Supreme Court Grants Financial Autonomy to Local Governments

Supreme Court’s Historic Ruling on Local Government Autonomy

TOUCHAHEART – In a landmark decision, the Supreme Court of Nigeria has granted full financial autonomy to the country’s 774 Local Government Areas (LGAs).

This ruling effectively bars the 36 state governors from retaining or utilizing funds meant for the LGAs, marking a significant shift in the governance structure of Nigeria.

Unconstitutional Practices Halted

The apex court declared it illegal and unconstitutional for governors to continue receiving and seizing funds allocated to LGAs.

This practice, which has persisted for over two decades, was deemed a clear violation of Section 162 of the 1999 Constitution, as amended.

Justice Emmanuel Agim, delivering the lead judgment, emphasized that no state House of Assembly has the authority to enact laws that interfere with LGA funds.

The Supreme Court stressed that LGAs must be governed by democratically elected officials. It ordered that funds meant for LGAs be directly paid to them from the federation account, bypassing state governments.

This decision aims to ensure that local governments operate independently and are not subject to the whims of state governors.

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Progressive Interpretation of the Law

Justice Agim highlighted the need for a progressive interpretation of the law, stating that the federation can either pay LGA allocations directly or through the states.

However, given the failure of the latter method, the court-mandated direct payments to LGAs to uphold justice.

The court also declared the appointment of caretaker committees by governors to manage LGAs as unconstitutional.

This practice undermined democratic governance at the local level, and the ruling reinforces the obligation of states to ensure democratic processes within LGAs.

Background of the Case

This judgment followed a suit filed by the Federal Government seeking financial autonomy for LGAs.

The Supreme Court dismissed preliminary objections raised by state governors challenging the competence of the suit, thereby affirming the federal government’s stance on the issue.

This ruling is a monumental step towards strengthening local governance in Nigeria, ensuring that LGAs receive their due funds and operate with greater autonomy and democratic integrity.