LG Autonomy: Governors Block Chairmen From Opening CBN Accounts

The challenges facing the implementation of the Supreme Court judgment on local government autonomy have assumed a new dimension, with some state governors explicitly warning their council chairmen against opening an account with the Central Bank of Nigeria for the direct payment of their allocations from the Federation Account.

The latest development represents yet another significant hurdle, nearly nine months after the Supreme Court granted full autonomy to the 774 local governments across the country, paving the way for direct payment of federal allocations.

As part of the Federal Government’s commitment to the Supreme Court judgment, a panel was set up to ensure the implementation of LG autonomy.

In line with its recommendation, the panel directed the Central Bank of Nigeria to open accounts for the 774 LGs for direct payment of their allocation.

This process has, however, faced delays with the CBN and LGs trading accusations.

The immediate-past Account-General of the Federation, Oluwatoyin Madein and the Attorney-General and Minister of Justice, Lateef Fagbemi, SAN, and other officials recently commenced talks on the modalities for the LGAs to open accounts with the CBN for direct allocation but are reportedly facing challenges identifying LGAs with democratically elected officials.

A Federation Account Allocation Committee Technical Sub-Committee meeting revealed that only Delta State LGAs had submitted their account details.

Amid the controversy, fresh investigations by The PUNCH on Monday revealed that some governors have resorted to intimidation and coercion, pressuring their local government chairmen to refrain from opening the designated accounts for direct allocation payment.

Several local government chairmen who spoke with our correspondents on the condition of anonymity, out of fear of victimisation, said their respective governors have instructed them not to open accounts with the CBN for the direct receipt of their allocations.

One chairman revealed that a governor in the South-East region refused to accept 50 percent of the monthly allocations, which was part of the agreement intended to facilitate the opening of the accounts for direct payment.

“Our governor has threatened us (all the chairmen in the state) not to open accounts with the CBN for the direct payment of our allocation”, one of the chairmen of South-East states, who pleaded anonymity, told one of our correspondents.

“We even tried to beg him, seeking to strike a deal, such that if he allows us to open the account with the CBN and our allocations are paid directly, we will remit 50 per cent of the LG allocation to him monthly, but he disagreed. So, this is where we are for now,” the LG chair added.

Further investigations reveal that a significant number of governors are strongly opposed to the opening of CBN accounts, fearing it would sever their long-standing access to local government funds.

However, a negligible number of governors are said to be disposed to the idea of their LGAs opening the CBN accounts.

The PUNCH had reported how some governors met with President Bola Tinubu recently and said they preferred the LGs to open accounts with commercial banks instead of the CBN.

It is unclear if the President is positively disposed to the idea.

Meanwhile, another LG chair, who spoke to The PUNCH on the condition of anonymity, explained that the CBN’s stringent conditions might be one of the reasons the governors were not positively disposed to the idea, aside from the fact that it will cut off their access to LG funds.

A chairman in one of the local government areas in South-West disclosed that the council chairmen in the state have not opened accounts with CBN due to the stringent conditions set by the apex bank.

The chairman said one of the stringent demands is the submission of a two-month statement of account from each local government area, which was not available.

“But as simple as that condition may look, all council areas here in our state can’t meet up. The situation is not peculiar to our state. If you check well, most states can’t meet up simply because their governors are the ones spending their allocation.

“They are only giving those in LGAs whatever they feel like giving them. That is the problem,” the LG boss said.

Other local governments have cited various reasons for the delay in opening CBN accounts. One council chairman in Benue State, who spoke to our correspondent on the condition of anonymity, alleged that certain parties are working together to hinder the process.

He said, “Chairmen across the country are aware that state governors are trying to frustrate the financial autonomy of local government areas. What they are pushing for is for council chairmen to open their accounts in commercial banks where they can easily have access to control the councils’ money.

“They know that the moment the money is paid to CBN, it will go directly to us, and they will not have access to it. So, that is the reason the governors are frustrating the move.”

However, the Nigerian Union of Local Government Employees in Nasarawa State has said it is fully compliant with the directive to open accounts and is prepared to receive funds from the Federal Government.

The NULGE Chairman in the state, Adamu Sharhabilu, who disclosed this to our correspondent in Lafia on Monday, revealed that the state government and the House of Assembly have been working in collaboration with local government workers to ensure that local government autonomy is fully realized in the state, showing a unified effort to support the implementation of the Supreme Court’s ruling.

He noted, however, that despite the cooperation at the state level, the local government councils have yet to begin receiving their allocations directly from the Federal Government

The NULGE chair said, “As I speak with you, all the LG accounts had been opened because we thought that the Federal Government will send our money there, but up till this moment, no LG in Nasarawa State has received allocation directly from the FG.

