Governors kick against move to grant Local Governments financial autonomy

An attempt by the Federal Government of Nigeria to grant local governments across the federation autonomy to control their revenue has received a backlash from the state governors.

Nigeria Governors’ Forum (NGF), the umbrella association of state governors in Nigeria, has petitioned President Muhammadu Buhari over move by the Nigeria Financial Intelligence Unit (NFIU) to separate the State Joint Local Government Account (SJLGA), a process whereby funds due to local governments from Federal Allocation are paid jointly with the states, leaving LGs at the whims of the state governors.

The NGF in a letter signed by its chairman and Governor of Zamfara State, Abdulaziz Yari, expressed dismay over NFIU action, describing it as an attempt to dabble into a matter that was beyond its mandate.

Yari accused the NFIU of “stoking mischief and also deliberately seeking to cause disaffection, chaos and overheat the polity”.

The NFIU, which was excised from the Economic and Financial Crimes Commission (EFCC), had set June 1, 2019, as the takeoff date of a new order, making it compulsory for all local council allocations to go straight to their respective bank accounts, against the current practice of a State Joint Local Government Account (SJLGA).

The decision is contained in a guideline released by the NFIU after a meeting with officials of commercial banks in Abuja.

Yari said in the letter, dated May 15 and released to the media yesterday, in Abuja, that the guideline was not only illegal but was also an attempt by the NFIU to show total disregard for the Constitution of the Federal Republic of Nigeria (1999) as amended.

He said Section 7 (6) (a) and (b) of the Constitution conferred on the National Assembly (NASS) and the State House of Assembly, the powers to make provisions for statutory allocation of public revenue to the local councils in the Federation and within the State, respectively.

“Similarly, Section 162 (6) of the Constitution expressly provides for the creation of the State Joint Local Government Account (SJLGA) 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.

“Section 162 (7) of the Constitution goes on to canter on the NASS the power to prescribe the terms and manners in which funds from the SJLGA may be disbursed and in Subsection (8), the Constitution empowers the State House of Assembly to prescribe the manner in which the amount standing to the credit of the Local councils in the State shall be distributed.”

The governor said that nothing in the NFIU Act 2018 gave the unit the powers that it sought to exercise in the recently released Guidelines.

He added that in doing that, the Unit had acted in excess of its powers and in complete disregard to the constitution of the country.

“The so-called Guidelines are in our view an exercise in mischief-stoking and one calculated to cause chaos and overheat the polity. The Guidelines have nine (9) previsions including two (2) sections covering sanction, penalties; powers that they clearly do not possess.

“The NFIU in proposing far reaching guidelines of this nature ought to have consulted widely and carried all stakeholders along,” the governors statement stated.

Yari urged President Buhari to call to order, Director of the NFIU, saying such “reckless guidelines had the potential to cause disaffection in the country.

He said that in principle the NFIU should concentrate on its core mandate of Anti-money Laundering (AML) activities and Combatting Financing Terrorism (CFT) as prescribed in the Act establishing it and should desist from encroaching on or even breaching constitutional provisions.

Yaro advised the NFIU that it should seek to comply with those standards on combating Money Laundering and Financing of Terrorism and its proliferation as stipulated and not dabble into matters that were both constitutional and beyond NFIU purview.

“We invite Mr President to note that the Local Government is a creation of the Constitution and is neither a financial institution nor a Reporting entity and cannot be brought under the NFIU in the manner contemplated by the guidelines. (RS/VANGUARD)