By Michael Chibuzo
President Bola Tinubu gave Nigeria’s democracy a major boost when he boldly went to war with the 36 state governors to affirm financial autonomy for the local governments in Nigeria as envisaged by section 162 subsections 3, 5, 6, 7 and 8 of the 1999 constitution as well as administrative autonomy as clearly provided in Section 7(1) of the constitution.
On July 11, 2024, the Supreme Court delivered a landmark judgement in which it clearly recognised the local government areas as the third tier of our federation and therefore must have elected officials at all times. It also declared as illegal, the retention and use of FAAC allocations belonging to LGAs by the states. The Supreme Court mandated the FG to send FAAC allocations to the 774 LGAs directly into their account.
The Supreme Court further declared that the federal government, which has a duty to enforce the provisions of the constitution, has the power to withholding FAAC allocations to any local government area without a democratically elected administration and outlawed the practice of State Governors dissolving elected local government councils.
In Anambra State, the ruling All Progressives Grand Alliance (APGA) has been trampling upon Section 7(1) of the constitution for a better part 18 years as successive APGA governors from Peter Obi, Willie Obiano and incumbent Prof. Charles Soludo appointed illegal caretaker committees to run the 21 LGAs in Anambra State. It did not end there, the APGA-led Anambra State government were also abusing the intention of the State Joint Local Government Account created by section 162(6).
Instead of the Anambra State Government under APGA sending its own revenue support for each of the 21 local government areas to the Joint account and adding it to the FAAC allocations for each of the 21 LGAs before sharing the combined sum to them, the APGA-led government in Anambra illegally withheld most of the FAAC allocations due to the LGAs and releases paltry percentages to their illegally appointed caretaker committees to use in the running of the local councils. To perpetuate this illegality, the criminal enterprise called APGA and its governors refused to conduct LGA elections in Anambra State for years.
The current Anambra State governor, Prof. Charles Soludo who prides himself as a democrat refused to conduct local government elections until the Supreme Court’s landmark judgement of July 11, 2024 forced his hand. Seeing that he will no longer receive FAAC allocations on behalf of the 21 LGAs in Anambra State if he did not conduct LGA elections, Soludo hurriedly conducted a kangaroo election, after engineering a shocking quickfire amendment of the ANSIEC law wherein he introduced obnoxious provisions that are self-serving and against fair play. This prompted major political parties including my party, the All Progressives Congress (APC) to boycott the election and head to court to challenge the ANSIEC amendment law.
If Soludo had stopped at the kangaroo local government election he conducted in which ANSIEC basically announced all the Caretaker Committee Chairmen that Soludo appointed just before the Supreme Court tsunami as winners of the local government elections in the 21 LGAs, it would have been manageable. At least the battle would just be about the legitimacy of the election. But Soludo was not done, his primary target was to return the 21 LGAs back to the pre-Supreme Court judgment servitude era where they had little say in the way they manage their resources especially FAAC allocations.
SOLUDO BRAZENLY ATTEMPTS TO CHALLENGE THE SUPREME COURT
In a direct challenge to the clear rulings of the Supreme Court as well as the good intentions of President Bola Tinubu on financial autonomy for the local government areas in Nigeria, the Anambra State Governor, Prof. Charles Soludo pushed the rubberstamp State Assembly to enact, within two days, a law known as the Anambra State Local Government Administration Law, 2024 in which Soludo basically tries to collect through the back almost every single kobo that the 21 LGAs in Anambra receive as FAAC allocations using various schemes that can best be described as criminal! Suffice to say that Anambra State House of Assembly now passes major legislation in record time with no public hearing whatsoever.
Soludo illegally collects 90% of LGA FAAC Allocations
In section 11 of the unconstitutional Anambra State Local Government Administration Law, 2024, Soludo basically stripped the 21 LGAs in Anambra State 90% of its monthly FAAC Allocation. The said Section 11(1) of the law provides for the main sources of revenue for the local governments and states as follows:
“The revenue and other funds of a Local Government shall consist of-
a) such proportion of money (10%) standing to its credit from-
(i) the State’s internally generated revenue and distributed to the LGAs of the state on such terms and in such manner as prescribed by the Anambra State House of Assembly; and
(ii) Allocations due to it from the Federation Account;”
Soludo went further in section 13 of the unconstitutional law to establish the State Joint Local Government Account and provided that the Anambra State shall pay into this special account “all allocations from the Federation to the Local Governments of the State”. In subsection 2 of that section 13, it goes on to say that “the state shall distribute the funds due to the Local Governments as provided in subsection (1) of section 11, on such terms and in such manner as prescribed by the State House of Assembly”.