“For now, there are no obvious plans by the Nasarawa State government to short-change the local government workers or frustrate the LG Autonomy implementation in the state. From our own observation, the governor has been working towards ensuring that local government workers get what is due to them and also enjoy all the benefits of the LG autonomy.

“The monthly allocations are usually sent to the Joint Accounts under the State Ministry for Local Government and Chieftaincy Affairs. No local government has received funds from the Federation Account.’’

However, another local government chairman in the state, speaking anonymously, attributed the delay to the government’s failure to follow through on its promises.

The official stated, “What we are facing now is the fault of the Federal Government because the federal allocation committee is supposed to send the money straight to the local governments, not the joint account. We have so many accounts to receive the money, but they refused to send the money to the local government coffers.”

He, therefore, urged the Federal Government to align itself with the Supreme Court’s judgment and allow for the full implementation of the LG autonomy by ensuring that the funds are paid directly to the LGAs.

Findings showed that many state chairmen are unaware of the current stage of policy implementation.

The Chairman of the Nigeria Union of Local Government Employees, Kwara State chapter, Seun Oyinlade, hinted that no council has opened an account with the CBN.

Speaking on the phone on Monday, Oyinlade said, “We are not aware that any of the 16 local government councils in the state have opened an account with the CBN. We do not know if the local government councils in the state operate an account with the Central Bank of Nigeria.”

He said he could not confirm if the state governor was similarly opposed to the direct payment of allocation to the councils.

“Though we heard it as a rumour that governors are trying to frustrate the implementation of the local government autonomy, we are yet to verify the claim. We will confirm if the local government councils have accounts with the CBN when allocation from the Federation Account is paid to them,” he said.

A local government worker in Damaturu, Yobe State, revealed that March salaries were paid through the Ministry for Local Government and Chieftaincy Affairs, rather than directly from the local governments’ accounts.

He said, “This is a setback in the implementation of the Supreme Court’s ruling aimed at granting more autonomy to local governments.”

“Even the new minimum wage implementation, local government staff members are yet to benefit from it. The state civil servants have benefited from the new minimum wage approved by the Federal Government. This development has brought some relief to state employees.”

In Zamfara, local government chairmen confirmed that they have yet to open accounts with the CBN.

The state’s ALGON chairman, Alhaji Samaila Moriki, who also serves as the chairman of Zurmi Local Government Area, told The PUNCH that they were still awaiting further instructions before proceeding with the opening of accounts.

He said, “We have yet to open accounts with the CBN because we are waiting for further directives and instructions. Everything is done through due process, and we are waiting for the directives from above. So, that is why we have yet to open accounts with the CBN. We will do that later when things become normal.”

He, however, declined to make further comments on the directives and instructions they were waiting for.

Furthermore, the 44 local government councils in Kano State have yet to open an account with the CBN.

The chairman of Garko LGA, Saminu Garko, confirmed this, stating, “None of the 44 local government councils in the state has opened accounts with the Central Bank of Nigeria. But we heard that the apex bank has opened an account for all local governments, and what remains is to regularise the accounts.

“Moreso, the Central Bank of Nigeria has not invited any of the local government chairmen in the state for the regularisation of the accounts, let alone verification of signatories.

‘’We just read in the newspapers that the bank is inviting local government chairmen for the verification exercise.”

He noted that since the Local governments have not opened the accounts with the bank, there was no way the chairmen could be invited for the verification of signatories.

But the ALGON in Jigawa State denied that the governor threatened local government chairmen against opening accounts with the CBN.

The ALGON state chairman, Prof. Abdulrahman Salim, assured that the account opening process is ongoing. “Everything is okay, and our local government areas are still visiting the CBN state headquarters to complete the necessary procedures,” he explained.

Salim added that “All 774 local government councils, including the 27 in Jigawa State, are expected to open dedicated accounts with the CBN for direct disbursement of funds from the Federation Account as we were directed.

“Jigawa State’s 27 local government areas are taking steps to open CBN accounts, which will enable them to receive direct allocations and manage their finances independently.”

“The CBN has been instrumental in facilitating local government autonomy by providing a platform for local governments to open accounts and receive direct allocations,” he stressed further.

“The delay in opening CBN accounts has been attributed to administrative bottlenecks, including the failure of the apex bank to fix a date for the biometric data capturing to complete the process.”

He claimed that nearly all the necessary steps had been completed, with only biometric capturing remaining for some local governments, adding that “the chairmen are currently waiting for the CBN to schedule a date for them to revisit the office for biometric data capturing.”

The NULGE leadership in Jigawa State could not be reached to confirm Salim’s claims.

However, a NULGE official, who spoke on condition of anonymity, quipped, “It will not come to us as a surprise if governors really don’t want the local government autonomy, they can change the process entirely.”