State governors are resisting the Supreme Court’s ruling on local government financial autonomy, opposing the federal government’s plan to channel funds through the CBN. They cite outstanding debts and push for commercial bank payments. President Tinubu urges collaboration, but delays persist, raising concerns over transparency and grassroots development.
State governors are intensifying efforts to delay the implementation of the Supreme Court’s ruling on local government financial autonomy, resisting the federal government’s plan to route allocations through the Central Bank of Nigeria (CBN).
During a closed-door meeting with President Bola Tinubu at the State House in Abuja, the governors expressed concerns over multi-billion-dollar debts tied to local government accounts. They argued that CBN’s control over disbursements would undermine their financial authority and advocated for direct payments to commercial banks instead.
A source privy to the discussions revealed that governors used a recent Iftar dinner as an opportunity to lobby Tinubu for a compromise. “They don’t want Abuja controlling the funds through the CBN. They argue that states should have a say in financial management,” the source said.
The Supreme Court’s ruling, delivered on July 11, 2024, mandated that federal allocations go directly to local governments, bypassing state governments entirely. The decision also restricted access to these funds to only democratically elected local government officials, barring appointed administrators from financial control.
However, implementation has faced delays nearly nine months after the verdict. The CBN, tasked with opening accounts for the 774 local government areas (LGAs), has encountered resistance from state leaders who cite unresolved financial liabilities. Additionally, the apex bank has requested two years’ worth of financial audits from LGAs before approving direct disbursements, further complicating the transition.
The National Union of Local Government Employees has warned against any moves that would allow governors to retain influence over local government funds. Similarly, the Association of Local Governments of Nigeria (ALGON) has called for greater transparency, with Secretary-General Mohammed Abubakar raising concerns over potential fund misappropriation.
“There’s a real danger that local government money could be diverted to settle debts they never incurred,” Abubakar stated. He urged broader consultations among key stakeholders, including local government chairmen, labor unions, and financial regulators, to ensure a fair and transparent transition.
President Tinubu has emphasized that his administration is not in conflict with the governors but insists that collaboration is crucial for grassroots development. However, with state governors reportedly pressuring the CBN to delay direct disbursements, the fate of local government autonomy remains uncertain.
