Govs, Presidency disagree over management of LG accounts

Osun State governor, Gboyega Oyetola, on Tuesday disagreed with the Joint Account Allocation Committee (JAAC) system of revenue sharing between states and local governments.

Oyetola’s position tallied with that of other governors who, under the umbrella of Nigerian Governors Forum, insist that the law grants them right over management of local government funds.

The governor requested that the JAAC system of revenue sharing should be retained instead of the National Financial Intelligence Unit.

Meanwhile, the Presidency while responding to him declined his request, saying “after so many ruinous years, Nigeria certainly cannot live with the continued mismanagement of public funds” through the joint account.

The Presidency accused states of starving LGs of funds they need to discharge their statutory responsibilities.

Both Oyetola and the Secretary to the Government of the Federation, Boss Mustapha, made their submissions during the Nigerian Local Government Development Summit organised by SEGNIP Promotion Limited.

The programme had as its theme, “Emerging Issues in Local Government Administration in Nigeria.”

The Presidency said, “With joint accounts, they (LGs) have become inglorious units within the political system. There is no state, not even one, that showed example by devising a system that made the LGAs work. It is against this bleak background that the present administration of President Muhammadu Buhari has taken steps to upgrade the anti-graft/money laundering regulations with the NFIU guidelines to reduce vulnerabilities created by cash withdrawals from LG funds throughout the country.”

But while advocating the retention of JAAC, the governor said it introduced financial sanity into the management of the local government funds, adding that the NFIU would amount to engaging in an aberration.

Read also: Coalition threatens to shut down UK High Commission over P&ID’s $9.6bn judgment debt

While Oyetola was represented by his Chief of Staff, Dr Charles Akinola, the SGF was represented by the Director of Special Duties, David Attah.

Oyetola said, “Given its effectiveness, the JAAC system should be retained but modified by creating separate accounts for specific overheads after statutory deductions with a caveat that there shall be no cash withdrawals of more than N500,000, except for emergencies.

“The position of the NFIU to pay local councils’ allocations directly to the LG councils, for whatever reasons, contradicts some sections of the constitution. For the NFIU to achieve its aim, it shall have to press for and obtain an amendment to these sections and other relevant sections of the constitution.

“In a democratic dispensation like ours, issues are executed in accordance with the rule of law. This, in essence, is what informed the position of the Nigeria Governors Forum.”

But Mustapha said one of the major areas of friction between states and LGs had been the management of accounts, saying it had been  grossly abused “and it brought about serious agitation for the fiscal autonomy for the LGs.”

He said, “As important as all tiers of government are and as rightly recognised by our constitution, all of us, directly or tangentially, are exposed to the impact of LG administration daily.

“Therefore, mismanagement and maladministration at this level of governance will impact negatively on our people with direct implication for banishing a large number of the population to abject poverty and penury.”

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now