Policy Briefs

Nigeria’s moment of reckoning has arrived and it should be a season for purposeful leadership rather than a season of silly politics.  In a nation suffused with developmental and other unmet needs, the best national governance structure required to address those pressing needs — the local government — is being systematically truncated.  Whereas there is no such thing as a comprehensive strategy for purposeful governance, acknowledged global best practices which are in accord with international standards for democratic governance exist. We need to urgently replicate those values.  As the Buhari administration goes about its task of repositioning Nigeria, it must conflate its policy options of leveraging Nigeria’s vast population and natural resources with its unfettered support for the local government structures in order to make a difference. As things stand, most State governors in Nigeria continue to treat Local Governments as counterfeit institutions and at best; as their fiscal fiefdoms. This default disposition finds vigour and draws its impetus from the constitutional ambiguities on the status of the local governments and the attending self-serving argument by most state governors that the local government is not a federating unit. Consequentially, development at the grassroots is lacking, and federally allocated funds for local governments are disbursed and used as per the whims of governors.  In short, since local governments were constitutionally defined in 1976 and redefined in 1999, the States continue to stiff the institution and its allotted resources.   The time has come to set sentiments aside and salvage Nigeria’s LGAs in order to save our deformed and floundering federalism and our national population.

When in 1976 the Muhammad-Obasanjo regime initiated Local Government reform, it had clarity of purpose as evidenced by the enunciations of Gen. Shehu Musa Yar’Adua, the then Chief of General Staff. The local government reform was compelled by “…the necessity to stabilize and rationalize Government at the Local level” with “the decentralization of some significant functions of the State Government to Local level in order to harness local resources for rapid development.”  It was on this ambit that the Federal Military Government recognized local government as the third tier of government in Nigeria. Notwithstanding the foregoing provision and the subsequent reflections in the 1999 Constitution, for most state governors – past and present – discussing the autonomy of the local government is anathema.  Logically, the governors are not to be blamed.  They merely exploit an existing legislative lacuna.  Most won’t even acquiesce to holding constitutionally mandated local government elections. Indeed, some are already contemplating shifting scheduled LGA elections or abandoning the elections altogether and returning to use of Transitional Councils and running the local governments via executive fiats.  But were the funds allocated for local governments to be judiciously used, development in Nigeria would be markedly different. The growth of local institutions, infrastructure and services would have been exponential.  This is not to suggest that the system would be free of vices and excesses that hobble the federal and state governments.  Rather, the 744 local governments are truly what their assignation means: local.  They affect and respond to the local situations more directly and more positively than federal and state governments. This fact alone makes federal support for local government stability and economic wellbeing a strategic policy imperative.

Here is the Nigerian paradox. As commonly prescribed in various constitutions, in most federal systems local governments derive their powers from the State Constitution. Most local governments are thus insinuated administrative subsets, and subunits of the State, albeit, with restricted or very limited powers of self-government.  Contrastingly, in Nigeria, the local government is a constitutional creation and thus a federating unit, even if putatively.  But certain constitutional ambiguities persist. These ambiguities cost Nigeria much in progressive development. They also make good governance values and practice at the grassroots laggardly.  Ten years ago, a Goldman Sachs report projected Nigeria as possibly one of the 20 largest economies in the world by 2025.  Part of that target was met with our 2014 rebased economy, which made Nigeria the largest economy in Africa. Yet there is also room for growth if only we can overcome our strategic policy culture deficit. This policy challenge is more acute in handling entrepreneurship and good governance at the LGA level. Meanwhile, experts continue to stress that poor policy response will continue to slow or reverse past progress.

Incontestably, state and local governments often have a far greater impact on people’s lives than the federal government; the local government more so than the state government.  Traditionally, the local governments retain the remit, critical role and responsibility for maintaining peace and security, managing jails and detention facilities, collecting taxes, building and repairing roads and bridges, and recording deeds, marriages, and deaths. To a certain degree, they are responsible for community health centres, primary and maternal healthcare delivery, including immunizations.  These roles and services require funding far more than the LGAs can garner from designated tax windows. But these roles continue to suffer immeasurably thanks to State Government activities.  State governments now usurp unapologetically defined LGA functions. Putting the matter in its proper perspective requires paraphrasing President Paul Kagame of Rwanda, who in his May 2009 op-ed in the Financial Times, titled “Africa has to find its own road to prosperity” said,  “Government activities should focus on supporting entrepreneurship… because it unlocks people’s minds, fosters innovation and enables people to exercise their talents”. Foreclosing on our LGAs translates to foreclosing on our support for entrepreneurship and the unlocking our people’s minds and talents.

