Despite a landmark Supreme Court ruling in July 2024 affirming the financial autonomy of Nigeria’s 774 Local Government Areas (LGAs), the flow of funds from the Federation Accounts Allocation Committee (FAAC) continues to be routed through state government accounts. Between July and December 2024, approximately N2.08 trillion intended for LGAs was paid into state coffers, contrary to the court’s directive. This development raises significant questions about the Nigerian government’s commitment to upholding judicial rulings and promoting local governance reform.
The Supreme Court Ruling: Context and Implications
The July 2024 Supreme Court judgment, delivered by Justice Emmanuel Agim, categorically declared it unconstitutional for state governments to control funds allocated to local governments. The judgment emphasized that local governments should receive and manage their funds independently, free from state interference. This ruling was expected to end the controversial Joint Account Allocation Committee (JAAC) system, which many critics argue allows governors to wield undue control over local government resources.
By establishing that local government councils must be democratically elected and financially autonomous, the court’s ruling aimed to empower grassroots governance and ensure that allocations were directly applied to local development needs.
FAAC Allocations: Following the Money
Between July and December 2024, FAAC disbursed a total of N8.351 trillion in revenue to the three tiers of government—Federal, State, and Local. Of this amount, N2.08 trillion was allocated to LGAs. However, instead of being paid directly to local government accounts as mandated by the Supreme Court, the funds were funneled through state government accounts.
The monthly breakdown of allocations to LGAs highlights a steady increase in funds over the six-month period:
- July 2024: N337.02 billion
- August 2024: N343.70 billion (2% increase from July)
- September 2024: N306.53 billion (10.1% decrease from August)
- October 2024: N329.86 billion (7.6% increase from September)
- November 2024: N355.62 billion (7.8% increase from October)
- December 2024: N402.55 billion (13.2% increase from November)
Total LGA allocations for this period stood at N2.075 trillion, representing 24.9% of the total distributable revenue for the six months.
Challenges to Implementation and Stakeholder Reactions
The Federal Government’s inability to enforce the Supreme Court’s directive has been attributed to “practical impediments.” According to Finance Minister Wale Edun, a committee has been set up to evaluate the feasibility of implementing direct payments to LGAs.
However, critics, including the Association of Local Governments of Nigeria (ALGON) and the Nigeria Union of Local Government Employees (NULGE), have dismissed these explanations as insufficient. ALGON’s Secretary-General, Mohammed Abubakar, lamented that “people who don’t want this LG autonomy to work are having a field day.” The concerns raised by state governors—including claims that LGA funds are insufficient to cover salaries and loans incurred on their behalf—have been seen as tactics to delay implementation.
According to Punch Newspaper, the reaction from LGA officials and local government employees has been one of frustration and disappointment. Bayo Adefesobi, Ogun State Chairman of NULGE, placed the blame squarely on the Federal Government for failing to enforce its own policy. Meanwhile, former local government chairmen, like Francis Famurewa of Atakumosa West LGA, described the current system as one in which local councils operate as “appendages of the state.”
The Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), has issued a warning to governors disobeying the court order, threatening to file contempt charges against them. This has done little to accelerate implementation, as state governments maintain control of the funds.
Local Government Autonomy Means Little Without Financial Autonomy
The continued payment of LGA funds to state governments undermines the principle of local government autonomy. Without financial independence, local governments remain unable to execute development projects or address local needs effectively. This control also erodes democratic governance at the local level, as state-appointed caretaker committees are often used to control LGA administration.
The Federal Government’s reluctance to enforce the court ruling raises broader concerns about the rule of law in Nigeria. The implications extend beyond local governance to the credibility of the judiciary. If Supreme Court rulings can be disregarded with impunity, it sets a dangerous precedent for other sectors of governance and undermines the confidence of citizens in Nigeria’s legal system.
Looking Ahead
Six months after the Supreme Court’s ruling, the promised reform of local government funding remains stalled. While the Federal Government’s committee deliberates on the “practical impediments” to implementation, local governments, ALGON, and NULGE continue to push for direct payment of allocations.
The Federal Government must demonstrate its commitment to reform by enforcing compliance with the Supreme Court’s decision. A firm stance against state-level interference is necessary if Nigeria’s local government system is to function as an independent and effective tier of government. Failure to do so risks further disillusionment with governance structures, weakened accountability, and the perpetuation of financial opacity at the state level.
If the Federal Government does not act decisively, the push for true local government autonomy may remain an unfulfilled promise, and Nigeria’s local councils will continue to struggle under the control of state governors. This is a critical moment to determine whether judicial rulings carry real weight or if they remain mere advisory opinions in the face of political expediency.