. Senate President Godswill Akpabio emphasized the need for a clear framework to enforce local government autonomy effectively.

Immediate past National President of the Association of Local Governments of Nigeria (ALGON), Aminu Muazu Maifata, advised council chairmen to utilize direct allocations judiciously.

“I expect them to channel resources towards implementing laudable programmes and projects, as well as addressing grassroots challenges,” Maifata said.

He noted that ALGON had developed a template for councils to use their FAAC allocations effectively, emphasizing the need to tackle insecurity, water shortages, and infrastructure deficits.

“We already set the template when the Supreme Court judgment was delivered. Each chairman knows what to do if the resources are available. I expect them to follow the template and deliver good governance to the grassroots,” Maifata added.

He further urged council chairmen to invest in capacity building for both the legislative and executive arms of local governments, bringing in skilled resource persons to strengthen administration at the grassroots level.

“These are key areas I expect them to start addressing immediately,” Maifata concluded.