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FG, States Reach 3-month Agreement On LG Allocations - Politics - Nairaland

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FG, States Reach 3-month Agreement On LG Allocations by References1: 7:09am On Aug 13
The Federal Government and state governors may have agreed to a three-month moratorium on Local Government autonomy, over concerns arising from its impact on salary payments and operational viability, The PUNCH learnt on Monday.

The development means Local Governments may wait till October before the implementation of the law in the direct payment into their respective accounts.

The Supreme Court, on July 11, 2024, gave a landmark judgment affirming the financial autonomy of the 774 LGs in the country and ruled that governors could no longer control funds meant for the councils.

The apex court also directed the Accountant-General of the Federation to pay LG allocations directly to their accounts, as it declared the non-remittance of funds by the 36 states unconstitutional.

Under former President Muhammadu Buhari, the Nigerian Financial Intelligence Unit issued a regulation, effective from June 1, 2019, which banned transactions on State and Local Governments Joint Accounts. Funds were sent directly to the accounts of the local governments. It also limited cash withdrawals from local governments accounts to a maximum amount of N500,000 per day with penalties for banks that failed to comply. The Nigerian governors under the aegis of the Nigerian Governors’ Forum kicked against this regulation and the NFIU eventually capitulated.

The status quo was maintained until May 2024 when the Attorney-General of the Federation, Lateef Fagbemi (SAN), filed suit marked SC/CV/343/2024 at the Supreme Court to strengthen the autonomy of the local government areas as guaranteed by the constitution. It sought to prevent state governors from unilaterally dissolving democratically elected local government councils and establishing caretaker committees, actions that violate constitutional provisions. The AGF argued that the constitution mandates a democratically elected local government system and does not allow alternative governance structures.

The suit also prayed that the funds from the Federation Account be channelled directly to local governments, bypassing the allegedly unlawful joint accounts managed by state governors. The Federal Government also sought an injunction to stop governors and their agents from receiving or spending local government funds without a democratically elected local government system in place. It contended that the governors’ failure to establish such a system constitutes a deliberate subversion of the 1999 Constitution. The Supreme Court heard parties to the case on June 13, with the state governments, through their respective attorneys-general, opposing the suit.

That was the prelude to the Supreme Court judgment of last Thursday, July 11, 2024, which has now affirmed the financial autonomy of Nigeria’s 774 local governments. In the unanimous judgment of its seven-member panel, the Supreme Court upheld the suit brought by the federal government to strengthen the independence of local governments in the country.

A member of the panel, Emmanuel Agim, who delivered the court’s lead judgment, held that the local governments across the country should henceforth receive their allocations directly from the Accountant-General of the Federation. He ruled that it is illegal and unconstitutional for governors to receive and withhold funds allocated to local government areas in their states.

Many Nigerians, including the LG chairmen, hailed the judgment of the Supreme Court, describing it as a step in the right direction to restructure the country.

Although some governors voiced their concerns, the Nigeria Governors’ Forum, speaking through the chairman and Kwara State Governor, AbdulRahman AbdulRazaq, said the judgment was a relief from the financial burden to state governments.

AbdulRazaq, speaking to journalists after meeting President Bola Tinubu on July 12, a day after the judgment, said, “The governors are happy with the devolution of power regarding local government autonomy. The public really doesn’t know how much states spend on bailing out local governments.”

PUNCH findings
However, The PUNCH observed that more than a month after the judgment, the order of the apex court had not been complied with.

In July 2024, total disbursements by the Federation Allocation Account Committee increased to N1.354tn, with LGs receiving N337.019bn.

At the July meeting of FAAC, chaired by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, of the total amount shared to the three tiers of government, the Federal Government received N459.776bn, the states received N461.979bn, the LGs got N337.019bn, while the oil-producing states received N95.598bn as derivation (13 per cent of mineral revenue).

The Association of Local Governments of Nigeria, however, waited in vain to get the money paid directly into the LG accounts.

The Incorporated Trustees of ALGON accused the state commissioners of finance of conspiring with governors to obstruct the direct payment of allocations from the federation account to the 774 LGs’ accounts.

