In a landmark ruling, the Supreme Court has prohibited the 36 state governors from retaining or utilizing funds intended for the 774 Local Government Areas (LGAs) across Nigeria.
The apex court declared that it is both illegal and unconstitutional for governors to continue receiving and seizing funds allocated to LGAs in their states.
The court’s decision marks an end to what it described as a “dubious practice” that has persisted for over two decades, constituting a clear violation of Section 162 of the 1999 Constitution, as amended.
The lead judgement, delivered by Justice Emmanuel Agim, emphatically stated that no state House of Assembly has the authority to enact laws that interfere with monies designated for LGAs.
Emphasizing the constitutional mandate for LGAs to be governed by democratically elected officials, the Supreme Court ordered that all future funds meant for the LGAs must be paid directly from the federation account.
“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 of this case demands that LGA allocations from the federation account should henceforth be paid directly to the LGAs.”
Furthermore, the court declared unconstitutional the appointment of caretaker committees by governors to manage LGA affairs, reiterating that the 36 states are obligated to ensure democratic governance at the local government level.
This judgement followed a suit filed by the Federal Government aiming to secure financial autonomy for the LGAs. The Supreme Court also dismissed preliminary objections raised by the state governors challenging the competence of the suit.
The ruling is expected to significantly alter the financial dynamics between state and local governments, fostering greater autonomy and democratic governance at the grassroots level.
