The Central Bank of Nigeria (CBN) has commenced the profiling of chairmen and signatories to bank accounts of the 774 local government areas (LGAs) across the country as part of efforts to implement full financial autonomy for local governments.
CBN Director of Legal Services, Kofo Salam-Alada, explained that the move aims to ensure financial accountability and proper documentation before funds are disbursed directly to the LGAs.
Speaking at a state-of-the-nation discourse on local government autonomy organised by the Nigerian Bar Association in Abuja, Salam-Alada clarified that the apex bank does not have direct banking relationships with LGAs. He urged council chairmen to complete their documentation, assuring that once the process is finalised, the accounts will be operational within 48 hours.
“This is all about standard procedure in the form of KYC (Know Your Customer). No account can be operationalised without the prerequisite Customer Due Diligence,” he stated.
However, the Association of Local Governments of Nigeria (ALGON) said it had not received any official communication from the CBN regarding the account-opening process. ALGON’s representative, Sam Akala, maintained that the association remains committed to grassroots development but is yet to be formally contacted.
The push for local government autonomy follows a Supreme Court ruling on July 11, 2024, which affirmed the financial independence of LGAs and barred state governors from controlling their funds. The ruling mandated the Accountant-General of the Federation to pay local government allocations directly to their accounts.
Despite the judgment, implementation has been delayed. The Attorney General of the Federation and Minister of Justice, Lateef Fagbemi (SAN), represented at the event by Tijjani Gazali, Director of Civil Litigation, assured that full autonomy would take effect once the CBN’s profiling process is completed.
Fagbemi criticised some state governors for illegally dissolving democratically elected local government councils, warning that continued defiance of the Supreme Court ruling could have severe consequences.
“Local government structures had almost become extinct in Nigeria, necessitating President Bola Ahmed Tinubu’s intervention. His administration is committed to ensuring full autonomy for LGAs,” he stated.
He emphasised that local governments hold the key to grassroots development and inclusivity, stressing that state governors must comply with constitutional provisions to strengthen democracy at the local level.