In a letter addressed to the Chairman of the Forum of State Commissioners of Finance in Nigeria, dated July 30, 2024, and signed by its counsel, Mike Ozekhome (SAN), ALGON threatened to initiate contempt proceedings against the commissioners if they failed to comply with the Supreme Court order.

Ozekhome stated in the letter that his clients’ enthusiasm over the apex court decision had been thwarted by the finance commissioners committee.

Though another faction of ALGON, led by Aminu Maifata, denied issuing a legal threat against the commissioners’ committee, Ozekhome insisted that he was briefed by the ALGON Board of Trustees in a letter signed by the Secretary-General of the board, Mohammed Abubakar.

The PUNCH reported July 25 that the Federal Government confirmed that it had not yet commenced direct payment of the monthly allocations to the 774 Local Government Areas.

Edun attributed the delay to the proceedings of the Supreme Court, which had not been communicated to the Attorney General of the Federation for proper study and implementation.

He said the process was still in its early stages, adding that further steps would be taken once the full details were available.

The minister said the Federal Government was yet to commence direct payment to the respective LGs due to some “practical impediments” and added that a committee had been set up by the FG to look at the practicability of the judgment.

The PUNCH gathered on Monday that the “practical impediments” were creating challenges for the implementation of the Supreme Court judgment on LG autonomy.

The Federal Government, it was learnt, faced challenges implementing the ruling on local government financial autonomy, with concerns over its impact on salary payments and operational viability.

The Oyo State Governor, Seyi Makinde, who raised concerns over the judgment, called for a homegrown solution to ensure the people did not suffer.

“The law is the law and when there is a conflict, yes, we should go to the court. But it behoves us to look for our own homegrown solutions that can ensure that we have transparency and that our people do not suffer. This is because when two elephants are fighting, it is the grass that will suffer,” Makinde was quoted to have said.

Also, The PUNCH reported that the National President of ALGON, Aminu Mu’azu-Maifata, called for an increase in the monthly allocation to the 774 LGAs to enable them pay the new minimum wage.

Speaking at a press briefing in Lafia, Nasarawa State, recently, Mu’azu-Maifata said, “Once the new minimum wage is enacted by the National Assembly and becomes a law, every council chairman must obey.

“But how to obey such a law is what we will look into. By sourcing funds to pay salaries, we are also going to find ways to attract and harmonise resources so that we will not default.”

Multiple sources close to the NGF and the Federal Government, speaking exclusively with The PUNCH on Monday, said the Federal Government was in a fix on how to proceed with the implementation of the judgment on the financial autonomy for Local Government Areas.

“From what I know from the Nigeria Governors’ Forum, the Federal Government and the states are looking for a political solution to manage the fallout of the Supreme Court judgment.

“The first step is the three-month moratorium on the judgment. For the next three months, the LG allocation will still be paid into the joint account with the respective states, while a permanent solution that will serve the objectives of financial autonomy as envisaged by the Supreme Court judgment is worked out,” one of the sources told The PUNCH.

He added, “The governors are happy that the judgment came eventually, as it would relieve them of the burden of having to augment monthly FAAC allocation of the LGs to be able to pay local government staff, primary school teachers, and primary health workers, among others.

“However, they are apprehensive that we may go back to the early 1990 era when primary school teachers and other local government members of staff were owed salaries for an average of 12 to 24 months.”

The source expressed the concerns of the governors that only a few local government areas in the country could actually survive and pay bills conveniently from FAAC allocation and internally generated revenue.

“The issue of financial autonomy per the Supreme Court judgment is not as rosy as it looks. Only a few local governments in Lagos, Rivers, Kano, and the Federal Capital Territory can comfortably cover their expenses using only monthly FAAC allocations and their IGR.

“For other states, governors augment their allocation with state funds to be able to pay salaries. That is why the salary of primary school teachers and primary health workers, which are the responsibilities of LGs, is taken as first line charge through the joint account with the state.

