Introduction
The local government system has remained the foundation of governance in every democratic system, linking the grassroots, rural communities and other tiers of the government, as the case may be.Footnote 1 Nigerian democracy embraces this approach, with local governments as the base of governance, linking the grassroots and rural communities with the federal and state governments.Footnote 2 However, the conflict in the relations between the state governments and local governments has remained a challenge, and ignores the implications for effective grassroots participation in democratic governance and development under Nigeria’s federal system. The issue has remained the governmental structure, in particular the status and autonomy of local governments. To the state governors, the constituents of Nigerian federalism are the national and the state governments, including the Federal Capital Territory; the local governments are appendages of the states, existing at the whim of the state governments, who disregard the constitutional dictates guaranteeing democratically elected local government councils and the implicit intention that local governments should function as a third tier to ensure effective grassroots participation in democratic government and development.Footnote 3
This attitude of the states has hindered effective grassroots participation in democratic government and development. This has remained the case despite repeated judicial declarations on the constitutional status of local governments, in particular that the local government is the third tier of government and that no state government shall dissolve a democratically elected local government council and replace it with a caretaker committee or any other form of leadership.Footnote 4 It is in reaction to the continued disregard of the constitutional status and the responsibilities of the local government councils by the state governments that the Attorney General of the Federation instituted the originating action in Attorney General of the Federation v Attorney General of Abia State and 35 Others (AGF v AG Abia State) at the Supreme Court.Footnote 5
The Supreme Court, in its judgment, reaffirmed its earlier declarations that local governments are the third tier of government and that no state government shall dissolve a democratically elected local government council and replace it with a caretaker committee or administrator. It further declared that the federal government allocations to local governments should be paid directly, as opposed to the existing practice of payments through the state governments, and that local governments under caretaker committees or other forms of leadership outside a democratically elected leadership should be denied allocations from the federation accounts. However, the extent to which these judicial declarations and reliefs have guaranteed and restored the independence of local government councils remains an issue.
It is within this context that this article explores the extent to which the local government system is guaranteed as a viable third tier of government for effective grassroots participation in governance and development under the 1999 Nigerian Constitution. It further explores distortions in state and local government relations and the extent to which the Supreme Court’s declarations and affirmations in AGF v AG Abia State guarantee the envisaged functional independence of local governments for effective grassroots participation. The aim is to suggest other constitutional, policy and implementation measures that could be adapted for local governments as a functional third tier of government for grassroots participation under Nigeria’s federal system. This has become necessary because of the role and importance of grassroots participation in government in any democratic system, and in particular Nigeria, where the majority of the population lives in rural areas.
After this introduction, we start by exploring the concept of the local government system generally, the local government system in Nigeria and in particular under the 1999 Nigerian Constitution, and the Supreme Court’s position in AGF v AG Abia State. We also analyse the status of local governments in some other federal jurisdictions, before the conclusion and recommendations. We maintain that the Supreme Court’s declarations and reliefs in AGF v AG Abia State cannot guarantee the envisaged functional independence and autonomy of the local governments. As the state governments still treat local governments as their appendages, the need for unambiguous constitutional alterations therefore remains if the functional independence and fiscal autonomy of the local governments is to be guaranteed and achieved. The importance of strengthening local governments for effective grassroots participation in democratic governance and development cannot be overemphasized: a democratic government without such participation cannot be a government of the people. It is undisputed that the fountain of a liberal democracy is that sovereignty belongs to the people; hence it must be a government of the people, by the people, for the people. Scholars have emphasized the fact that “no democracy can become dynamic and sustainable if the systems of government at the grassroots level are not solidly people-centred, participatory and accountable”.Footnote 6
The local government system is therefore all about a relationship between the tiers of government that will accommodate grassroots participation in democratic governance through the local government system, and imbibe the indices of good governance as well as sustainable democracy and development for the people. The Nigerian Constitution embraces the principle of democracy, establishing a system of government that derives its authority from the will of the people. Leaders, including in local governments, must be elected by and are responsible to the people. Justice, freedom and equality, the major characteristics of a democracy, are also guaranteed under the Constitution.Footnote 7
The local government system
Local self-governance is as old as society itself and is the oldest form of public organization in human history.Footnote 8 It is of note that village dwellers organized themselves and their communities in several forms to achieve their objectives. A community organization for the community’s lives remained a form of government of the people, by the people, for the people, and a grassroots method of self-rule or governance. The main concern and focus were on how to meet the immediate needs of the people, without any intermediary between the people and the government.Footnote 9 This ultimately crystallized into modern-day local government in various communities or areas, with different styles of leadership and functions.