In lay man’s language, what these two subsections of section 13 is saying is that every FAAC allocations accruing to the 21 LGAs in Anambra State shall be sent to the State Joint Local Government Account managed by Soludo. Soludo by this law would then distribute only 10% of this amount to the accounts of the LGAs as the amount they will use to run the local government. For example, in July 2024, Idemili North LGA received N588 million as FAAC allocation. Going by this law, Soludo will only give Idemili North LGA 10% of this amount, which is N58.8 million, to run the affairs of the council and he will retain N529.2 million. You may be asking, what then happens to the remaining 90%. We will get into that shortly.
Soludo criminally creates a Local Government Consolidated Account
The Professor of Economics who is the current governor of Anambra State, Charles Soludo in furtherance of his design to control the FAAC allocations of the 21 LGAs in section 14 of his unconstitutional Local Government Administration Law, established the LOCAL GOVERNMENT CONSOLIDATED ACCOUNT and stated that the consolidated account shall be administered for the “uniform provision of common services across all the Local Government Areas in the State.”
Soludo went further in subsection 3 to state that “each local government shall, within TWO WORKING DAYS from the receipt of their allocation from the Federation Account in a case where the allocations are received directly from the Federation Account for any month, remit to the Consolidated Account a percentage as determined by the Anambra State Economic Planning Board.” Soludo in Section 15 of that law then created a Committee to manage the local government consolidated account and guess what, in Section 15(2) of the law said that the signatories to the account shall be the Accountant General and two local government chairpersons (Mayors). However, withdrawal can be made from the account once the Account General and one of the two Mayors signs.
Soludo also criminally creates a Local Government Joint Security Trust Account
The next illegitimate account Prof. Charles Soludo created by virtue of Section 16 of the unconstitutional law is the LOCAL GOVERNMENT JOINT SECURITY TRUST FUND, which he said will be managed by the state government on behalf of 21 LGAs in Anambra State and shall be administered for “security purposes across the local governments in the state.”
In section 16(3), Soludo says that “each local government shall, within two working days from the receipt of their allocation from the Federation Account in a case where the allocations are received directly from the federation account for any month, remit to the Security Trust Account, an amount constituting 20% of the total revenue received by the local government for the month or any other amount as the Security Trust Account Committee may determine.
Summary of Soludo’s New Sharing Formula for LGA FAAC allocations
If you noticed, Section 14(3) was silent on the percentage of FAAC allocations belonging to the LGAs that should be remitted to the Local Government Consolidated Account. It was left to be determined by a body known as the Anambra State Economic Planning Board. However if you look at the provision of section 16(3) of this same unconstitutional law, which clearly provided that 20% of FAAC allocations to LGAs must be remitted to the illegal Local Government Joint Security Trust Account you will realise that as a matter of fact, 70% of FAAC Allocations to LGAs is expected to go into Soludo’s Consolidated Local Government Account every month. This means only 10% of the FAAC allocations belonging to the 21 LGAs in Anambra State will eventually get to them. How callous and dictatorial can Prof. Charles Soludo be?
Will Tinubu and his Attorney-General allow Soludo wreck the LG Autonomy victory?
What Soludo is trying to do in Anambra State is a direct affront on not only the Supreme Court judgment, which tried to guarantee the ability of LGAs to freely utilise their legitimate FAAC allocations to develop their locality, but also on the President himself and his Attorney-General, who took the pains to go through the judicial route to give the local government system a lifeline and oxygen breathe.
