Chief Okegbue Nzeribe, PhD


By Chief Okegbue Nzeribe,  PhD 


In a landmark decision, Nigeria's Supreme Court has ruled on a matter of critical importance to the nation's democratic structure: the autonomy and financial independence of local governments. This judgment marks a pivotal moment in Nigeria's ongoing journey towards true federalism and effective governance at all levels.


Local governments, often referred to as the third tier of government in Nigeria, play a crucial role in the country's governance structure. They are designed to be the closest form of government to the people, addressing grassroots needs and fostering community development. However, for years, this tier has been hamstrung by excessive state control, particularly in matters of finance and leadership.


The roots of this problem can be traced back to the 1999 Constitution of the Federal Republic of Nigeria. While the constitution stipulates that local governments should be administered by democratically elected chairmen, it also established the Joint Account Allocation Committee (JAAC) system under section 162(6). The JAAC was intended to enhance fiscal responsibility through state supervision of local government spending. However, this well-intentioned system became a tool for state governments to exert undue control over local government finances.


Over time, two major issues emerged that severely undermined local government autonomy:

1. Financial Control: State governments routinely withheld funds meant for local governments, disbursing only a fraction of the allocated amounts. This financial strangulation crippled the ability of local governments to fulfill their constitutional responsibilities.


2. Leadership Appointments: Many state governors adopted the practice of appointing temporary caretakers or transition committees to run local governments, rather than conducting elections as mandated by the constitution. This not only contravened democratic principles but also created a system of political patronage that often prioritized loyalty to state governments over local needs.


These practices left local governments at the mercy of state governors, unable to effectively serve their communities or implement meaningful development projects. The situation became so dire that it threatened the very essence of grassroots democracy in Nigeria.


Recognizing the gravity of this situation, the Federal Government took the commendable step of initiating legal action. The case sought to determine the appropriateness of appointing administrators for local governments and the current system of local government fund disbursement through state governments.


The Supreme Court's ruling on this matter is nothing short of revolutionary. Key points of the judgment include:

1. Direct Payment: The Court ruled that local government allocations from the federation account should henceforth be paid directly to the local governments, bypassing state control.


2. Unconstitutional Retention: It declared the states' retention of local government funds unconstitutional.


3. Injunctions: The Court issued injunctions restraining states from collecting these funds when no democratically elected local government councils were in place.


4. Immediate Enforcement: The judgment called for immediate enforcement and compliance by state governments and successive administrations.


This ruling represents a significant victory for local government autonomy and, by extension, for Nigerian democracy as a whole. It reaffirms the constitutional status of local governments and provides a clear path for their financial independence.


The implications of this judgment are far-reaching:

1. Financial Autonomy: Local governments will now have direct control over their allocated funds, enabling them to plan and execute projects without undue interference from state governments.


2. Democratic Representation: The ruling reinforces the need for democratically elected local government officials, potentially putting an end to the practice of appointed caretaker committees.


3. Improved Service Delivery: With access to their full financial allocations, local governments should be better positioned to provide essential services and implement development projects in their communities.


4. Accountability: Direct control of funds will come with increased responsibility. Local government officials will need to be more accountable to their constituents for the use of these resources.


While celebrating this landmark judgment, it's important to recognize that further reforms are necessary to fully realize the democratic potential of local governments. A crucial step in this direction would be to transfer the responsibility for conducting Local Government Area elections from state electoral commissions to the Independent National Electoral Commission (INEC). The current system, where states conduct these elections, often gives an unfair advantage to the incumbent state government. This arrangement can potentially enable governors to influence the election of their proxies, thereby maintaining indirect control over local government funds despite the Supreme Court ruling. Entrusting INEC with this responsibility would help ensure fairer, more transparent elections at the local level, further strengthening grassroots democracy and the autonomy of local government.


However, the path forward is not without challenges. State governors are now called upon to embrace this judgment in good faith, recognizing that local governments require financial autonomy to effectively address the unique needs of their communities. While state governments should maintain a supervisory role through strategic reviews, direct control of local government finances must cease.


States currently administering local governments through appointed chairmen must conduct elections without delay. This will enable democratically elected officials to assume control of local government finances, as mandated by the Constitution and reinforced by this landmark judgment.


For local government chairmen, this newfound autonomy comes with greater responsibility. They must exercise utmost financial prudence, fiscal responsibility, and transparency in their spending. Regular audits, public financial reports, and community engagement should be institutionalized to ensure accountability and build public trust.


The Federal Government's decision to initiate this legal action demonstrates a commendable commitment to upholding the Constitution and strengthening democratic institutions. This "fatherly" intervention was crucial in addressing a long-standing issue that has hindered effective governance at the local level.


As Nigeria continues to navigate the complexities of its federal system, this judgment serves as a reminder of the ongoing need to uphold constitutional principles and adapt governance structures to serve the best interests of the people. It provides an opportunity to revitalize grassroots governance, enhance service delivery, and foster closer connections between government and citizens.


In conclusion, this Supreme Court judgment represents a victory not just for local governments, but for Nigerian democracy as a whole. It reaffirms the principle of separation of powers and reinforces the constitutional status of local governments as a distinct tier of governance. All stakeholders – federal and state governments, local government officials, and citizens – must now work together to ensure that the spirit of this judgment is fully realized, ushering in a new era of effective, responsive, and truly democratic local governance in Nigeria. The success of this ruling will ultimately be measured by its impact on the lives of ordinary Nigerians and the development of local communities across the nation.