After three decades of intense clamour for administrative and fiscal autonomy, the Supreme Court, on July 11, delivered a landmark judgment affirming the financial independence of 774 local governments in the country.
The seven-justice panel of the apex court headed by Justice Mohammed Garba, in the judgment delivered by Justice Emmanuel Agim, ruled that the councils are entitled to the freedom to manage their own funds.
In May, the Federal Government, through the Attorney-General of the Federation (AGF) and Minister of Justice, Lateef Fagbemi (SAN), filed a suit at the Supreme Court accusing the state governments of not properly running the local governments.
State governments, through their Attorneys, fought spiritedly to maintain the status quo. But, the apex court, in granting the prayer of the Federal Government for autonomy, condemned the dissolution of elected local councils by state governors.
Justice Agim said: “It is the position of this court that the federation can pay local government allocations directly to the local governments or through the states. In this case, since paying them through the states has not worked, justice demands that local government allocations from the Federation Accounts should henceforth, be paid directly to the local governments.”
He added: “I hold that the states’ retention of local government funds is unconstitutional.”
The verdict was a clear order for a clean break from the sordid past. Before this judgement, the usual practice was to remit the funds accrued to the state and local governments from the Federation Account to a joint account at the state level.
Instructively, at the state level, during the Joint Account and Allocation (JAAC) meeting, local government is a junior partner that cannot question the authority of the state on the modalities for fund allocation and sharing.
From the joint account, each local government was to collect its deserving shares, in line with the provisions of Section 162 of the 1999 Constitution.
However, the sharing formula is determined by the governor, who allocates funds according to his whims and caprices.
Justice Agim observed that in the last two decades, the states have been retaining funds due to the local governments and disbursing them anyhow, contrary to the constitutional provision.
The result is that councils are handicapped and cannot perform their constitutional roles as outlined in the Fourth Schedule of the 1999 Constitution (as amended). The efficient performance of these roles requires adequate funding.
Fundamentally, the local government has constitutional responsibility for primary education and primary health care. Across many councils, public primary schools and health centres are in states of disrepair. Many parents shun public primary schools due to the non-conducive atmosphere for learning, lack of adequate facilities and poorly motivated teachers. Classrooms floors are ruptured, buildings are cracking, roofs are leaking and there is overcrowding.
Lack of efficient primary health care system makes Nigerians seek medical attention in tertiary health institutions, even for common malaria fever.
Refuse disposal is an uphill task. So is the maintenance of markets. Apart from lack of funding, in many local governments, the personnel expertise is suspect. Many council workers are ill-trained and lack competence.
Sixty per cent of the Nigerian roads are managed by councils. Many of these roads are impassable, inaccessible and death traps. The infrastructural deficit is huge. When council chairmen are confronted over the neglect or shortfall in role fulfilment, they heap the blames on the governors.
In many states, council chairmen have cried out about illegal diversion of council funds, misappropriation and hijack of allocations. Protest by chairmen has often led to blackmail, intimidation, removal from office and dissolution of councils.
The awful picture of ruptured state/local government relations contrasted with the earlier era when state governments, apart from remitting full allocations to councils, also set aside 10 percent of state resources for funding developmental projects undertaken by local governments.
To observers, particularly the National Union of Local Government Employees of (NULGE) and Association of Local Governments of Nigeria (ALGON), the Supreme Court judgement is a novel pronouncement; a landmark verdict that has redefined the relationship among the three levels of government – federal, state and council.
However, governors kicked against it. In fact, some efforts were made to get their Houses of Assembly to enact a law that would sustain the status quo.
However, the judgement is final, since the apex court is the last arbiter in any constitutional conflict between the federal and the sub-national units of the federation. Up to now, the defendants have not prayed for a review.
But, according to analysts, the judgement left other critical questions hanging, thereby stirring some controversies and boxing the polity into confusion.
Having abrogated the State/Local Government Joint Account, the councils are to receive their allocations directly from the centre. The goal is to escape the perpetual abuse of council allocations by state governments.
Many Nigerians believe that local governments can now make decisions without approval from state governments. They are strengthened to manage their finances, collect revenues, and allocate resources without state government interference.
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The implication of the full financial autonomy is that their share of the monthly statutory allocations from the Federation Accounts Allocation Committee (FAAC) would be sent to them directly. Also, the councils are at liberty to spend their internally generated revenue without reference or interference from the state government.
Fiscal autonomy means that councils have the power to create their own sources of revenue in addition to their equitable share in the national taxes released by the national government. More importantly, they can creatively allocate their resources in accordance with their own priorities, and as dictated by the communities.
Besides, the Supreme Court also restored democracy to grassroots administration. The provision of the 1999 Constitution that democratically elected councils are fully guaranteed is now being vigorously enforced.
Caretaker committees imposed on local governments are becoming old fashioned or outdated. Many states have responded to the new realities by conducting elections that threw up elected chairmen and councillors.
The full democratisation of local government system is a major breakthrough. These developments are also likely to make competition for political offices at the grassroots level more competitive, stiff and tensed.
However, the judgment failed to resolve a major hurdle, which is at the core of the national question. In the Nigerian federalism, there is a federal government and states as federating units, and not councils, are co-ordinate to the national or central government.
Fundamentally, councils are presumed to be units created for ease of administration at the areas. They are basically the extension of state government, with the House of Assembly retaining political of control over them. Thus, the judgement has polarised the polity, and created a basis for more discussions on the fate and future of federalism in Nigeria.
Many scholars of federalism have pointed out that the Supreme Court verdict appears to have set the stage for increased centralisation of power, despite the persistent and legitimate agitation for devolution to foster “true” federalism.
The Supreme Court has not expressly pronounced that the states or House of Assembly have no supervisory control over local councils. But what manner of political or administrative control can they exercise without financial supervision?
Also, the 1999 Constitution is full of flaws, omissions and gaps, which legal experts feel should not be filled by the apex court. While the constitution provides for allocations to local government, there is no provision in the law that compels the Federal Government to pay directly to the councils. In this regard, many lawyers feel that a constitution review is imperative.
In his dissenting judgment, Justice Habeeb Abiru contented that the court cannot take over the job of the National Assembly. He declared: “The court cannot use liberal or broad interpretation principles to fill in perceived gaps in the provisions of the constitution; that is the job for the legislature”
Abiru alluded to the Attorney-General of the Federation versus Atiku ( 2007), where Akitan (JSC) held that ” for the court to enact or write into the constitution what its makers failed to insert would amount to the court enacting laws and Lord Simmons described such an act ” a naked usurpation of legislative function under the thin guise of interpretation, and it is the less justifiable when it is guess work with what material the legislature would, if it had discovered the gap, have filled it in. If a gap is discovered, the remedy lies on the amending Act.”
