By IYKE Grant
The bold action of the Attorney-General of the Federation, Lateef Fagbemi (SAN), in filing the suit on behalf of the Federal Government to grant full autonomy and direct funding to all 774 Local Government Councils in Nigeria, has put to rest the protracted intrigues and ambivalence over the third tier of governance contrived by state governments and vested interests for many years.
On July 11, 2024, the Supreme Court comprising a panel of seven justices with, Hon. Justice Lawal Garba as the lead; Hon. Justice Emmanuel Agim (who read the judgment); Hon. Justice Chioma Nwosu-Iheme; Hon. Justice Haruna Tsammani; Hon. Justice Moore Adumein; Hon. Justice Habeeb Abiru (who held a dissenting view); and Hon. Justice Yammama Tukur, reaffirmed the autonomy of the Local Government Councils in the Country with the declaration that the appointment of Caretaker Committee chairmen in the LGAs, is illegal and should no longer be entertained.
The Supreme Court also ruled that allocations from the Federation Accounts Allocation Committee (FAAC), which are hitherto disbursed to the 774 local government councils through their respective State Governments should cease henceforth.
With this, disbursement of allocations to the Local Government Councils in the Country through the Accountant-Generals in the States will no longer be tenable. That, in essence, is financial freedom for Local Council Administrations.
The Attorney-General and Minister of Justice had in May, 2024, filed a suit marked SC/CV/33/2024 challenging the unilateral, arbitrary and unlawful removal of democratically elected chairmen of Local Government Councils by State Governors.
Other reliefs sought by the suit, include a restraint on States to desist from constituting Caretaker Committees to run the affairs of the Local Governments, and an injunction on them, their agents and privies from receiving, spending or tampering with funds released from the Federation Account to the Councils.
For keen followers of affairs in grassroots administration under the fourth Republic, the judgment resolves the longstanding refusal of State Governors to allow a functional third tier system, a deliberate subversion of the 1999 Constitution.
Section 7(1) provides that: “The system of Local Government by democratically elected Local Government Councils is under this Constitution guaranteed; and accordingly, the Government of every State shall subject to Section 8 of this Constitution, ensure their existence under a law, which provides for the establishment, structure, composition, finance and functions of such Councils.
The Supreme Court, drawing from the provisions of the Constitution delivered the landmark judgment, which restores the administrative and financial structures of the third tier of government.
Perhaps the only exception to the flurry of jubilation that accompanied the ruling would be the state governors who must feel hard done by.
The reasons for jubilation are not far-fetched. Local government administrations have suffered deprivation, neglect and abandonment with the control and virtual seizure of the Councils’ financial allocations resulting in irregular or non-payment of salaries, and lack of capacity to execute developmental projects.
A cursory look across the country shows Council Secretariats as desolate chambers where only employees who have nothing else to do visit to while away time. Only the creation of Local Education Authority has kept the public primary school system in low gear, otherwise the burden of unpaid teachers’ salaries would all but have crippled it under dysfunctional Council administrations.
With this development, the leaderships of the National Union of Local Government Employees (NULGE), and Association of Local Government Administration (ALGON) whose members have suffered deprivation and dictatorship from state authorities will heave a sigh of relief.
Legal luminary, Prof. Fabian Ajogwu, SAN, described the ruling as a landmark and a triumph for fiscal federalism. It is his belief that the decision is a significant affirmation of the position of the law under the Constitution and, therefore, represents a crucial step forward for fiscal federalism.
He contends that “the autonomy of Local Government Councils, is a cornerstone of effective governance and grassroots development”.
By its ruling, the Supreme Court has reinforced the importance of decentralization and the empowerment of local authorities to manage their affairs independently.
The Constitution lists the Local Government as the third tier of government in the hierarchy of power, coming after the federal and State Governments and so have their monthly allocations direct from FAAC as does the federal government and states with the ratio of 20.60%, 52.68% and, 26.72% respectively.
By sheer deviance, States have contrived to operate joint accounts with Local Councils wherein they appropriate the Councils’ share of financial allocations to re-disburse by some predetermined but unconstitutional criteria.
Rather than independence, Councils have been forced to operate as appendages of states with State assemblies or governors often presuming to sack or dissolve local councils with whimsical abandon.
That the judgment generated this level of excitement and jubilation is a demonstration of what the BGL Financial Monitor tried to explain in its Edition of January 2002 that, “society is to be better off, than otherwise, with government operating with the intention of improving society by removing any obstacle to the advancement of the welfare of society and creating the environment for it to happen”.
Ostensibly, the judgment has removed the obstacle that will generate and fast-track development in the local government areas
In the same context, the issue of financial autonomy for local government councils, the judiciary and legislative arms has been a contentious but important discourse.
The Buhari administration addressed concerns of the judiciary and the legislature on May 22, 2020 when he signed the Executive Order No. 10 of 2020, affirming financial autonomy for states’ legislature and judiciary.
The Order empowered the Accountant-General of the Federation to deduct at source the allocations due to the states in the Federation Accounts, and disburse same directly to the 36 state legislatures and judiciary.
It therefore goes without saying, that the apex court’s judgment is a giant leap which expectedly, will alter the structure of governance and fast track development in local government councils in the Country.
After all, they were created to enhance the development of the rural areas. The 1976 Local Government Reforms were intended to ensure the overall development of the grassroots and possibly stem rural-urban migration.
Over the years especially since 1999, the local administrations have performed abysmally and below expectations. This has been attributed to the financial strangulation of the system by the state governors, besides other factors.
Nonetheless, it is hasty to conclude that the implementation of the financial autonomy is a short circuit to achieving the desired result. C. N. Iheji a learned practitioner notes that: “It is important to recognize that the legal framework for decentralization in constitutions is one of the many factors that determine the success of decentralization.
In other words, the principle of autonomy is significant in the determination of whether there is an assignment of sufficient and real power to a democratic Local Government.
Therefore, clear legal framework for constitutional recognition, democratization, fiscal autonomy and a clearly defined structures or organs of the Local Government, are vital to the success or otherwise of the Supreme Court’s resolution.
As the engine of democracy and the closest avenue of reaching the people, Local Government powers need also be properly defined within the overall framework of whole system of governance, especially as population keeps increasing and as cities and towns grow into endemic urbanization problems.
The judgment does not only give financial freedom to Local Council administrations, it also frees the grassroots from dictatorship, and hopefully, will reset the foundation for broad-based development.
The Supreme Court has broken the chains of deliberate and conscious underdevelopment of the Country foisted by State governments. Nigerians hopes this is for good and that another metamorphosis of collaborative enslavement, corruption and misapplication of resources does not emerge.
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