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Home Economy Fiscal Policy

Local Governments Deserve Bigger Chunk Of Federal Allocation

by Cee Harmon
3 years ago
in Fiscal Policy
Reading Time: 3 mins read
Yala-LG-kk
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In a federal system like Nigeria’s, the effectiveness of local governments at development is a major determinant of national development at par. But when local governments are starved of development funds or incapable of generating adequate revenue for development, national development becomes lopsided.

For instance, there is a plausible disparity in the percentage of paved roads in Nigeria because more than 65 per cent of Nigeria’s roads are resident in the third tier of government, which, in turn, has the most scarce resources among the three tiers.

But the current structure of revenue generation and allocation in the country would almost leave that important tier of government least capable of delivering the dividends of government to the grassroots if not altered.

Adequate and effective local authority indicates that government policies and activities reach the populace. The smooth running of the society needs to be cemented from the grassroots through adequate representations, policy formulations, implementations, and equitable distributions of resources and services.

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Nigeria is one of the few countries that adopted the federal system of government in Africa, a system that envisages autonomy for every sect of its authorities. Unfortunately, to suit their interests and political agenda, federal and state governments had maintained a substantial level of influence and control over local authorities over the decades. Consequently, LG effectiveness and performances have been largely hindered.

During the process  of  decolonization,  the  first elected  local government council was based on the British Whitehall model, in which a wide range of functions that  included  primary  education,  health,  police,  judiciary, autonomy  in financial, personnel  and  general  administrative matters were given.

Once independence  was  attained, between 1960-1966, there  was  decline  in  the  responsibilities  of  local authorities .

Between 1969 and 1971, a number of state governments introduced some changes in the structure of their councils. The first significant attempt of local authority reforms occurred in 1976, under  the  local government reform provision. The  provision  defined  local  government  as:  “Government at  local level exercised  through  representative  councils  established  by  law  to  exercise  specific powers within defined areas. These powers should give the council substantial control over local affairs as well as the staff and institutional and financial powers to initiate and direct the provision of services and to determine and implement projects so as to complement the activities of the state and federal governments in their areas, and to ensure, through devolution of these functions to these councils and through the active participation of the people and their traditional institutions, that local initiative and response  to  local  needs  and  conditions  are  maximised.”

Among  other  key points,  the above  definition strengthened  the  need for autonomy of the local government, ability to be elected at the local level and operate independently  of  the  state  and federal  government.

But the provisions made to the local governments for grassroot developmental projects are not commensurate with what would suffice for such development.

For example, it was in 1992 that General Ibrahim Babangida increased the LG allocations from 15 per cent to 20 per cent. But the Babangida administration further increased the number of local governments from 301 in 1976 to 453 in 1989, and 589 in 1991, while the Abacha regime further increased the number to 774 local councils. Increase in the local government council in Nigeria was a result of new states that were created.

So, while federal allocations were increased by Babangida from 15 to 20 per -cent, such policy vitiated the disposable income of local governments by increasing their number by subsequent policies that summed them to 774 local government areas.

With a culture of micromanaging local governments that have evolved over the years, they are naturally rendered ineffective.

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