LG Financial Autonomy:Senate Asks FG To Include Local Governments In FAAC Meeting

Nigerian Senate has asked the Federal Government to ensure the inclusion of one representative from each local government council across the states, and one per area council in the Federal Capital Territory in Federal Account Allocation Committee deliberations, as part of strategic moves to actualize the financial autonomy of the third tier of government 

The Senate also directed that its resolution be communicated to the Minister of Finance and Coordinating Minister of the Economy, Wale Edun who serves as the FAAC Chairman, for immediate action.

The resolutions, in a move  sponsored by 

Sponsor of the resolution, Senator Barau Jibrin (Kano North) explained that the resolution was aimed at strengthening constitutional compliance and financial transparency at the grassroots level

He emphasised that Local Government Councils, as constitutionally recognised third-tier governments under Section 7(1) of the 1999 Constitution (as amended), are entitled to a direct share from the Federation Account.

The Senate cited the Supreme Court’s ruling, which clarified that state governments act merely as conduits for transferring LG allocations and hold no ownership or discretionary powers over those funds.

The lawmakers further highlighted that while FAAC currently includes only representatives of the federal and state governments, Section 5 of the Allocation of Revenue (Federation Account, etc) Act 1981 excludes local governments, a provision now deemed inconsistent with the Constitution, following a landmark Supreme Court judgment delivered in July 2024.

The Senate further noted that while state governments had historically represented local governments at the FAAC, the evolving legal interpretation now necessitates direct representation to safeguard local government interests and enhance transparency in revenue sharing.