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From Godwin Tsa, Abuja
The Supreme Court has barred the 36 governors of the federation from retaining or utilising funds meant for the 774 Local Government Areas (LGAs).
In a landmark judgement delivered by Justice Emmanuel Agim, the apex court ruled that it is illegal and unconstitutional for governors to receive and seize funds allocated to LGAs.
The court pronounced that this “dubious practice”, ongoing for over two decades, violates Section 162 of the 1999 Constitution, as amended. It specifically held that Section 162 (4&5), which stipulated a joint account for state and local governments, has been exploited by state governments, necessitating direct payment of LGA funds from the federation account.
The court unanimously agreed that no State House of Assembly has the power to enact laws interfering with LGA funds.
Justice Agim stressed that the law mandates democratically elected officials to govern LGAs. He emphasised that Nigeria operates a three-tier system of government where no tier is subordinate to another. The Supreme Court ordered that, henceforth, funds meant for LGAs must be paid to them directly from the federation account.
The apex court observed that for the last two decades, states have been retaining and disbursing LGA funds at their discretion, contrary to constitutional provisions.
“Demands of justice require a progressive interpretation of the law. It is the position of this court that the federation can pay LGA allocations to the LGAs directly or pay them through the states,” Justice Agim stated.
“In this case, since paying them through states has not worked, justice demands that LGA allocations from the federation account should henceforth be paid directly to the LGAs.”
The court also declared the appointment of caretaker committees by governors to run the affairs of LGAs unconstitutional, holding that the 36 states are obligated to ensure democratic governance at the third tier of government.
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Before addressing the substantive issue, the apex court dismissed preliminary objections filed by the 36 states challenging the Attorney General of the Federation’s (AGF) legal standing to initiate the action.
Mr Osita Okechukwu, Director General of the Voice of Nigeria (VON), hailed the Supreme Court judgement as iconic, stating it would restore grassroots democracy in Nigeria.
Noting that the judgement curbs the power of “Emperor-Governors”, Okechukwu said it would restructure the local government system. He called for monitoring and prudent management of the 20.6% Federal Revenue Allocation to local government councils.
He lamented that for 25 years, governors have undermined Section 7 of the Constitution by allegedly rigging local council elections and mismanaging the 20.6% local government funds, hindering the development of grassroots democracy.
Okechukwu praised the Supreme Court Justices for restoring democracy at the grassroots level and reinforcing Section 7 of the 1999 Constitution, which guarantees a system of democratically elected local government councils.
“To me, the iconic judgement will, pure and simple, restore grassroots democracy in Nigeria from Emperor-Governors. Today the judgement has also restructured our local government system; therefore, I call on all to monitor and ensure the prudent management of the 20.6% Federal Revenue Allocation to local government councils,” he stated.
He urged Nigerians to monitor the 20.6% federal allocation to local government councils, ensuring its prudent use in developing rural communities. He commended President Bola Tinubu and Attorney General Lateef Fagbemi for their roles in achieving this victory for grassroots democracy.
The Federal Government, in suit SC/CV/343/2024, had asked the Supreme Court to grant full autonomy to all LGAs as the third tier of government. It sought an order prohibiting state governors from arbitrarily dissolving democratically elected local government leaders and an order permitting direct payment of LGA funds from the Federation Account, bypassing the joint accounts allegedly created by governors.
The states, however, filed preliminary objections seeking the suit’s dismissal, arguing that the AGF lacked the legal standing to initiate the action and had breached their right to a fair hearing.