“It is clear to both the Federal Government and the governors that there will be a problem with the Supreme Court judgment and the local governments will be rocked by industrial action by workers,” he added.

When reached on Monday by The PUNCH, Ozekhome said he had only seen the alleged agreement between the Federal Government and the states regarding the delay of the LG autonomy implementation on the pages of newspapers.

He said his client, ALGON, did not give him such information.

The constitutional lawyer said he was also not aware that the July allocation for LGs had been paid to the finance commissioners in states.

“If that were done, it would be a frontal attack on the valid and subsisting judgment of the apex court and there are serious legal consequences for such indiscretion,” Ozekhome said.

He added that there was no ultimatum given by ALGON through his chambers for the initiation of contempt proceedings against the finance commissioners of the 36 states of the federation if they did not pay the allocation to the 774 LGs immediately.

Efforts to reach the Minister of Justice and Attorney-General of the Federation, Lateef Fagbemi (SAN), through his spokesperson, Kamarudeen Ogundele, on the AGF’s position on the LGs July allocation paid to state finance commissioners, contrary to the Supreme Court Judgment, proved abortive as he didn’t pick his calls or respond to messages sent to his phone as of the time of filing this report.

Also, attempts to reach the Ministry of Finance for comments were futile as the Director of Press, Mohammed Manga, didn’t respond to phone calls made to his line.

LGs confirmation
Chairperson, National Union of Local Government Employees, Akwa Ibom State chapter, Mrs Anestina Iweh, on Monday, confirmed that the July allocation of the 774 LGAs was sent to state commissioners of finance in the respective states.

Iweh, who spoke with one of our correspondents in Uyo, the Akwa Ibom State capital, said the allocation was paid to the commissioners because the FG had yet to get to get the account details of the 774 LGAs.

“The Federal Government does not have the account details of the 774 LGAs. They have not done anything, no procedure, no process, even up till date, to update the account details of the 774 LGAs.

“We can’t keep quiet and allow workers to stay without salaries, so money must come for salaries to be paid. If they are ready to act according to the Supreme Court judgement, they will get account details of the 774 LGAs and do the needful.”

However, the Chairman of Kwami Local Government Area of Gombe State, Dr Wali Ahmed, justified the disbursement of the July allocation to the commissioners, saying there was a 90-day window for the implementation of the judgment.

Ahmed confirmed that the councils had been told to update their account details with the Treasury Single Account.

Speaking in a telephone chat with one of our correspondents on the supposed illegality of disbursement to states’ accounts, Ahmed said, “They wrote a letter that within 90 days, all LG signatories should ensure they link their accounts with TSA. So, it’s not yet over.”

In Plateau State, an LG boss, who spoke on condition of anonymity, confirmed that the FG gave a three-month period before the implementation of the judgement.

“Don’t forget that after the Supreme Court judgement, the Federal Government passed a circular giving a three-month window before the commencement of the implementation. As it is, the period has not elapsed and so there is no cause for alarm,” our source said.

“We at the local government areas are not complaining that our monthly allocations are still channeled through the state government. We receive the allocations due to us as LGs. I don’t know of other LGs but we in Plateau are receiving ours accordingly and the state government does not tamper with it.”

The PUNCH gathered on Monday that all the members of the executive councils of the LGs from Katsina State had relocated to Abuja, though it was not clear who they went to meet as a follow-up to the LG autonomy.

Another LG chairman in Katsina State, who spoke on condition of anonymity, said all chairmen, together with the state ALGON chairman, Bello Kaita, were in Abuja for a meeting on Monday.

“We are all here in Abuja to push for our autonomy, because the Supreme Court judgement ought to be respected, but you see, even the Federal Government allocation was not given, let alone our legal mandate of a four-year tenure. So, we are in Abuja for the issues.”

Efforts to speak with the ALGON chairman, Kaita, were unsuccessful as his telephone number was not connecting as of the time of filing this report.

‘Court ruling belated’
In another twist, the Adamawa State Commissioner for Finance, Mrs. Augustina Wandamihya, described the Supreme Court judgement as “belated”, saying LG autonomy had long been implemented by the state.

