The Central Bank of Nigeria (CBN) has commenced profiling the chairmen and signatories to the bank accounts of the 774 local government areas in the country, as part of processes to commence local government autonomy.
The Director of Legal Services at the CBN, Kofo Salam-Alada, explained that this was necessary to ensure financial accountability.
However, the Association of Local Governments of Nigeria said it had received no communication from the apex bank concerning the opening of bank accounts.
Salam-Alada spoke at a state-of-the-nation discourse on strengthening local government autonomy in Nigeria, organised by the Nigerian Bar Association, in Abuja, on Wednesday.
On July 11, 2024, the Supreme Court delivered a landmark judgment affirming the financial autonomy of the 774 local government areas in the country and prohibiting governors from further control of funds meant for the councils.
The apex court also directed the Accountant-General of the Federation to pay local government allocations directly to their accounts, declaring the non-remittance of funds by the 36 states unconstitutional.
But eight months after the judgment, the financial autonomy has yet to take effect.
Providing an insight into the delayed fund disbursement, the CBN legal director disclosed that the apex bank had no direct banking relationship with the LGAs.
Salam-Alada stated, “This is all about standard procedure in the form of KYC (Know Your Customer). Anyone who will be a signatory to the account must be profiled. The process is ongoing, and we are collaborating with the AGF’s office. We have also written to the LGAs.”
He urged the Association of Local Government of Nigeria to encourage its members to engage with the CBN at the local level, assuring that once proper documentation is completed, the accounts will be operational within 48 hours.
“We are using this opportunity to call on the 774 local government chairmen to come forward for their documentation. No account can be operationalised without the prerequisite Customer Due Diligence,” he added.
But ALGON’s representative at the event, Sam Akala, disputed the CBN’s claim, stating that he was unaware of any official communication from the apex bank regarding the account-opening process.
“I cannot confirm that such communication has been received officially,” he said, affirming ALGON’s readiness to embrace its new role in grassroots development.
The Attorney General of the Federation and Minister of Justice, Lateef Fagbemi (SAN), represented by the Director of Civil Litigation at the Federal Ministry of Justice, Tijjani Gazali, said the LG autonomy would be implemented once the CBN process was concluded.
He explained that the LG autonomy implementation committee, which includes representatives from the Federal Government, ALGON and the Nigerian Governors’ Forum, had been working on a framework for the full implementation of the ruling, particularly regarding the direct payment of allocations from the Federation Account to LGAs.
“The committee is expected to complete its mandate any time from now and present its recommendations to Nigerians,” the AGF stated, adding that President Bola Tinubu’s administration remained committed to granting LGAs full autonomy.
He said, “Local government structures had almost become extinct in Nigeria, necessitating the intervention of President Bola Ahmed Tinubu’s administration. As a staunch advocate of democracy and the rule of law, the president took decisive action by filing a suit at the Supreme Court in May 2024. On behalf of the Federation, I brought the Attorneys-General of the 36 states before the Supreme Court to secure declarations ensuring the full emancipation of local governments in Nigeria.”
He condemned the continued illegal removal of democratically elected local government councils by some state governors, despite the Supreme Court’s ruling against such actions.
He described this as “worrisome,” criticising the “unconstitutional connivance by state governors and their State Houses of Assembly to dismantle democratically elected local government structures without recourse to the rule of law and replace them with their stooges.’’
“Let me state unequivocally that this act is tantamount to treason and must be treated as such. While it is true that section 308 of the Constitution grants governors immunity from prosecution, I wish to be clear that this flagrant disobedience to the Supreme Court judgment will have unpleasant consequences for the state as a whole, should it persist,” he warned.
Fagbemi highlighted the historical significance of local governments in Nigeria, stating, “Since pre-colonial times, the government has always been close to the people through well-documented traditional institutions that governed various ethnic groups. Today, local governments hold immense potential to drive sustainable development, foster inclusivity, and improve grassroots governance.”
In his welcome remarks, NBA President Mazi Afam Osigwe, emphasised the need for full local government autonomy, warning that failing to strengthen governance at the grassroots level could lead to greater national challenges.
Osigwe warned, “There must be democracy at the local government level. All other tiers of government must allow the LGs to breathe. If we fail to get it right at the LG level, we may be setting the stage for a greater calamity.”
Reacting to the CBN’s statement, the President of the National Union of Local Government Employees, Hakeem Ambali, said, “The failure to enforce this judgment is a huge disregard for the rule of law. It is highly disappointing that saboteurs have continued to fight against the implementation of a landmark Supreme Court judgement which allows for financial autonomy for local governments. On whether the CBN has now reached out to LGs for the opening of accounts, I can’t confirm that as of now but it is highly disappointing.”
