The Association of Local Governments of Nigeria (ALGON) has announced that all 774 local governments will open dedicated accounts with the Central Bank of Nigeria (CBN) for the direct disbursement of funds from the Federation Account, following the Supreme Court ruling granting autonomy to the councils. The move, aimed at ensuring transparency and financial independence at the grassroots level, was confirmed by ALGON’s National President, Bello Lawal Yandaki.
In a statement made on Sunday, Yandaki explained that the CBN is awaiting directives from the Federal Government to begin opening the accounts for local governments, which could be completed in just 24 to 48 hours. He noted that any delay in the disbursement of funds was due to local governments not submitting the necessary bank details to the Federation Accounts and Allocations Committee (FAAC).
As of the January FAAC meeting, a total of N361.754 billion had been allocated to local governments, but administrative bottlenecks prevented the funds from being disbursed. Yandaki reassured that these issues would be resolved soon, and direct federal revenue allocations to local governments would begin by the end of January.
The National Financial Intelligence Unit (NFIU) will oversee the monitoring of these funds, ensuring that local government chairmen adhere to the principles of transparency, accountability, and good governance. Additionally, the government has set up an anti-corruption team, consisting of officials from the Independent Corrupt Practices and Other Related Offences Commission (ICPC) and the Economic and Financial Crimes Commission (EFCC), to prosecute any local government officials found guilty of fraudulent activities.
This decision to bypass state governments and directly allocate funds to local governments follows the Supreme Court’s ruling affirming local government autonomy. The move aims to curb the diversion of funds by state governors, ensuring that councils have full control over their financial resources.
Authorities have warned local government chairmen that any misuse of funds, including transferring bulk amounts to state governors, will result in prosecution by the relevant anti-corruption agencies. This step is seen as a critical move towards ensuring financial accountability and improving service delivery at the local government level, thereby reinforcing democracy in Nigeria.
The initiative is expected to have a significant impact on local governance, with experts asserting that it will strengthen financial management and contribute to more effective service delivery at the grassroots level.
