By Dansu Peter The direct transfer of statutory monthly allocations to the 774 local governments has been delayed due to their failure to m...
By Dansu Peter
For January, FAAC released N860.252 billion in allocations, with N498.498 billion earmarked for state governments and N361.754 billion for local governments. However, the local governments were unable to meet the necessary administrative requirements, which resulted in the funds being transferred to state accounts instead.
Badagry Today has reported that the CBN has concluded plan to open a dedicated account for all 774 Local Governments in the nation with hope of transferring the January allocations directly to them.
A FAAC official, according to our source, explained that the January allocations had already been sent to state accounts because the councils had not submitted their bank account details in time. "If the local governments can finalize their account details swiftly, their February allocations will be disbursed directly to them," the source added.
The delay in transferring funds is tied to the councils’ failure to open the dedicated accounts with the Central Bank of Nigeria (CBN), a requirement set by the Federal Government to implement full financial autonomy for local governments. However, officials expressed optimism that the councils would soon be able to meet the requirements, signaling the commencement of their autonomy, in line with the Bola Tinubu administration's goal.
The Office of the Accountant-General of the Federation (OAGF) and other stakeholders are reportedly working to resolve the delays in meeting the Supreme Court's directive, which calls for local government autonomy. "The process of creating the accounts is holding up the implementation, but the Federal Government is committed to ensuring that local government autonomy becomes a reality," said another FAAC official.
The Federal Government has also taken steps to prevent governors from mismanaging local government funds. An Inter-Ministerial Committee, led by the Secretary to the Government of the Federation (SGF), Senator George Akume, is developing a framework to enforce the Supreme Court ruling. This framework would allow the Accountant-General of the Federation (AGF) to deduct funds designated for primary education, healthcare, and other local government responsibilities directly from FAAC allocations and release them to the relevant agencies.
The AGF is working closely with state governments to create a template that will ensure transparency in the disbursement and use of local government funds. However, the progress of the committee's work has been slowed by the ongoing budget defense and other commitments of key government officials. Despite this, technical members of the committee continue to meet to finalize the template.
The push for local government autonomy began in May 2024, when Attorney-General of the Federation, Lateef Fagbemi (SAN), filed a case in the Supreme Court to stop governors from unlawfully dissolving democratically elected council officials and to ensure local government funds are paid directly to the councils, bypassing state governments.
The Supreme Court's landmark ruling on July 11, 2024, granted local governments financial autonomy, a decision aimed at curbing governors' undue control over local government funds and promoting transparency. To implement this ruling, the Federal Government directed all local governments to open accounts with the CBN to receive direct monthly allocations.
Bello Lawal Yandaki, the national president of the Association of Local Governments of Nigeria (ALGON), reassured stakeholders that the delay in opening accounts was due to procedural issues, not concerns over the autonomy plan. He added that the CBN was ready to open local government accounts once directives from the Federal Government were received, which could be completed within 24 to 48 hours for each state. Once the accounts are operational and the required details submitted, the direct disbursement of funds will proceed.
Source: The Nation
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