The commissioner told The PUNCH on Monday that Governor Ahmadu Fintiri, in his policy of transparency and accountability, granted local government autonomy during his first tenure in office.

“Since Governor Fintiri took over the mantle of leadership he granted autonomy to the 21 local governments in the state. All the local governments since then get their Federal Government allocation directly, their monies don’t come through the state account,” Wandamihya said.

“If this interview was in the office, I would have shown you all the documents. So, in Adamawa State, the Supreme Court judgement was belated.”

Also speaking on the issue, the state Secretary of ALGON and Chairman, Song Local Government Area, Alhaji Idris Yahaya, said confirmed that the July allocation came directly to his council account.

“Our governor, because of his transparency and his interest for the people at the grassroots, granted local government autonomy long before we came into office,” he stated.

Yahaya said the autonomy had brought rapid development to the grassroots following the financial freedom of councils in the state.

He urged other governors in the country to emulate Fintiri and grant local governments autonomy for speedy development at the grassroots.
https://punchng.com/fg-govs-reach-three-month-agreement-on-lg-allocations/

3 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by izombie(m): 7:11am On Aug 13
Op shorten this shyt

6 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by helinues: 7:12am On Aug 13
Toh
Re: FG, States Reach 3-month Agreement On LG Allocations by fergie001: 7:13am On Aug 13
When I said it here that FG cannot withhold July allocations.

Paraman, press9jatv & dapadawee no gree.

This 3 months sef is till Dec, you guys don't know our Governors @ all.

20 Likes 1 Share

Re: FG, States Reach 3-month Agreement On LG Allocations by Biodun556(m): 7:13am On Aug 13
Please stop local government autonomy in Lagos

The lagos state government is doing extremely well to local government administration. Prompt payment of salaries, quality roads and other projects etc

Before Lagos state stop complete local government autonomy. The local government was a disaster in the state. They owe salaries and embark poor quality projects, they borrow money anyhow, workers protest hear and their

Please Lagos state should be excluded from local government autonomy ejo o!
Re: FG, States Reach 3-month Agreement On LG Allocations by oluwaseyi0: 7:29am On Aug 13
What's wrong with this governors
Re: FG, States Reach 3-month Agreement On LG Allocations by Meti99(m): 7:30am On Aug 13
Nigeria is already regaining her dignity and shall soon become the paperweight Africa's biggest economy..
On your manhood we are standing bola

1 Like

Re: FG, States Reach 3-month Agreement On LG Allocations by Yankee101: 7:30am On Aug 13
Tinubu wants to chop alone and they’re not happy
Re: FG, States Reach 3-month Agreement On LG Allocations by Zainabwhitemone(m): 7:31am On Aug 13
Re: FG, States Reach 3-month Agreement On LG Allocations by MarveworldG: 7:33am On Aug 13
Noted
Re: FG, States Reach 3-month Agreement On LG Allocations by free2ryhme: 7:34am On Aug 13
Re: FG, States Reach 3-month Agreement On LG Allocations by alfredo4u(m): 7:34am On Aug 13
Can someone summarize for us..,..


Live and let's live
Re: FG, States Reach 3-month Agreement On LG Allocations by Amucha: 7:35am On Aug 13
FG and State government agreed to disobey court order and to encourage illegally?

3 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by Ikaeniyan0: 7:35am On Aug 13
I hope the national assembly would have passed a law that will put an end to the states electoral body to hold local government elections.

2 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by BuharisBoy: 7:37am On Aug 13
INEC: next should be only national INEC can conduct LG polls
Re: FG, States Reach 3-month Agreement On LG Allocations by yoruboid: 7:37am On Aug 13
givedemwotowoto:


You rushed to the SC to pepper state governors. The state governors have now been peppered at you wanted, but now you're not ready to obey the court order.

You didn't think about reality before you started fighting?

