Governors Block LG Autonomy, Warn Local Government Chairmen Against Opening Accounts with CBN

Governors Block LG Autonomy, Warn Local Government Chairmen Against Opening Accounts with CBN

 

 

Fresh revelations have surfaced indicating that several state governors are actively blocking local government chairmen from opening official accounts with the Central Bank of Nigeria (CBN), a crucial requirement for the direct disbursement of federal allocations to local governments.

 

This development comes nearly nine months after the Supreme Court of Nigeria issued a landmark judgment granting full financial autonomy to the country’s 774 local government areas (LGAs).

 

The ruling, which was expected to mark a significant step toward ending the practice of state governments controlling local government allocations, is now facing resistance from state governors.

 

Under the Supreme Court ruling, local governments were to receive their monthly allocations directly from the Federation Account, bypassing state governments. In a bid to implement the judgment, the Federal Government constituted a special committee, which recommended that the CBN open dedicated accounts for each of the 774 LGAs.

 

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However, the process of opening these accounts has stalled as many state governors have actively blocked the move. According to insiders, these governors are pressuring local government chairmen not to comply with the CBN’s directive.

 

This resistance is widely believed to stem from the governors’ fear of losing control over local government funds—an essential financial lifeline for many state administrations.

 

Despite the Supreme Court’s ruling and federal efforts to operationalize the new system, local government chairmen are facing increasing pressure from their state governors.

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Key federal officials, including the former Accountant-General of the Federation, Oluwatoyin Madein, and the Minister of Justice and Attorney-General of the Federation, Lateef Fagbemi, SAN, have been engaged in discussions with the CBN to facilitate the transition. However, a major challenge remains: many local governments across the country do not have democratically elected officials, a precondition for opening accounts.

 

In a recent meeting of the Federation Account Allocation Committee (FAAC) Technical Sub-Committee, it was revealed that only Delta State had complied with the directive, submitting local government account details to the CBN.

 

Other states have yet to follow suit, and local government chairmen are increasingly expressing frustration over the lack of progress.

 

Several chairmen, who spoke anonymously to Punch Newspaper, described being subjected to significant pressure and intimidation by their state governors.

 

One chairman from the South-East recounted a failed negotiation with his governor, revealing that he was even willing to remit 50% of the local government allocation to the state in exchange for approval to open the CBN account. However, the governor refused, underlining the level of control state executives seek to retain over local government finances.

 

A chairman from the South-West further explained the difficulties local governments face in complying with the CBN’s requirements. Among these requirements is the submission of two months’ worth of audited bank statements—a document many LGAs simply do not have. “Governors manage the accounts and disburse funds at will. Most councils don’t even know what comes in monthly,” he said.

 

The ongoing resistance from state governors paints a concerning picture for the future of local government autonomy in Nigeria.

 

Despite judicial backing and federal intent to decentralize financial control, it seems that entrenched political interests at the state level continue to undermine the Supreme Court’s decision.

 

As the situation stands, the full implementation of local government financial autonomy remains uncertain. Without stronger enforcement mechanisms, there are growing concerns that the Supreme Court’s ruling may ultimately be rendered ineffective.

 

Local government chairmen and federal officials alike are left wondering if true autonomy will ever be realized or if state governors will continue to assert control over these funds.