Thus the local government system has become a permanent and integral part of modern government, though with varying structures and styles of leadership, because of the role and services they render in their various areas and in governance generally.Footnote 10 The local government system is globally acclaimed as a cornerstone or bedrock of a people-centred democracy.Footnote 11 It is that level of government that is in constant touch with the population and serves as a barometer of government success or failure. This is particularly so in an environment where the majority of the populace lives in rural areas, outside the immediate influence of either the state or the federal government.Footnote 12
Uya has emphasized that no democracy can become dynamic and sustainable if there is no solid, people-centred participatory and accountable local government system at the grassroots level. It is maintained as a fact that even when the modern institution of government fails, it is usually at the local level that a semblance of government is sustained through local or traditional institutions, such as traditional rulership and other community associations.Footnote 13 In effect, the role and importance of local government, whether under a unitary or a federal system, cannot be overemphasized. The local government remains the key interface between the grassroots and the other tiers of government, which must be integrated into the general governmental structure for sustainable democracy and development. The mission is to bring the government closer to the grassroots, increasing the people’s understanding of and support for socio-economic activities that will foster their well-being. Thus local governments generally perform some specific and area-related functions in their areas of operation, to meet certain needs concerning their locality for rural development and transformation.Footnote 14
It must be emphasized, however, that the autonomy of the local governments for the effective performance or discharge of their roles and functions depends on the powers granted to them by the Nigerian Constitution and the law. This autonomy will also depend on the amount of revenue allocated to the local governments, the extent to which they are allowed to generate revenue, including on manpower and the sources of revenue to discharge their functions, supervision of expenditure and inspection, and relationships with stakeholders in the various areas. Hence the financial autonomy of the local governments cannot be compromised.
Even the United Nations recognizes the existence of the local government system as a political subdivision of a nation or a federal system, constituted by law and with substantial control of local affairs, including the power to impose taxes or exact labour for prescribed purposes.Footnote 15 The differences in local government systems, as noted, depend on their structure, leadership and relations with the other levels of government generally.Footnote 16 It is within this context that we here explore the local government system in Nigeria and the relationship between the local governments and the state governments.
The local government system in Nigeria
Local government in the colonial era
The local government system has been part of governmental administration in Nigeria since the colonial era. However, its name, nature and the form in which it has existed and operated has changed from time to time, depending on the particular governmental system and administration.Footnote 17 It was primarily designed to accommodate the heterogeneous nature of the people and their environments, with diverse ethnic nationalities, languages, cultures and religions, and to ensure stable service delivery at the grassroots levels for sustainable democracy and development. In any case, it has operated under the control of the regional governments.Footnote 18 The local government system has provided stable local administrations, which for the colonial government was the basis of the maintenance of law and order. It has also provided other social services, such as construction of roads, health services and general sanitation, primary education, policing, native courts and prisons in some cases, as well as agricultural and other rural services.Footnote 19
Local government councils in the colonial era and parliamentary system enjoyed a great deal of autonomy in financial matters, personnel and general administration, irrespective of the fact that they were under the control of the regional governments. The councils had adequate resources to carry out their functions, with block grants and special vote revenue mainly from the regional governments, and wide powers of rates and taxation to meet the costs of the services provided by them in most cases. However, for transparency and accountability, restrictions were placed on local government councils’ authority to award contracts and allocate additional funds for their expenditures.Footnote 20
Local government in the independence and military eras
The local government system and administration were retained after independence in 1960. The system remained under the control and supervision of the regions, still with varying governmental structures and administrations, until the military intervention in Nigeria’s democratic governance in 1966. The military government created states and stopped the regional system of governments under Nigeria’s federalism; this affected the functionality of the local government councils. The state governments took over most of the functions and sources of revenue of the local councils, which made the latter redundant and generally irrelevant in development processes.Footnote 21 However, the military government later realized the need for local governments for grassroots participation in governance and development, and therefore embarked on reviving them; this led to the 1976 local government reforms.Footnote 22 These reforms introduced a uniform single-tier system of local government with a defined administrative structure and functions between the states and the local governments, bringing to an end the varying local governmental structures inherited from the colonial era and the parliamentary system of government formed upon the independence of Nigeria.
