LG Autonomy: State Governors Prevent Council Chairmen from Opening CBN Accounts
The implementation of the Supreme Court’s ruling on local government autonomy faces new challenges, as several state governors are explicitly discouraging council chairmen from opening accounts with the Central Bank of Nigeria (CBN) for direct federal allocation payments. This development complicates the situation nearly nine months after the ruling granted full autonomy to 774 local governments, facilitating direct payments from the Federation Account.
The failure to implement the landmark Supreme Court judgment on local government autonomy in Nigeria has sparked intense debate and controversy. Despite the court’s ruling granting financial autonomy to the 774 local governments, state governors have devised ways to bypass the order, undermining the autonomy of local governments
To support this judgment, the federal government established a panel that directed the CBN to open accounts for local governments. However, the process has seen delays, with conflicting claims between the CBN and local governments regarding the opening of these accounts.
Recent discussions among officials, including the immediate past Accountant-General and the Attorney-General, revealed difficulties in identifying local governments with democratically elected leadership as only Delta State LGAs have submitted their account details. Reports indicate that governors are resorting to intimidation tactics, pressuring council chairmen against opening CBN accounts for direct allocations. One anonymous chairman from the South-East recounted, “Our governor has threatened us… not to open accounts with the CBN for the direct payment of our allocation.” Attempts to negotiate an agreement with the governor—offering to remit 50% of allocations in return for lifting the restriction—have failed.
Many governors oppose opening CBN accounts, fearing loss of access to local government funds. While a few governors support the idea, most have met with President Bola Tinubu, advocating for local councils to open accounts with commercial banks instead of the CBN, a position still under consideration.
Another chairperson cited strict CBN conditions as a barrier to account openings, while a chairman in Benue State alleged that state governors are purposely obstructing LG financial autonomy. “What they are pushing for… is for council chairmen to open their accounts in commercial banks where they can easily have access to control the councils’ money,” he stated.
In contrast, the Nigerian Union of Local Government Employees (NULGE) in Nasarawa State reported compliance with the directive to open accounts but noted that no local government councils have yet received direct allocations from the Federal Government.
Local government chairmen across different states, including Yobe and Zamfara, expressed uncertainty about the status of their account openings and financial independence. In Kano, confirmed that none of the local councils have opened CBN accounts, while chairmen in Jigawa reported ongoing processes to establish these accounts, although administrative challenges have delayed progress.
An anonymous NULGE official hinted at potential opposition from state governors to local government autonomy reform. Despite varying degrees of implementation progress and resistance, the general sentiment among local government officials indicates a struggle for financial independence from state control.
Key Challenges to Local Government Autonomy
- Financial Control: State governors exert significant control over local government finances, often using secret deals and oath-taking to ensure compliance.
- Legislative Powers: Local governments have limited legislative powers, with state governments making laws that regulate their functions and finances.
- Appointment of Officials: State governors frequently appoint officials to manage local governments, further eroding their autonomy.
- Interference in Decision-Making: State governments often interfere with local government decision-making processes, hindering their ability to make independent decisions.
Consequences of Limited Autonomy
- Inefficient Service Delivery: Limited autonomy hampers local governments’ ability to deliver essential services, such as healthcare, education, and infrastructure development.
- Corruption and Mismanagement: Over-reliance on state governments can lead to corruption and mismanagement of funds, as local governments may not have the autonomy to manage their resources effectively.
- Underdevelopment: Restricted autonomy can hinder local economic growth and development, as local governments are unable to make decisions that best suit their specific needs.
Efforts Towards Greater Autonomy
- Constitutional Amendments: There have been efforts to amend the Constitution to grant more autonomy to local governments, but progress has been slow.
- Judicial Interventions: Courts have occasionally ruled in favor of local government autonomy, but these decisions are not always enforced.
- Grassroots Movements: Civil society organizations and community groups are advocating for greater local government autonomy, recognizing its importance in promoting effective governance and development.