Wale Edun, Finance Minister and Coordinating Minister of the Economy, has said that the country’s fiscal structure must be re-engineered to fully implement the Supreme Court’s ruling, granting financial autonomy to the 774 Local Government Councils in the Country.
Speaking on Tuesday in Abuja at a High-Level Policy Dialogue on Local Governance Reforms, Edun acknowledged that while the Federal Government had enforced parts of the July 2024 judgment, particularly the restriction of federal allocations to unelected local governments, direct payments to all 774 Local Government Areas (LGAs) remain a work in progress.
The dialogue, the second in the series, focused on “Local Governance Reforms: A Year After the Supreme Court’s Ruling” and was organised by Agora Policy in partnership with Centre For Fiscal Transparency and Public Integrity, The Cable and supported by MacArthur Foundation.
“The primary funding structure is one that will need to be very much tinkered with in order for the complete direct payment of funds to each individual local government,” Edun said, citing the complexities around primary health care, education funding, and State-level joint accounts.
Edun emphasised that implementing the Supreme Court’s ruling requires “determination, political will, and capacity,” and warned that execution is not as simple as “flipping a switch.” He described the process as gradual and collaborative, requiring coordination across all levels of Government.
He highlighted how in the past year, the Federal Government had moved to enforce key elements of the Court ruling despite teething challenges. “No Local Governments that are not democratically-elected should have access to funds from the federal government,” Edun said, citing the Lagos local elections earlier this month, and several others already held in all the states and FCT as aligning with that directive.
While the ruling was seen as a breakthrough for grassroots governance, Edun stressed that broader development goals underpin its importance. “The Local Government System is fundamental to the unique agenda of the Administration in delivering the gains of economic reform,” he said.
Assuring that the Tinubu-led Administration is committed to grassroots development, Edun outlined several federal programmes targeting Local Governments, including the Nutrition 774 initiative and Project 774 Local Government Connectivity, aimed at addressing malnutrition and digital infrastructure gaps, respectively. He also highlighted the World Bank-backed Human Capital Opportunities for Prosperity and Equity (HOPE) programme and performance-based funding in health and education.
Despite implementation lags, Edun reaffirmed the Administration’s commitment to the rulling. “We have a sound law as laid down by the Supreme Court,” he said. “It is the collaboration, cooperation, and determination of all that will be paramount in ensuring we achieve fiscal autonomy for Local Governments.”
Victor Muruako, Chairman, Fiscal Responsibility Commission (FRC), called on Local Governments to anchor that Supreme-Court-backed autonomy on “fiscal transparency, accountability, and prudence.”
Muruako emphasised that the Court ruling was “not merely a legal milestone, but a clarion call to restore dignity, functionality, and independence to the tier of government closest to the people.”
While welcoming the autonomy as an opportunity for grassroots development, Muruako warned that “autonomy comes with great responsibility,” adding that the FRC is poised to support Local Councils with fiscal frameworks to guide sustainable public finance practices.
“Local Governments now have the opportunity to approach banks and other financial institutions for borrowing to fund development projects,” he said. “I strongly advise LGAs to exercise caution and adhere strictly to the terms, conditions, and limitations outlined in the Fiscal Responsibility Act.”
Describing the autonomy as a potential “fiscal renaissance,” Muruako urged stakeholders to translate the ruling into “tangible results for citizens,” reinforcing the urgency for LGAs to enact fiscal responsibility bye-laws.
In her goodwill message at the dialogue, Deborah Isser, Lead Governance Specialist at the World Bank, underscored the pivotal role of Local Governments in Nigeria’s governance framework, stating: “Local Government, as the authority closest to the people, is in the best position to make decisions that address local preferences and needs.”
Isser acknowledged the political and structural challenges slowing the implementation of the Supreme Court ruling on Local Government autonomy, stressing that “some State governors simply do not want to lose the power they have over the people and budget of local governments,” while others cite concerns over capacity and accountability at the local level.
Stressing that Government’s ultimate purpose is to provide essential services, she urged a shift in focus from legal debates to practical reforms that build trust, capacity, and collaboration among federal, state, and local governments.
She reaffirmed the World Bank’s commitment to supporting these efforts, including through the HOPE initiative.
In her welcome address, Ojobo Atuluku, Chair of Agora Policy, corroborated that the Supreme Court judgment was “not merely a legal milestone; but a constitutional reaffirmation of the principle that local governance must be closer to the people, more transparent, and more accountable.”
She noted Agora Policy’s swift response with policy notes urging reforms beyond the courts to empower Local Governments as “effective democratic institutions.”
Atuluku called for “roots-and-branch reform” to dismantle patronage and rebuild “transparent, accountable, and citizen-driven institutions.”
Highlighting political will and capacity as essential, she introduced the forthcoming Local Governance Accountability Portal to track FAAC allocations and LGA profiles, a “powerful tool for genuine local governance systems development.”
Speaking during a panel session at the event, Bello Yandaki, National President of ALGON, emphasised that “Local Government has the capacity to cater for its obligations” but currently lacks access to funding, which limits service delivery and accountability.
He stressed, “Government is a function of funding,” and assured that ALGON is building local administrators’ capacity to manage funds judiciously.
Highlighting electoral reforms, Yandaki, who was represented at the session, called for “a more independent electoral body” to conduct uniform Local Government elections, ensuring transparency and genuine citizen participation, and ending governors’ undue
