LGs Demand Direct Funding After States Receive Massive ₦7.43tn Payout

The Association of Local Governments of Nigeria (ALGON) and the National Union of Local Government Employees (NULGE) have expressed strong support for President Bola Tinubu’s resolve to enforce direct disbursement of local government funds from the Federation Account Allocation Committee (FAAC), amid continued control of council allocations by state governments.

At the 15th National Executive Committee meeting of the All Progressives Congress held at the State House Conference Centre in Abuja, President Tinubu called on state governors to comply fully with the Supreme Court ruling that grants financial autonomy to local governments.

He cautioned that persistent disregard for the judgment could leave him with no option but to issue an Executive Order mandating direct allocation of funds from the Federation Account to local councils.

The President’s warning followed the Supreme Court judgment of July 11, 2024, which upheld the Federal Government’s case seeking to enforce fiscal independence for local governments nationwide.

In a unanimous ruling, a seven-member panel of the apex court declared it unconstitutional for state governments to withhold, manage, or control funds meant for local councils. The court also ruled that the use of caretaker committees amounts to unlawful takeover of local government administration, in violation of the 1999 Constitution.

Despite the landmark judgment, implementation has remained sluggish more than 18 months later. Local government allocations have continued to pass through state governments, with delays and disputes involving the Central Bank of Nigeria, state authorities, local councils, and other agencies.

Available records indicate that state governments retained control of at least ₦7.43 trillion allocated to local government councils between July 2024 and December 2025, notwithstanding the Supreme Court directive mandating direct financial autonomy.

An analysis of FAAC disbursements, based on official statements from the Office of the Accountant General of the Federation, shows that local governments received ₦7.43 trillion over the 18-month period, even though the mechanism for direct access to the funds remained largely unchanged.

The total figure comprises allocations to the 774 local councils from July to December 2024 and throughout the 2025 fiscal year. Councils received ₦2.08 trillion in the second half of 2024, while allocations surged to ₦5.35 trillion in 2025.

Monthly FAAC data show that councils received ₦337.02 billion in July 2024, rising to ₦343.70 billion in August before dipping to ₦306.53 billion in September. Allocations rebounded in the last quarter of the year, climbing steadily to ₦402.55 billion in December.

Despite growing inflows, funds continued to be routed through the controversial State Joint Local Government Account system, leaving governors with considerable influence over council finances.

The trend intensified in 2025, with monthly allocations rising steadily from ₦361.75 billion in January to over ₦440 billion by mid-year. The highest monthly allocation, ₦529.95 billion, was recorded in October 2025.

In total, local governments received ₦5.35 trillion in 2025, compared to ₦3.77 trillion in 2024—an increase of ₦1.58 trillion, representing about 42 percent growth year-on-year.

The rise mirrored overall growth in FAAC distributions across all tiers of government. Total allocations increased from ₦13.91 trillion in 2024 to ₦20.28 trillion in 2025, while total distributable revenue rose from ₦15.26 trillion to ₦21.89 trillion.

However, concerns persist that continued state-level control over council funds is undermining grassroots development, despite higher revenue inflows.

ALGON and NULGE endorse Tinubu’s stance

Speaking in Abuja, ALGON Secretary-General, Muhammed Abubakar, reaffirmed the association’s backing of President Tinubu’s plan to mandate direct deduction of local government funds from FAAC.

He noted that the President addressed the issue directly with governors, grounding his position firmly in the Supreme Court judgment, which he described as the highest legal authority in the country.

According to Abubakar, the clarity of the President’s remarks leaves little room for misinterpretation, expressing confidence that governors would comply without further escalation.

He added that ALGON would fully support the President should he proceed with stronger measures if compliance remains elusive.

Similarly, the Bauchi State chapter of NULGE welcomed the proposed Executive Order aimed at preventing diversion of local government funds.

The state union president, Muhammad Yunusa, described the move as a long-awaited relief for local government workers, noting that financial autonomy has remained largely theoretical despite past legal interventions.

He expressed optimism that full implementation would strengthen accountability, improve workers’ welfare, and enhance grassroots governance nationwide.

In Kano State, NULGE Chairman Comrade Ibrahim Muhammad expressed cautious optimism, stating that although formal discussions on direct allocations had yet to commence, the union was satisfied with the current management of local government funds.

He praised the state administration for funding development projects and settling outstanding salary arrears, expressing confidence that the state would ultimately align with the President’s directive on local government autonomy.