Autonomy: ALGON drags FG, states before court over FAAC sharing
The Association of Local Governments of Nigeria has taken legal action against the Federal Government on the implementation of local government autonomy.
In a suit registered as FHC/ABJ/05/353/2025 at a Federal High Court in Abuja, ALGON is demanding the inclusion of local government councils in the Federation Account Allocation Committee.
Joined in the suit as respondents are the Attorney-General of the Federation and Minister of Justice, Lateef Fagbemi; Minister of Finance and Coordinating Minister of the Economy, Wale Edun; Minister of Budget and National Planning, Abubakar Bagudu; and the Accountant-General of the Federation.
Other respondents are the Revenue Mobilization, Allocation and Fiscal Commission, the Central Bank of Nigeria, the Nigerian National Petroleum Corporation Limited, commercial banks, and the 774 local government councils.
ALGON’s Secretary-General, Mohammed Abubakar, confirmed the suit to Saturday PUNCH, saying it was to ensure that local governments received direct disbursements from the federation as directed by the Supreme Court.
On July 11, 2024, the Supreme Court ordered that local government allocations must be paid directly to them, as requested by the Attorney-General of the Federation, Lateef Fagbemi, SAN, in a suit filed at the court.
Fagbemi had instituted the lawsuit on behalf of the Federal Government, seeking to grant full autonomy and direct funding to all 774 local government councils in the country.
In a judgment read by Justice Emmanuel Agim, the apex court ruled that states’ retention of local government funds is unconstitutional.
“The demands of justice require a progressive interpretation of the law. It is the position of this court that the federation can pay local government allocations directly to the LGs or through the states.
“In this case, since payment through states has not worked, the justice of this matter demands that LG allocations from the federation account should henceforth be paid directly to the LGs,” the court ruled.
However, local government autonomy is yet to be implemented nearly eight months after the Supreme Court judgment.
According to reports, the Central Bank of Nigeria asked all the 774 councils to provide at least two years of audited financial reports before they could receive their allocations directly.
The apex bank insisted that the local governments must meet this requirement before opening accounts for direct remittance of their allocations.
Following the delay in the implementation, Abubakar said there was a need to approach the court to seek an order for the representation of local government councils in the Federation Account Allocation Committee, or any other body that deals with the allocation of these funds.
In the suit, the association urged the court for a declaration that any attempt to disburse funds to the 774 local governments through commercial banks or other agencies, without the authorisation and approval of the local councils, would be illegal.
Other prayers of the association include: “A declaration that the 1st to 8th defendants cannot disburse monies to the 774 local government councils in Nigeria, through the 9th to 23rd defendants or any other person whatsoever, without the plaintiff authorizing, approving said 9th to 23rd defendants or any other person whatsoever after conducting due diligence on them to avert any diversion of the funds of the local government councils.
“A declaration that the 1st to 7th defendants or any other person whatsoever cannot discuss, approve, disburse or in any other way whatsoever deal with the monies accruing to the 774 local government councils in Nigeria without the representation of the local government councils at such deliberations, discussions, committees, howsoever called, including at the Federation Account Allocation Committee (FAAC) chaired by the 2nd defendant.”
In addition, ALGON also requested an order restraining the defendants from continuing to disburse funds to the local governments through any other agency or without the direct involvement of the local government councils in the process.
