The Association of Local Governments of Nigeria has called for an amendment to the law that established the Federal Allocation Committee to ensure the inclusion of local governments in discussions regarding the sharing formula for revenues allocated to the three tiers of government.
According to ALGON, local governments are currently excluded from meetings where decisions about the distribution of federal funds are made.
The Secretary General of ALGON, Muhammed Abubakar, made this known in an interview, urging for the necessary legal changes.
Abubakar emphasised that local government chairmen should have a seat at the table during these critical discussions.
“We have FAAC where money is being discussed. Fine, we are saying that local government chairmen also have the right to be represented in that body,” he said.
He further noted that state governors and commissioners of finance are aligned with ALGON on the matter of opening commercial bank accounts for local governments, enabling them to receive allocations directly from FAAC.
“The governors and state commissioners of finance are on the same page with us on the opening of accounts in commercial banks,” he said.
Addressing the ongoing exclusion of local governments, Abubakar explained, “Those are the areas the governors and commissioners are saying no to because we have held meetings with the Commissioners of Finance and they are saying no to the fact that they’ll never allow local government to be on the table where their money will be shared. And when we probed them further, they said the Act that created FAAC never allowed the LGs to be part of the meeting. It’s an Act, and it can be amended.”
The push for local government inclusion in the FAAC process comes in the wake of a July 11, 2024, Supreme Court ruling, which ordered that local government allocations must be paid directly to the councils, as requested by the Attorney General of the Federation, Lateef Fagbemi (SAN).
The lawsuit filed by Fagbemi on behalf of the Federal Government sought to grant full autonomy and direct funding to all 774 local government councils in Nigeria.
“In this case, since payment through states has not worked, the justice of this matter demands that LG allocations from the federation account should henceforth be paid directly to the LGs,” the court ruled.
Despite the ruling, local government autonomy has yet to be fully implemented nearly eight months after the Supreme Court judgment.
Reports indicate that the Central Bank of Nigeria has required all 774 councils to provide at least two years of audited financial reports before they can begin receiving their allocations directly.
The CBN has insisted that local governments meet this condition before opening accounts for direct remittance of their allocations.