Charles Chukwuma Soludo, the Anambra State Governor, has said that granting absolute autonomy to local government authorities is ‘a recipe for humongous chaos’ in Nigeria.
He made this statement while addressing the media after signing the Anambra State Local Government Administration Law, a law that would mandate LGs to surrender a percentage of their federal allocations to the state government, on Tuesday.
On July 11, the Supreme Court ruled that all 774 Local Governments must receive their allocations directly from the Accountant-General of the Federation (AGF). Most importantly, the court declared it illegal for Governors to withhold local government funds.
However, Soludo argued that LG autonomy would not allow for sustainable development in the country.
“The absolute autonomy to the 774 local government areas in the country is an impossibility. In fact, it is a recipe for humongous chaos.”
The Anambra governor also argued that state oversight was necessary for properly implementing state autonomy in the country.
He said that section 7 of the constitution grants state governments the authority to enact laws to administer local governments under their jurisdiction.
“The attendant challenges before the issue of local government autonomy are such that would certainly deepen the fate of the system and spell doom for the expected beneficiaries of the process if not well planned,” Soludo added.
On Thursday, the Anambra legislature passed the “Anambra Local Government Administration Law 2024”.
Despite a Supreme Court ruling that granted financial autonomy to local governments across Nigeria, the law would make local governments in the state remit a portion of the allocations they receive from the federal government into a state government-controlled consolidated account. Speaking on the law, Soludo argued that it was pivotal for transparency in the local governments.
“The new laws by Anambra House of Assembly are therefore consequential to give operational life to the Supreme Court judgment and not to undermine it. If the State House of Assembly abdicates this constitutional duty, the Local Government will then have no law on the use and management of its finance,” the Governor said.
Speaking further, Soludo addressed the allegations that State Governors had been mismanaging local government funds.
According to the former Governor of central Bank of Nigeria: “It is equally important to understand that the Constitution mandated this collaboration between the States and Local Governments when in its section 7 (3), it provides that “it shall be duty of a local government council within the State to participate in economic planning and development of the area referred to in sub section 2 of this section and to this end, an economic planning board shall be established by a Law enacted by the House of Assembly of the State.”
“This provision gave rise to the establishment of the Anambra State Economic Planning Board of which all the local government chairpersons are members and who, among other things, decide on the percentage to be contributed to the Local Government Joint Account. It is important to appreciate that this money is not handed over to the State but remains with the Local Governments under a joint pool for the discharge of certain services by the local governments which services are uniform/common among the local governments as stated earlier.
“In sum, the laws ensure that the State can function in a cohesively planned, transparent and sustainable manner to maximize the security and welfare of the citizens. They constitute a very smart solution to a possible systemic threat.
“Governors are often accused of seeking to “control” LG funds with insinuations that LG funds are mismanaged. Of course, in a society where public office is seen as “dinning table” and public trust is low, people judge others by their own standards: by what they would do if they were in the position. I often ask: control for what? While I cannot hold brief for every governor, I know that most states are struggling to ensure a solvent local government system. I wish I can be spared the headache, if not for the predictable collateral damage to the system if we abdicate from structured oversight and collective accountability.
“The challenge ahead can be daunting given the quantum rise in wage bills because of the new minimum wage, as well as consequential rise in future pension/gratuity payments. Without active collaboration and coordination between state and local governments, many LGs will end up in a huge financial mess, requiring bailouts by state governments or will FGN directly intervene in every case of insolvency among the 774 LGs?
“In conclusion, the progressive legislations by the State Assembly are designed to unleash the creative powers of the LGs, encourage peer learning, optimal development outcomes in planning and execution among the LGs, as well as novel accountability and transparency. The laws are ingenious by creating multiple layers of collaborative oversight whereby the LGs agree on monies to set aside and managed collectively by them for common services or first-line charges, while the rest is appropriated by the Congress of Councillors in each LG.
“In an innovative sense, the legislative powers – including powers of appropriation and oversight now largely reside with the local government legislature—Congress of Councillors, which is empowered to make bye-laws, which are in the nature of regulations, for the Local Governments (as it is the House of Assembly that is empowered by the Constitution to enact laws to guide the Local Governments).
“Since neither the Constitution nor the Supreme Court judgment prescribes the manner of appropriation, expenditure, and audit/accountability for local government funds, the House of Assembly and the Congress of Councillors fill in the blanks under the new laws pursuant to Section 7 of the Constitution. The evolution of our federalism is a work-in-progress, and the new Anambra laws constitute creative and progressive additions to institution-building. May the Federal Republic of Nigeria continue to win!”