Governors of the 36 states of the federation may lose control of over N2.2 trillion revenue, which accrues to the 774 local government areas (LGAs) and oil-producing communities from the Federation Account yearly, if the planned autonomy for LGAs and the clamour for direct payment of the 13 per cent derivation funds to oil-producing areas is actualised. In the last one year alone, all the state governors have controlled an estimated N1.53 trillion revenue, being the LGAs’ share of allocation from the Federation Account. Each month, billions of naira are paid directly to the states instead of the councils, data gathered by LEADERHSIP Weekend have shown. In addition, the governors of oil- producing states have been controlling more than N565.86 billion paid to them as the 13 per cent derivation funds, rather than the oil- producing areas as stipulated in the country’s constitution. These figures are besides the other allocations accruing to the LGs and oil communities from draw-downs from the Excess Crude Account (ECA), which, when added together increase the revenue of the LGs and the oil communities currently controlled by the state governors by another N200 billion. The House of Representatives on Wednesday, after its votes on the amendment of the 1999 Constitution, granted autonomy to the local governments by altering the contentious Section 162 of the 1999 Constitution, which abrogated state joint local government accounts and empowers each local government to maintain its special account to be called “Local Government Council Allocation Account”. In the first half of this year, the LGs got N585. 672 billion from the Federation Account. The amount excludes their share of Value Added Tax (VAT), Excess Crude Fund, and others. A breakdown of the figures shows that the LGs got N84.665 billion in January, N106.442billion in February, N90.928 billion (March), N96.466 (April), N92.190billion (May), and N114.981 in June. The lower chamber’s move has now put elected local government chairmen in direct control of their allocations from the federal government rather than the state governors. The Senate has, however, rejected autonomy for the third tier of government, an action that has been condemned by some prominent Nigerians and groups. Another move that would also reduce the amount of money under the control of the state governors is the persistent clamour by communities producing oil and gas in the Niger Delta that the 13 per cent derivation fund paid to state government accounts be stopped as provided by section 162 (6) of the constitution. Instead, they are emphasising the need by the federal government to establish a national derivation board, which they insist would enable the communities manage money accruable to them. The oil areas in different memoranda to the Senate Committee on Constitution Review (1999), the federal government, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) and other relevant authorities have persistently insisted that the money ought to be controlled by the communities and not the state governments. However, the operation of the states/local governments joint accounts continued to ensure that the state governors maintain access to funds to the detriment of the communities. This is also likely to change with the abolition of the states/ LGs joint account by the House of Representatives. The chairman of RMAFC, Mr Elias Mbam, has supported the abolition of the state/local government joint account. Mbam declared that some of the state governors have defeated the aim of the joint account by trying to be “smarter than the constitution”. He therefore advocated the direct release of local government funds to them instead of into the joint account which places them at the mercy of the governors, adding that the local government councils were being treated from the federation account as a federating unit. He stated that the abuse of the state/local government joint account worries all Nigerians and that the situation can only be reversed through constitution amendment. According to him, “There have been allegations that local government and state joint accounts have been abused by some state chief executive officers. The commission has stated that the joint account should be abolished. Local governments should get their fund directly from the federal government but this will require the amendment of the constitution.” “The issue of joint account has continued mainly because it is stated in the constitution. The constitution when it was drawn was done with good intention because it was supposed to be one of the tools of development but now, it’s been greatly abused. The account was done so that it would be increased before sharing and not for state government to reduce it before sharing it,” he added. The RMAFC chairman, who also spoke on the high cost of governance, admonished the state governments to diversify their resources in order to generate more revenue to offset some of the overhead costs, while receipt from the Federation Account are channelled to infrastructure development. There have been persistent agitations by local governments in the country seeking to amend the constitution to grant them fiscal autonomy in order to check wanton abuses by state governors such as delay in release of funds to the LGs, wanton and arbitrary deductions by states and utilisation of the provision as a suppressive tool by the governors. In Niger State, the operation of the councils is based on the Local Government Act of 2001 as amended in 2012, authorising the operation of Local Government and State Joint Account. It empowers the state government to contribute 10 per cent of its internally generated revenue to the joint account. LEADERSHIP Weekend investigations revealed that instead of a defined statutory sharing formula, a centralised salary system is adopted where the councils collect their salaries’ cheque from the Ministry of Local Government irrespective of what is accruable to them from the Federation Account. It was further gathered that after the payment of salaries, all the local government councils get overhead cost of between N5 million and N10 million irrespective of what accrued to them from the Federation Account. On capital projects, the councils have to initiate projects that will be approved by the state government and money released based on the availability of funds in the joint account, even as the LG chairmen through the Association of Local Governments of Nigeria (ALGON) must issue a mandate to the ministry to pay from source any debt incurred on services provided to them collectively. The state governments, however, stated that they are against the autonomy for the councils because it would bring disparity in the councils in terms of what accrues to them from the Federation Account. The state commissioner for information, communication and integration, Professor Mohammed Kuta Yahaya, stated that the state government would not support autonomy for the councils because of certain variables of balancing up expenditures. He said the variables based on what is being sent to them from the Federation Account may not be able to pay salaries because it is too meagre. Yahaya further said that it should be noted that there are certain violations that are not the fault of the state government as being insinuated, adding that “certain violation where the federal government through UBEC takes care of primary schools and even deducts from source to fund operations is not normal”. Although most states of the federation are opposed to autonomy for the LGs, the Sokoto State government has described it as welcome development. Speaking on the state’s position on the issue, the special adviser, media, to the governor, Sani Umar, said the present administration “supports local government autonomy in its totality”. Another top official of the state told LEADERSHIP Weekend that the “joint account has and remains a cankerworm towards achieving the aim of establishing local government as the third tier of government in the country”. A member of the House of Assembly who also spoke to LEADERSHIP Weekend on condition of anonymity maintained that until some of the clogs in the wheel of the nation’s progress are addressed, Nigeria would not go anywhere. Meanwhile, the Nigerian Union of Local Government Employees (NULGE) has said it will embark on a nationwide strike on Monday to protest the Senate’s rejection of autonomy for the councils. The union accused senators of voting against the wishes of Nigerians who voted in support of autonomy for local governments during the public debate on constitution amendment held in the 774 local government areas of the country. The union’s general secretary, Comrade Joshua M. Irapakob, who spoke in Abuja, hailed the House of Representatives for voting in favour of autonomy for the councils. He said the union is not surprised about the decision of the House of Representatives on this topical issue in view of its doggedness in ensuring transparency, popular participation and accountability in the body polity. The union said it will still go ahead with its three- day warning strike from Monday to register Nigerians’ displeasure about the action of the Senate.
Posted on: Sat, 03 Aug 2013 06:22:52 +0000
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