The Federal Government has restated its determination to end what it describes as long-standing interference by state governments in funds allocated to Nigeria’s 774 local government areas from the Federation Account.
The assurance was given on Thursday in Abuja by the chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Mohammed Shehu during the 2025 budget performance appraisal and 2026 budget defence organised by the House of Representatives’ Committee on Finance.
Shehu believed persistent encroachment by state governments had crippled local administration and undermined service delivery at the grassroots, adding that the commission was ready to take concrete steps to enforce financial autonomy for councils.
He disclosed plans to revive a dedicated Local Government Committee within the commission to closely track allocations and spending at council level nationwide.
“We will monitor every single local government in Nigeria,” he said, adding that President Bola Tinubu had personally warned governors against blocking local government autonomy and was prepared to issue an executive order if necessary.
Shehu argued that the decline in local government functionality lay at the heart of many of Nigeria’s governance challenges, recalling that councils were more effective even during the military era.
“The crisis we are having in Nigeria today is the lack of functionality of local governments, and every single one of us knows this,” he told lawmakers.
The RMAFC chairman also praised the House Committee on Finance, chaired by Lagos lawmaker Abiodun Faleke, saying its oversight had strengthened the commission’s standing among major revenue-generating agencies.
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According to him, agencies such as the Nigeria Customs Service (NCS), and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) now engage more proactively with the commission, helping to resolve issues that had lingered for years.
Shehu further revealed that RMAFC, with the committee’s backing, had completed an audit of oil assets across the Niger Delta and was close to finalising a new revenue allocation formula for the three tiers of government, alongside a review of remuneration for political office holders.
He asserted the remuneration review had already been forwarded to the President through the Secretary to the Government of the Federation, while work on the allocation formula was at an advanced stage and would soon be presented to the National Assembly.
After the session, Faleke commended RMAFC’s management for its contribution to improved revenue generation and fiscal oversight.
Control of local government finances has remained one of the most contentious issues in Nigeria’s federal system.
Although the 1999 Constitution recognises local councils as a tier of government, their allocations are typically channelled through State–Local Government Joint Accounts, a system critics say enables governors to withhold or redirect funds.
Civil society groups, labour unions and policy analysts have long linked the erosion of local government autonomy to poor rural development, weak primary healthcare and education, and the steady collapse of grassroots governance structures.