Buhari moves against govs over LG funds

President Muhammadu Buhari is set to commence his second term with a resolve to stop the diversion of local government funds by state governors.

For years, state governors have reduced local government councils to an appendage of the states by denying them of their allocated funds, and diverting same to other uses, contrary to the provisions of the 1999 Constitution as amended.

This has rendered local government councils incapable of fulfilling their constitutional roles to the citizens.

To stem this tide, and ensure total adherence to the dictates of the constitution, two agencies of government, the Nigeria Financial Intelligence Unit (NFIU) and the Presidential Advisory Committee Against Corruption (PACAC), have sprung into action, determined to fight and punish further diversion of local government funds starting from June 1, 2019, three days into President Buhari’s new term.

The Nigeria Financial Intelligence Unit (NFIU), in a statement signed by Ahmed Dikko, its Acting Chief Media Analyst, issued a stern warning to financial institutions, public servants and other stakeholders that diversion of local government funds would attract heavy sanctions starting from June 1, 2019.

According to the statement, “With effect from 1st June, any bank that allows any transaction from any local government account without monies first reaching a particular local government account will be sanctioned 100 per cent, both locally and internationally.

“In addition, a provision is also made to the effect that there shall be no cash withdrawal from any local government for a cumulative amount exceeding N500,000:00 per day. Any other transaction must be done through valid cheques or electronic funds transfer.”

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It added that the Central Bank of Nigeria (CBN), the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices Commission (ICPC) have all been briefed.

This development will give full financial autonomy to the councils. It is not, however, clear how this will affect Local Council Development Areas (LCDAs) created by states but not recognised by the 1999 Constitution as it will be unconstitutional and illegal to allocate funds from the center to them.

The Executive Secretary of PACAC, Professor Sadiq Isah Radda, during a visit to Gombe State, also spoke of the determination of the Federal Government to ensure that as from June this year, all the 774 local government councils receive their full budgetary allocations. He added that the committee was working in collaboration with other agencies to stop the diversion of local government funds.

NFIU also said, “Having realized through analysis that cash withdrawal and transactions of the State, Joint Local Government Accounts (SJLGA), poses biggest corruption, money laundering and security threats at the grassroots levels and to the entire financial system and the country as a whole, decided to uphold the full provisions of section 162 (6) (8)of the 1999 Nigerian Constitution as amended which designated ‘State Joint Local Government Account into which shall be paid allocations to the local government councils of the state from the federation account and from the government of the state.’

“‘The amount standing to the credit of local government councils of a state shall be distributed among the local government councils of that state’ and not for other purposes.”

The statement added that “As far as the NFIU is concerned the responsibility of the account as a collection account is fully reinstated.”

NFIU stated also that apart from strengthening the third tier of government, the intervention would also scale down corruption and nip in the bud “the threats of isolating the entire Nigerian financial system by other international financial systems because of deficiencies in our anti money laundering and counter terrorism financing implementation.

“Therefore, it is no longer possible to allow the entire system to suffer the deliberate and expensive infractions or violations by public officials and/or private business interests. Henceforth, all erring individuals and companies will be allowed to face direct international and local targeted sanctions, in order not to allow any negative consequences to fall on the entire country.”