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Supreme Court Orders FG To Disburse Funds Directly To Local Governments

The Supreme Court has mandated that the federal government must now directly allocate funds to local government councils from the federation account.

In a landmark decision delivered by a seven-member panel of justices on Thursday, the court found that state governments have been misappropriating funds intended for local government areas (LGAs). The justices emphasized that the continuous misuse of these funds by state authorities must cease.

Additionally, the Supreme Court ruled that the federal government should withhold allocations to LGAs that are managed by officials appointed by governors, rather than elected representatives.

This ruling follows a lawsuit filed by the federal government in May against the governors of all 36 states. The case, identified as SC/CV/343/2024, called for complete autonomy for Nigeria’s 774 local governments.

Attorney-General of the Federation and Minister of Justice, Lateef Fagbemi, filed the suit, seeking authorization for the direct transfer of funds from the federation account to local governments, as stipulated by the constitution. The federal government’s plea was based on 27 grounds.

The originating summons stated, “The constitution of Nigeria recognizes the federal, state, and local governments as three distinct tiers, all of which draw their operational funds from the federation account established by the constitution.”

The federal government argued that previous attempts to compel governors to adhere to the 1999 Constitution by establishing democratically elected local government systems have been ineffective. Continuing to disburse funds to governors for local governments that lack democratic elections, it argued, undermines the constitution’s integrity.

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The federal government urged the Supreme Court to enforce sections 1, 4, 5, 7, and 14 of the constitution, obligating governors and state legislatures to ensure democratically elected systems at the local government level.

This judgment marks a significant step toward enhancing the autonomy and accountability of local government councils across Nigeria.

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