The Federal Government has announced it will begin the active enforcement of financial autonomy for the 774 Local Government Areas (LGAs) nationwide.
The Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Dr. Mohammed Shehu, made the declaration on Thursday during the 2025 budget performance appraisal and 2026 budget defence before the House of Representatives Committee on Finance.
Shehu lamented the persistent encroachment by state governments on funds allocated to local councils from the Federation Account, a practice he blamed for the widespread dysfunction and poor service delivery at the local level.
“The Commission would like to establish a Local Government Committee now like we used to do before the Supreme Court said we were busy bodies. Now, we will monitor every single Local Government in Nigeria,” Shehu stated, signalling a new era of oversight.
He revealed that the initiative has the full backing of the Presidency, noting, “I’m glad that Mr President spoke to the governors himself, that ‘if you don’t allow this, I will issue an Executive Order.’ The Commission is fully in support of Mr President over this course.”
The RMAFC Chairman argued that the current crisis in rural development stems directly from the lack of functional local governments. “Even under the military, the local governments were performing much better,” he added, highlighting the regression in the current democratic dispensation.
A Decades-Long Challenge
The interference in local government finances has been a contentious feature of Nigeria’s federal system. Although the constitution recognises LGAs as a tier of government, allocations are often hijacked by state governors through the State-Local Government Joint Accounts. This has led to widespread withholding, deduction, and redirecting of funds, crippling local administration and stalling development in primary healthcare, education, and infrastructure.
Recent Supreme Court judgments affirming local government autonomy, combined with renewed federal pressure, have brought the issue to a head, with the current administration signalling its toughest stance yet.
Broad Reforms Underway
During the session, Shehu also updated lawmakers on other key reforms. He disclosed that the RMAFC has concluded an audit of oil assets in the Niger Delta and is finalising a new revenue allocation formula for the three tiers of government and political office holders.
“Remuneration of political office holders is completed. We have submitted this through the Secretary to the Government of the Federation to the President. We hope that very soon, this will be transmitted to you,” he said.
The Chairman commended the House Committee on Finance, chaired by Hon. Abiodun Faleke, for enhancing the commission’s regulatory clout, noting that revenue-generating agencies now proactively engage with the RMAFC.
In his response, Faleke praised the commission for its vital role in improving national revenue generation and endorsed the push for local government autonomy as critical for national development.
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