However, the local governments, even though under a military government and the supervision of states, operated like a third tier of government and a legal entity. They shared the federation financial account with the federal and state governments and also had other independent sources of revenue. Local governments were seen as a viable instrument in governance and grassroots development in particular.Footnote 23 A strategic plan and projection for the local government system for effective grassroots participation in government and development were set out; in particular, the preamble to the Guidelines for Local Government Reform in Nigeria in 1976 discussed the local government system:
“Government at the local level is exercised through representative councils established by law to exercise specific powers defined in the [geographical] areas. These powers should give the Councils substantial control over local affairs as well as the staff and institutional financial power to initiate and direct the provisions of services and to determine and implement projects so as to complement the activities of the state and federal government in their areas, and to ensure through devolution of functions to those Councils and through the active participation of the people and their traditional institutions, that local initiative and responses to local need and conditions are maximised.”Footnote 24
Thus the 1976 reforms not only clarified the basic standards for effective local government autonomy, if it must respond to local needs and conditions; it also defined local government within the context of the foundation of grassroots participation in government and development.
Subsequent reforms were made to strengthen the autonomy of local governments. In particular, the Autonomy of Local Government Decree No 50 of 1991 stripped state governments of their supervisory roles in the administration of the local governments. The federal government had direct involvement in local government administration, and the Local Government Service Commission was established. The functions and responsibilities of the local governments were clearly defined, as was their financial autonomy. This was the situation until the return to democratic governance in 1979 under a presidential federal system, as enacted under the 1979 Constitution.
Local governments in the democratic era under the 1979 Constitution
The 1979 Constitution guaranteed the existence of democratically elected local government councils in the federation, but empowered the states to provide, under the law, for the establishment, structure, composition, finance and functions of the councils.Footnote 25 The state governments were to ensure that every person entitled to vote or be voted for at an election to a House of Assembly had the right to vote or be voted for at an election to a local government council.Footnote 26 The local governments, as a third tier of government, remained implicit in the Constitution; they had statutory allocations of public revenue from the federal and state governments and shared in the federation account.Footnote 27 However, section 149(2) of the Constitution provided that the “amount standing to the credit” of local government councils in the federation’s account shall be allocated to the states for the benefits of their local government councils “on such terms and in such manner as may be prescribed by the National Assembly”.
It is further provided in section 149(5), (6) and (7) that:
“5) Each State shall maintain a special account to be called ‘State Joint Local Government Account’ into which shall be paid all allocations to the local government councils of the State from the Federation Account and from the Government Account.
6)Each State shall pay to local government councils in its area of jurisdiction such proportion of its total revenue on such terms and in a manner as may be prescribed by the National Assembly.
7) The amount standing to the credit of the local government councils of a State shall be distributed among the local government councils of that State on such terms and in such manner as may be prescribed by the House of Assembly of the State.”
Even though these constitutional provisions departed greatly from the vision and missions of the local governments as envisaged under the 1976 local government reforms, the view remained that the local government is the third tier of the government for grassroots participation.Footnote 28 Nevertheless, the state governors did not see it that way; they capitalized on these gaps in the provisions of the Constitution to treat the local governments as appendages of the states. Thus the independence and autonomy of the local governments, enacted through the 1976 local government reforms and other military interventions, including the 1979 Constitution, remained a mission of unfulfilled hope.
The local government councils functioned under the control and superintendence of the states, and the state governments did not see the need for the operational and financial autonomy of the local governments. This made the local governments operate as agents of the states, with issues of misallocation and misappropriation of funds for and by the local governments. They became self-serving entities, spending their available funds in their areas on themselves, the politicians and their co-conspirators, as the states may have deemed fit, at the expense of the local government areas, democratic decentralization and area development. In effect, the local governments remained moribund under the Third Republic until a subsequent military intervention in democratic government in 1983. Unfortunately, this intervention did not revive the local governments, and they remained in a wishful state, waiting for renewed hope. This was the state of the local governments when Nigeria returned to democratic government in 1999.
The local government system under the 1999 Constitution
The existence, powers and functions of the local government
The 1999 Constitution, like the 1979 Constitution, recognized the existence of the local government system. Section 3(6) of the 1999 Constitution in particular specifies the number of existing local government areas in the various states of the federation and the six area councils in the Federal Capital Territory. Section 7(1) emphasizes and guarantees the existence of the system of local government by a democratically elected local government council; it also empowers the state governments to ensure the establishment, structure, composition, finance and functions of the local governments in the states under the constitutional process.Footnote 29 The state governments are also to ensure that elections for the local government officers, chairperson and councillors are conducted through the state electoral bodies.Footnote 30 However, the Constitution does not provide for the terms of office of local government councils, which is left for the states to decide. This lacuna has provided an impetus for the states to manipulate the administrative structure of their local governments; it has become an opportunity for either tenure elongation or the appointment of caretaker committees or other interim officers to run the local governments, as the governors may desire.
