Local governments in Nigeria have financial autonomy – technically. Idayat Hassan, Director of the Centre for Democracy and Development in Abuja, reveals why they are still severely disempowered and what needs to be done to revive them.
Since Nigeria’s return to democracy in 1999, there has been a decline in the delivery of social services at the local government level due to overwhelming corruption, weak institutions and oversights. Health services are inadequate, there is limited potable water, primary education is in a comatose state, teachers are protesting against not being paid, and public infrastructure is poorly maintained. Yes, the situation is dire, but neither hopeless nor incurable. However, the lack of transparency and accountability in Nigeria’s local government system continues to be a significant hindrance to good governance.
Erosion of Democratic Local Governance
Whilst there are national institutional frameworks for decentralised governance and anti-corruption initiatives embedded in local governments’ civil service rules, these initiatives are operating in a challenging political and social context, preventing the adequate prevention of corruption at the local level. Typically it is asserted that decentralisation creates an opportunity for governance-driven development at the sub-national level, yet this may not be true in the case of Nigeria.
The essence of local government is, in theory, that it brings democracy closer to the people. In Nigeria, successive governors have failed to conduct elections at the local level, thereby eroding democratic governance. Instead of elected officials, so-called Caretaker Committees, mainly comprised of cronies, are appointed to local government offices. State governors select trusted party stalwarts to do their bidding and protect their interests. Political leaders, traditional rulers and youth leaders at the local level, who are loyal to governors, are being awarded contracts which they however rarely execute.
“Misplaced” State Allocations
The crux of the local government problem is fiscal. The official sharing formula of the statutory allocation from the federation account is the following: the federal government takes about 52 per cent, the individual 36 states get 27 per cent while the 774 local government areas are entitled to about 21 per cent. In practice, however, the state appropriates the 48 per cent accrual and grants a portion to the local government at its own discretion, using the State Joint Local Government Account (SJLGA) provision set out in Section 162 of the 1999 constitution. To address this challenge, the Nigerian Financial Intelligence Unit has issued an advisory forbidding the tampering with statutory local government allocations, granting local governments direct access to the funds.
However, the Nigerian Governors’ Forum – comprising the 36 state governors of Nigeria – are challenging this effort, which, if introduced, could go very far in tackling corruption. Indeed, data from the office of the Accountant-General reveals that 14.7 trillion Nigerian Naira (equivalent to 38 billion US Dollars) was allocated to the 774 local governments between 2008 and 2018, but that governors diverted a significant percentage of this allocation into state accounts.
The SJLGA is thus a crucial enabler of this corruption and continues to reduce the power of local governments. The “envelope system”, a reference to cash bribes accepted by officials, is a direct consequence of the joint account system and sees governors releasing funds to the local government without any budget justification. The money is often spent at the discretion of the chairman, treasurer and head of administration at the local council, most of whom are appointed by the governor – and the money disbursed to local councils by state governments is usually grossly insufficient. It is primarily used to pay staff salaries. This opaque system engenders corruption coupled with the fact that audits reports, when conducted, are only available to one or two individuals at the top of the local government structure in that area.
According to a respondent interviewed during research conducted by the Centre for Democracy and Development (CDD), even though audits are done quarterly by the Local Council Auditor and, monthly, by the council’s internal auditor, “findings are not communicated to anyone within the council except to the Chairman and Head of Finance. Because this is shrouded in secrecy, it becomes impossible to know if recommendations made are implemented. As a result, necessary actions could not be taken by those who are interested in bringing about change in the system.”
The Importance of Civil Society
The Nigerian political is skewed and councillors do not provide quality representation and accountability needed to promote good governance at the local level. This ongoing impunity has led to the continued underdevelopment in communities across the country. Unfortunately, one can observe that many citizens, perhaps out of frustration at being ignored for so long, refuse to participate in demanding accountability at the local government level. Yet, we need a vibrant civil society to break this vicious cycle and help foster capable local governments.
According to one individual with whom CDD has spoken to, “the major driver of corruption is society as a whole. They always expect more from you than you legally have. They want a salary earning, legislature to come and give them a scholarship, construct roads for them, buy a transformer for them. Where do they expect him to get the money from?”.
COVID-19 has further exposed the breakdown of accountability and functionality of the Nigerian local government system. Local government health care workers should be active in contact-tracing and quarantining COVID-19 cases, and in spreading awareness about the virus. However, due to frustration about the state of affairs, they are not doing any of these things and gradually also citizens are asking more and more “Why?”. Perhaps the COVID-19 pandemic is be the much-needed game-changer that leads to a renewed push for governance reforms at the local level. Here citizens and civil society have a key role to play in ensuring that all reforms must improve transparency and accountability in the delivery of basic services.