From January 2025, Nigeria’s local councils will receive direct allocations from the Federation Account, following the Supreme Court’s ruling on financial autonomy.
The change aims to ensure timely disbursement without state interference, despite resistance from some governors.
Starting in January 2025, local councils in Nigeria will directly receive allocations from the Federation Account, following the Supreme Court’s landmark ruling in July 2023 that granted financial autonomy to local governments.
This decision ends the longstanding practice of channelling local government funds through a joint account with state governments, which often led to delays and interference.
Consequently, the new system will begin with the disbursement of this month’s allocation, ensuring councils can access their funds without state interference.
Although, a few local governments have already begun receiving direct allocations, the full rollout will take place in January 2025, impacting all 774 LGAs.
However, state governors have resisted this change, as they traditionally controlled local government finances.
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Nevertheless, the Inter-Ministerial Committee tasked with enforcing the ruling remains committed to its implementation.
“This is a crucial moment in Nigeria’s governance structure,” a committee member stated, adding that they will reconvene in January to assess progress and finalise plans for full implementation.
Moreover, concerns about state interference persist, particularly in Edo State, where the governor recently suspended elected local government leaders.
In addition, Anambra has passed a bill requiring councils to deposit part of their funds into a state-controlled account, raising doubts about compliance with the Supreme Court ruling.
Finally, President Bola Ahmed Tinubu has strongly supported the ruling, emphasising that local governments must exercise their constitutional right to autonomy.
This development marks a significant step toward strengthening Nigeria’s governance structure.
