Senate seeks inclusion of LGs in FAAC representation

The Senate on Tuesday, asked the Federal Government to include local government councils from the 36 states and the Federal Capital Territory (FCT) in the Federation Account Allocation Committee (FAAC) to represent their interest in the sharing of funds to the three tiers of government.

The Senate argued that this would bring the sharing of allocations in full compliance with the Supreme Court judgment, which ordered the direct disbursement of funds to the local governments as against through the states.

In a resolution the Senate passed in Abuja, it urged the government to appoint one local government council per state and the FCT to represent their interest at the FAAC.

The resolution followed a motion moved by the Deputy President of the Senate, Sen. Barau Jibrin, on “Urgent Need to alter the Composition of Federation Account Allocations Committee (FAAC) by including representatives of Local Governments and Area Councils.”

He argued that by virtue of the apex court’s judgment delivered in July 2024, funds were now to be released directly to local governments.

Jibrin also noted that the judgment automatically altered every earlier existing structure, such as the payment of local government funds through the state joint account, adding that the capping would be to have the councils represented in FAAC.

The motion reads, “The Senate notes that LGCs established by Section 7(1) CFRN 1999, as a 3rd tier of the Federation, are entitled as such and by Section 162(3) CFRN 1999 to share directly in Federation Account Allocations as benefitting entities;

“Also notes that the Supreme Court has construed Sections 162(5) and (6) CFRN 1999, to the effect that the States are agents of the Federation to collect Local Government allocations from the Federation Account and pay to LGCs and did not give the States any right or interest in the said allocations to the LGCs, from the Federation Account.

“The Supreme Court went further to also state that the duty of the states is to simply convey to the LGCs their allocations from the Federation Account;

“Aware that the Supreme Court has further recognised that the approach of a direct payment to the LGCs will achieve the intention and purpose of the Constitution and accord with the smooth running of the system of paying the LGCs their allocations from the Federation Account;

“Also aware that the Supreme Court has also pronounced to the effect that paying the LGCs through the states of the Federation has not worked, therefore justice demands that LGCs’ allocations from the Federation Account should henceforth be paid directly to the LGCs;

“Observes that section 5 of the Allocation of Revenue (Federation Account, etc) Act 1981 prescribes the membership of the Federation Account Allocation Committee (FAAC) to be only representatives of the Federal Government and State Governments to the exclusion of the 3rd tier of Government, i.e., Local Government Councils (LGCs);

“Also observes that this provision of the Act is no longer consistent with the current interpretation of Sections 162(5) and (6) CFRN 1999 as recently determined by the Supreme Court in its judgment of July 2024;

“Further observes that it is imperative to urgently harmonize the provisions of Section 5 of the Act with the Constitution and its current interpretation by the Supreme Court; and

“Aware that the representatives of the States had always represented LGCs at FAAC; however in light of the current position of the Constitution, as interpreted by the Supreme Court, it has become imperative that a representative of LGCs per State and Area Councils be nominated to represent their interest at FAAC.”

The Senate directed that the resolution be communicated to the Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, who doubles as the Chairman of FAAC, for necessary action.

It also sought the concurrence of the House of Representatives to give additional bite to the resolution.

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