The crux of the local government problem is essentially fiscal.  The extant relationship between the state and the local government is not one of partnership. Rather, it borders on superior-inferior or custodial-minor interaction, akin to a fiscal relation between a parent and a minor. If the constitutional intent was to make the LGAs autonomous and truly independent and effective, then the provisions on the fiscal relations between the two entities as it relates to the Joint Account Allocation Committee (JAAC) policy, was wrongly construed.  Still, as the extant provisions of the Constitution of the Federal Republic of Nigeria (1999), state’s in Article 162(6), “Each state shall maintain a special account to be called “State Joint Local Government Account” into which shall be paid all allocations to the local government councils of the state from the Federation Account and from the Government of the state.” Hence, control of disbursement from JAAC is vested in the State. What the local governments get, when and how, becomes a matter of the caprices of the incumbent governor.   Furthermore, the States continued control of the JAAC translates to a granting veto powers to State Governments on the holding of democratic local government elections.  Already, problems of emasculated local governments are rife nationally.  Full blown crisis have ensued in Bayelsa, Rivers, Kogi, Abia, Kebbi and Plateau. Several states have postponed LGA elections over the past twelve months.  Explicably, across the nation, various chapters of the National Union of Local Government Employees (NULGE) continue to advocate the scrapping of the JAAC. The federal government must tackle the fiscal and constitutional ambiguities that have resulted in the emasculation of the LGAs.

There is nothing wrong with the JAAC in its intent and principle.  The problem is administering the account in line with acceptable global best practices of good governance.   A three-dimensional problem subsists. First, governors expediently interpret provisions of JAAC as permitting them to unilaterally make deductions from the monthly allocation to the local governments under whatever guise they can conjure and with whatever ratio they concoct. The LGAs inevitably get the residual funds, which are hardly sufficient to run their recurrent expenses, talk less of capital and developmental programmes expenses.  Second, the State executive and legislative arms — both beneficiaries — contrive JAAC laws in ways that tilt the laws in favour of the State.  Third, Local government representatives are not members of JAAC and where an LGA chairman is invited it’s because he or she is in cahoots with the State. Indeed, membership of JAAC is the exclusive prerogative of the State Governor, often in line with the already skewed legislation passed by the State Assembly.

As Bright J. Agbani, Robinson O. Ugwoke observed, in their 2014 paper on local government challenges, “The creation of the State Joint Local Government Account System (SJLGAS) by section 162 of the 1999 Federal Constitution of Nigeria was meant to facilitate rural development of the local communities through effective supervision of the distribution and efficient management of revenue accruing to the local government councils from the federation account….[ It was] “discovered that, rather than being a vehicle that should drive rural development, the State Joint Local Government Account system has served as a means of making unnecessary deductions from revenue accruing to the local government councils from Federation Account to the coffers of state governments in Nigeria.”  The vexatious and contentiousness of this issue led in part, to Lagos State vs. the Attorney-General of the Federation on which the Supreme Court  ruled that (a) “The Federal government has no power either by executive or administrative action, to suspend or withhold for any period whatsoever, the statutory allocations due and payable to Lagos State government pursuant to the provision of Section 162(5, 8) of the 1999 Constitution”; and (b) “Such withholding of due allocations is unlawful and contrary to the provisions of the 1999 Constitution.” Such a ruling ought to be made applicable to the States use of funds earmarked for the LGAs.  Curbing the present ambiguities in funding the LGAs will require a constitutional amendment or a revision of the Revenue Allocation Formula. Yet, the Federal Governments can in the interim tweak the modalities for releasing the allotted funds, so that the LGAs get their funding directly. If the States oppose such a move and autonomy, they should feel free to challenge the process legally.  If we seriously want to reposition Nigeria developmentally, we must first salvage our LGAs.

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• Obaze is a strategic public policy adviser and the immediate-past Secretary to the Anambra State Government.

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