Nigerian local government areas (LGAs) have started the process of opening accounts with the Central Bank of Nigeria (CBN) as they prepare to receive direct federal allocations starting this January, according to Sunday PUNCH.
This move follows the Supreme Court’s landmark judgment on July 11, 2024, which affirmed the financial autonomy of the country’s 774 LGAs and declared the practice of state governors controlling local government funds as unconstitutional. The apex court directed that allocations be paid directly into LGA accounts.
Despite the verdict, reports suggest that governors have continued to manage LGA funds six months after the judgment. Previously, LGAs operated joint accounts with state governments, where federation allocations were deposited, often leading to deductions or alleged mismanagement by governors.
Hamisu Anani, the National Publicity Secretary of the Association of Local Governments of Nigeria (ALGON), confirmed that LGAs would open accounts with the CBN as part of the preparatory process. Anani acknowledged that while progress is being made, certain challenges remain, particularly for states where the CBN does not have a physical presence.
ALGON has been actively engaging key stakeholders, including state governors, finance commissioners, and the Attorney General of the Federation, to address concerns and ensure the successful implementation and sustainability of the Supreme Court’s judgment.
Anani emphasized that ALGON is not only focused on the implementation but also on the sustainability of the process, as the Supreme Court’s judgment has gaps that need to be addressed. He stated that all relevant stakeholders are working diligently to ensure that the right thing is done.