Governors Resist Local Government Autonomy Despite Supreme Court Judgement, Lobby Tinubu Against Direct Payment to LG Accounts

Governors Resist Local Government Autonomy Despite Supreme Court Judgement, Lobby Tinubu Against Direct Payment to LG Accounts

State governors are intensifying efforts to delay the implementation of the Supreme Court ruling on local government autonomy, opposing the direct disbursement of federal allocations to local councils.

The ruling, which mandates that funds should bypass state governments and be paid directly to local governments, has faced strong resistance from the governors.

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In a bid to influence the process, some governors held a meeting with President Bola Tinubu at the State House in Abuja last Tuesday. The discussion, which followed an Iftar dinner, centered around the payment of local government allocations through the Central Bank of Nigeria (CBN). The governors raised concerns, arguing that many local councils are burdened with significant debts that must be addressed before implementing such a payment system.

Sources within the presidency revealed that the meeting was an effort to negotiate a more favorable disbursement process. “When the governors came for Iftar on Monday, they sought to meet with the President, which they did on Tuesday afternoon. Some stayed long after, leaving past six in the evening,” one insider explained.

A second official, who spoke anonymously, emphasized the governors’ reluctance to allow the federal government to control the disbursement process. “They don’t want the Federal Government to control the process. The government wants local councils to open accounts with the CBN, but the governors are against it. They fear that if the funds go through the CBN, they would need approval from the Accountant-General, which means the Federal Government will still have control,” the official said.

The governors are instead advocating for the funds to be paid into commercial bank accounts, arguing that this would offer more autonomy and prevent federal oversight. “One of the governors argued that if the CBN handles the accounts, it still puts the Federal Government in control. They don’t want that. They prefer using commercial banks,” another source added.

This dispute stems from a Supreme Court ruling on July 11, 2024, which affirmed the financial independence of local governments by requiring that their allocations be paid directly to their accounts, without interference from state governments. The ruling also declared that only democratically elected local government leaders could receive federal allocations, declaring caretaker committees appointed by governors to be unconstitutional.

To comply with the judgment, the CBN has required local governments to submit a two-year audit of their accounts before receiving federal funds. The central bank has also started profiling local government chairmen and the signatories to their accounts.

As the governors continue their lobbying efforts, it remains to be seen how the federal government and the CBN will respond to the pushback and whether the autonomy of local governments will finally be fully realized.