The same way these Agbado urchins and riffraffs start their hate filled tribal bigotry, forgetting there will be consequences

You’re dull

The FG could have implemented it right away but states like Abia still making deductions from people’s 18k minimum wage will not be able handle the shock

Abia still pays 18k years after the minimum wage became 30k and still yet they deduct. How will they handle 70k after the LGA allocations have been taken from them?

It’s to enable the states plan but as usual you must display your ignorance

Once again you’re dull

28 Likes 1 Share

Re: FG, States Reach 3-month Agreement On LG Allocations by Samtob90(m): 7:38am On Aug 13
givedemwotowoto:


You rushed to the SC to pepper state governors. The state governors have now been peppered at you wanted, but now you're not ready to obey the court order.

You didn't think about reality before you started fighting?

The same way these Agbado urchins and riffraffs start their hate filled tribal bigotry, forgetting there will be consequences
Ode

3 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by Gohs: 7:39am On Aug 13
Someone should pass this message to House of representatives & Senators.

National Assembly MUST amend the Electoral Act once again.

They must INSIST that only results visible on the Online INEC Viewing Portal (IREV) can be announced and added up.

Otherwise INEC will continue to cook up results to keep APC in power.

This present Electoral Law is DOOM for Nigerians. . .
We have to change it if we want to kick APC out.

3 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by phemmie06(m): 7:39am On Aug 13
cry
Re: FG, States Reach 3-month Agreement On LG Allocations by NapoleonHill: 7:40am On Aug 13
givedemwotowoto:


You rushed to the SC to pepper state governors. The state governors have now been peppered at you wanted, but now you're not ready to obey the court order.

You didn't think about reality before you started fighting?

The same way these Agbado urchins and riffraffs start their hate filled tribal bigotry, forgetting there will be consequences

This is wack thinking. We don't all like the guy but you think going to the supreme court was all about peppering state governors?


So the fed. government should just implement the ruling without proper planning and cause a system shock that can affect many Nigeria?

Bros, think this thing through again and ask yourself if it makes sense.

1 Like

Re: FG, States Reach 3-month Agreement On LG Allocations by Nahunger(m): 7:41am On Aug 13
grin
Re: FG, States Reach 3-month Agreement On LG Allocations by fredoooooo: 7:42am On Aug 13
The governors are bunch of thieves and criminals .
These are the people Nigerians need to protest and attack.. they're o e of the cancers in our rotten political system ..

23 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by Tjra: 7:42am On Aug 13
givedemwotowoto:


You rushed to the SC to pepper state governors. The state governors have now been peppered at you wanted, but now you're not ready to obey the court order.

You didn't think about reality before you started fighting?

The same way these Agbado urchins and riffraffs start their hate filled tribal bigotry, forgetting there will be consequences
This is dumbest shit I've read on Nairaland this month of August.

In your attempt to talk smartly, you ended up doing the opposite.

2 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by iwaeda: 7:42am On Aug 13
References1:

https://punchng.com/fg-govs-reach-three-month-agreement-on-lg-allocations/
Tinubu stylistlisly trying to reverse this law, because Governors are muzzling him already. Some of his louts will be here to defend him as usual. grin grin grin grin grin cry cry

2 Likes

Re: FG, States Reach 3-month Agreement On LG Allocations by givedemwotowoto: 7:42am On Aug 13
NapoleonHill:


This is wack thinking. We don't all like the guy but you think it was all about peppering state governors.


So the fed. government should just implement the ruling with proper planning and cause a system shock that can affect many Nigeria?

Bros, think this thing through again and ask yourself if it makes sense.

The SC order barred FG from sending LG money to state governors AGAIN. That judgement was clear enough. You shouldn't refuse to obey SC order at your discretion, should you?

1 Like

Re: FG, States Reach 3-month Agreement On LG Allocations by olowo1930: 7:45am On Aug 13
We have never ready to develop this country. Modifying SC judgement to the benefits of greater politicians. Well, I don't expect anything good from this administration. God we hope on your kingdom. Nigeria is finished state.
Re: FG, States Reach 3-month Agreement On LG Allocations by MajorOvakporaye(f): 7:51am On Aug 13
Criminals

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