FG MOVES TO END STATES’ CONTROL OVER LOCAL GOVERNMENT FUNDS

FG MOVES TO END STATES’ CONTROL OVER LOCAL GOVERNMENT FUNDS


The Federal Government has reiterated its determination to end the long-standing interference by state governments in funds allocated to Nigeria’s 774 local government areas from the Federation Account.

This assurance was given on Thursday in Abuja by the Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Dr Mohammed Shehu, during the 2025 budget performance appraisal and the 2026 budget defence organised by the House of Representatives Committee on Finance.

Dr Shehu expressed concern over the continued encroachment by state governments on local government finances, describing the practice as a major obstacle to effective governance and development at the grassroots level. He stated that the commission was prepared to take concrete measures to ensure full financial autonomy for local councils across the country.

According to him, RMAFC plans to re-establish a Local Government Committee to closely monitor financial activities in all councils nationwide, a move aimed at strengthening accountability and transparency in the management of public funds.

He disclosed that President Bola Ahmed Tinubu had personally engaged state governors on the issue, warning that the Federal Government could resort to executive action if local government autonomy is not respected. Dr Shehu said the commission fully supports the President’s stance on enforcing financial independence for local governments.

The RMAFC chairman noted that the weakening of local government administration has contributed significantly to Nigeria’s development challenges, stressing that local councils previously played a more effective role in service delivery and community development.

He also commended the House Committee on Finance for its oversight role, saying its support has enhanced the commission’s credibility among key revenue-generating agencies. According to him, institutions such as the Nigeria Customs Service and the Nigerian Upstream Petroleum Regulatory Commission have shown improved cooperation with RMAFC.

Highlighting recent achievements, Dr Shehu revealed that the commission had conducted an audit of oil and gas assets across the Niger Delta region. He also informed lawmakers that work on a new revenue allocation formula for the three tiers of government was nearing completion.

In addition, he disclosed that the review of remuneration for political office holders had been concluded and submitted to the President through the Secretary to the Government of the Federation, expressing optimism that the recommendations would soon be acted upon.

Chairman of the House Committee on Finance, Hon. Abiodun Faleke, who presided over the session, commended RMAFC for its contribution to improved revenue mobilisation and fiscal accountability in the country.

Interference in local government finances has remained a contentious issue in Nigeria’s federal system for decades. Despite constitutional recognition of local governments, allocations are often managed through State–Local Government Joint Accounts, a system that has enabled some states to withhold or redirect council funds.

Analysts, labour unions and civil society groups have consistently linked the erosion of local government autonomy to poor rural development, weak primary healthcare services, declining education standards and the collapse of grassroots governance structures.

Recent Supreme Court rulings and renewed federal pressure have brought the issue back to national attention, with the Federal Government signalling a tougher stance, including possible executive measures, to enforce financial independence for local councils.

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