Victory For LGs’ Fiscal Autonomy

Justice Inyang Ekwo’s ruling on the suit filed by Nigerian Governors about management of the finances of local government is to all intent and purposes, significant and deserving of the accolades of all well-meaning Nigerians.

In that ruling, which expectedly excites most Nigerians, Ekwo dismissed the governors’ opposition to the Nigerian Financial Intelligence Unit (NFIU) guidelines.

NFIU had issued a guideline that provides that state and local government joint accounts be operated solely as transit accounts from which funds will be distributed directly to the accounts of the local governments. Financial institutions were directed to ensure the full implementation of the guidelines with effect from June 1, 2019.

In 2019, the Nigerian Governors Forum (NGF) approached the Court seeking to stop the implementation of the NFIU’s guidelines, a plea that was rejected by Justice Ekwo’s ruling.

Without any iota of doubt, the guideline, which seeks to entrench financial transparency in government transactions at the local level, is deserving of full enforcement.

Most Nigerians are not in any way surprised that the governors who have used the instrumentality of the local government joint account to not only starve the council areas of funds, but to expend monies belonging to the third tier of government on their own whims and caprices, are opposed to the NFIU guideline.

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Although the framers of the nation’s constitution designed the council areas to serve as the third tier of government. But the governors, using their undue and overbearing influence, rendered the local government areas ineffective.

Fundamentally, the council areas in most states of the federation, are in chains and deprived of the needed financial autonomy that would have enabled them function effectively as the government closest to the people.

Starved of the needed funds even though monies are allocated to them every month from the federation account, council areas have become invariably a mere shadow of what they are designed to be.

Essentially, the sheer lack of financial autonomy has crippled governance at the grassroots level.

Undoubtedly, the need to address this seeming imbalance necessitated the agitation for autonomy to local governments. Although the bill seeking to grant council areas full financial autonomy is still pending at the state legislative houses, Nigerians appear unanimous in their call for autonomous council areas.

In our considered opinion, the judgement by Justice Ekwo is plausible just as the NFIU guidelines which form the crux of the judgement is commendable. Council areas must be allowed to determine how monies accruing to them from the federation account are expended.

We are aware of the concerns that full financial autonomy for council areas could breed abuse and financial recklessness on the side of the executives at that level. That is why the nation has anti-graft agencies like the Economic and Financial Crimes Commission-EFCC- and the Independent Corrupt Practices Commission-ICPC, to fully monitor those entrusted with such funds.

But fundamentally, beyond the clamour for financial autonomy for the council areas, there is an over-aching need to radically address the recruitment process for leadership at the local government levels. How do chairmen and councilors emerge? What is the level of capacity of those who often emerge and entrusted with leadership at this level?

There is no contesting the fact that governors, in a desperate bid to perpetuate their control of council areas, literally handpick those who get ‘elected’ through the usual charade coordinated by state independent electoral commission-SIEC-, as chairmen and councilors. As should be expected, those who emerged as leaders at this level are pliable tools of the governors.

To address this, we have, on several occasions, advocated the scrapping of SIECs. Instead, local government elections should be conducted by INEC because only that can guarantee the emergence of competent, independent minded leaders at the local government levels.

What currently obtains as far as leadership at the local government levels is concerned, would not enable the third tier of government to function effectively. How many councilors even know what their duties are? Are they equipped enough to demand leadership from the chairman? Do they even know they have what it takes to impeach the chairman if and when necessary?

While financial autonomy is the first step to repositioning the council areas, concerted efforts must be made to radically change the leadership recruitment process; equip the legislative arm at the local level and ultimately ensure anti-graft agencies beam the needed searchlight on how the councils expend their finances.