For long, the LGAs have been under the stranglehold of the state governors who seize their FAAC allocations and use them as they wish. The worse part is that these LGA FAAC allocations that governors seize do not appear in any part of their state annual budgets, so they are basically free money for these governors to embezzle. If this reality wasn’t clear before, the desperation of Anambra State Governor, Prof. Charles Soludo to hold onto 90% of FAAC allocations belonging to the 21 LGAs in Anambra State is enough evidence to tell you that they will do ANYTHING to control this free money.
Soludo has thrown the most audacious challenge to Tinubu, AGF Fagbemi and the Supreme Court. While the Supreme Court is not expected to do anything except a suit on this subject matter is brought before it, the President and the Attorney-General of the Federation can do something as part of enforcing the Supreme Court judgment using Anambra State as a scape goat. There a couple of options before the President and his AGF to pursue.
The President can direct that the FAAC allocations for the 21 LGAs in Anambra State be withheld if Soludo goes ahead to criminally extort the 21 LGAs 90% of their FAAC allocations in the name of implementing the obnoxious Anambra State Local Government Administration Law, 2024. This will force the Soludo administration to take the FG to the Supreme Court and that would afford the Supreme Court to nullify the Soludo law using Section 1(3) of the 1999 constitution as a basis.
A second option available to the federal government through the Attorney-General of the Federation is to arrest and prosecute any local government chairperson in Anambra State who remits 90% of the FAAC Allocation belonging to his/her LGA to Soludo under the guise of obeying sections 13, 14 and 16 of the Anambra State Local Government Administration Law, 2024. By the time these so-called Mayors are prosecuted and jailed for criminal diversion of public funds, sanity will prevail in Anambra State and by extension across other states mulling to follow the Soludo template.
MY CONCLUDING WORDS…
In my concluding words, as a concerned Onye Anambra, I am both enraged and perplexed at the desperation of Soludo and the hollow arguments his administration is making in defence of this unconstitutional act of financial desperation. Soludo says the law is necessary to engender collaborative development between the state and LGAs. Soludo argues that collecting 90% of LGA FAAC Allocations from them will ensure implementation joint initiatives, including provisions for the payment of gratuities, pensions, and salaries for primary school teachers.
Soludo’s Government argue further that withholding 90% of LGA funds by the state is also aimed at providing counterpart funding for Universal Basic Education projects and establish necessary oversight from the State House of Assembly to ensure accountability and proper governance. These are very laughable for many reasons. First and foremost, did it occur to Soludo to ask himself this question, if he collects 90% of LGA funds, is it only 10% that the LGAs will use to build internal roads, build parks, invest in Agriculture and cottage industries etc?
Collecting 90% of FAAC allocations to the LGAs basically means you want to cripple them or render them useless. The essence of the local government autonomy is to make the LGAs stand on their feet. To do that you should help them build capacity to generate more revenue through innovative means so as to be able to finance their primary responsibilities of primary education, primary healthcare, trunk C road constructions etc instead of trying spoonfeed them.
If an LGA cannot pay salaries of public primary school teachers and primary healthcare workers in its domain, this is an opportunity for it to reorganise itself because for a local government to have been created, it was deemed viable. If it becomes unviable due to mismanagement of its resources or cluelessness of its elected officials, then the House of Assembly can begin moves to merge it with another neighbouring LGA unless they sort themselves out. That is how you improve governance in the grassroot, not by taking over their funds to manage for them!
Finally, Soludo needs to read Schedule IV of the 1999 constitution which lists the functions of the local government and by extension some of their sources of internal revenue generation. The Anambra State Government under Soludo as of today is collecting internal revenues due to the local government. This should stop. Soludo needs to acknowledge that there is no particular version of federalism that is called “true federalism”, so he should grow up from his fixation that every federalism must have only two tiers of government.
Whether Soludo likes it or not, as of today in Nigeria, the local government is the legitimate third tier of government. If he wants to empower the LGAs to reasonably stand on their own, Soludo needs to allow LGAs to collect levies due to them. When the LGAs combine their FAAC allocations to their legitimate IGR, they will definitely have enough revenue to finance their basic responsibilities. The state will of course support them just like the federal government supports and partners with the states, but this partnership must not be coercive or one that mandates LGAs to submit 90% of the FAAC revenue. Soludo, this is the best time to stop this madness!