Supreme Court Orders Direct Payment to Local Governments from Federation Account, Bypassing Governors

Nigeria’s Supreme Court has ordered governors of the country’s 36 states to henceforth steer clear of the funds meant for its 774 Local Government Areas. The apex court says the control of funds of the local government councils by the states is unconstitutional.

This judgment is in respect of a lawsuit instituted by the federal government through the Attorney General of the Federation against the 36 state governors in a move to ensure full independence of the local government areas from the control of the state governors who until now controlled the funds and constitute caretaker committees to run the affairs of the local government areas.

In a landmark judgment delivered by a seven-member justice panel headed by Justice Lawal Garba, Nigeria’s apex court says the Constitution under Section 162 (4,5 and 6) doesn’t provide for the existence of a joint account for both the states and local government councils. 

In the lead judgment prepared and read by Justice Emmanuel Agim the court ordered that, henceforth, funds meant for the local government councils be paid to them directly from the federation account and not through the state governors. 

The court held that the provision of the constitution that funds meant for the local government councils be sent to the states is for them to act as agents of the federal government for the onward disbursement of same. It adds that the states are therefore not required to hold on to the money and use at will. 

It held that the states are exploiting the roles handed to them by the Clconstitution by holding onto funds meant for local government councils. 

The court also lamented that this has been on for over two decades, crippling the effective functioning of the third tier of government.

On the aspect of the full autonomy of the local government areas, the apex court said the state governors have for over 20 years constituted themselves “a species most dangerous” to the democratic structure of the local government councils. It held that caretaker committees installed by these governors is illegal as they have no powers to do so.

In a unanimous decision, the apex court further held that the leadership of the local government councils must be by democratic means, insisting no state governor has the powers to dissolve democratically elected local government leadership and install their choice officials to run the local government councils. 

As such, the apex court has also ordered the governors to desist from receiving, spending or tampering with funds released from the federation account for the local governments when no democratically elected local government system is put in place in the states. 

It therefore held that the constitution of Nigeria recognises federal, states and local governments as three tiers of government and that the three draw funds for their functioning from the federation account created by the constitution. 

The apex court ordersled immediate compliance by the state governors to the judgment.

Godfrey Eshiemoghie 

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