In the same vein, section 7(3) of the Constitution provides that “it shall be the duty of a local government council within the State to participate in economic planning and development of the area … and to this end an economic planning board shall be established by a Law enacted by the House of Assembly of the State”. We suggest that this has remained a fetter on the independence and autonomy of the local government councils, as they cannot embark on performing constitutional functions without a law made by the state House of Assembly. This is particularly so as the local government councils have no primary legislative powers under the Constitution, but can only operate through by-laws based on laws enacted by the Houses of Assembly. Even the establishment of a state economic planning board, through which the local government councils can participate in economic planning and development of their areas, has remained unfulfilled.
Furthermore, section 7(5) of the Constitution guarantees some specific functions of the local government councils as contained in the fourth schedule to the Constitution. For the effective discharge of these functions and responsibilities, the local governments are to share in the federation account.Footnote 31 They are also entitled to allocations from the state revenues, as the case may be.Footnote 32 These sources of funds are independent of internally generated revenues (IGRs) by the local governments. It was envisaged that these functions and responsibilities allocated to the local government councils would make them a functional and viable third tier of government. However, the extent to which they are allowed by the states to perform their constitutional functions, and the availability of funds for the effective discharge of any function, have remained major issues.Footnote 33 This brings into focus the issue of the status, functional independence and financial autonomy of the local government councils under the 1999 Constitution.
The independence and financial autonomy of local governments
One of the fundamental principles of a federal system is the independence and autonomy of the federating constituents under the Constitution.Footnote 34 This also extends to the local governments, as it is implicit that local government is the third tier of Nigeria’s federalism. Thus for local governments to be a viable and functional third tier, their independence and autonomy must be guaranteed and manifest in the powers and functions allocated to them under the Constitution. This will include the quantum of funds available to them for the discharge of their constitutional functions, the extent to which they are also allowed to generate revenues internally (IGR) and the sources of their IGR generally.Footnote 35
For effective discharge of the functions allocated to local governments under the 1999 Constitution, their revenues, and the sources of some of these, are also guaranteed under the Constitution. Specifically, section 7(6)(a)(b) provides that “the National Assembly shall make provisions for statutory allocations for public revenue to local government councils in the Federation” and that “the House of Assembly of the States shall make provisions for statutory allocations for public revenue to local government councils within the State”. In the same vein, section 162(3) is emphatic that any amount in credit in the federation account shall be distributed among the federal, state and local governments. Furthermore, section 162(5) of the Constitution provides that “the amount standing to the credit of Local Government Councils in the Federation Account shall also be allocated to the State for the benefit of the Local Government Councils on such terms and in such manner as may be prescribed by the National Assembly”. Similarly, section 162(6), (7) and (8) provides as follows:
“162(6). Each State shall maintain a special account to be called ‘State Joint Local Government Account’ into which shall be paid all allocations to the Local Government Councils of the State from the Federation Account and from the Government of the State.
162(7). Each State shall pay to Local Government Councils in its area of jurisdiction such proportion of its total revenue on such terms and in such manner as may be prescribed by the National Assembly.
162(8). The amount standing to the credit of Local Government Councils of a State shall be distributed among the Local Government Councils of the State on such terms and in such manner as may be prescribed by the House of Assembly of the State.”
By these provisions, it is not in doubt that the primary sources of revenue for the local governments are the federal and state governments, and the states are the conduits through which the local governments can access the funds from the federation account, and statutory allocations from states, for their developmental programmes.Footnote 36 This again raises the issue of the independence and autonomy of the local governments and the extent to which the states allow the local government councils to perform their constitutional functions and duties. It is a known fact that the states do not make the constitutional allocations to local government councils; even the allocations from the federation account to the states for the councils are retained by the states and centrally managed by them.Footnote 37 The sources of IGR for the local government councils can also only be stimulated by the indulgence of the states through the House of Assembly of the State.Footnote 38 These are clear inhibitions on the autonomy and functionality of local governments.
In short, the local governments operate without statutory budgets. Instead, funds are dependent on what the state governors are willing and ready to make available to the chairpersons or administrators, depending on their political party affiliations and personal relationships; in most cases, the expenditure patterns of the funds are dictated by the governors. No local government strictly performs any of its statutory functions, but only what may usually be agreed between the chairpersons or administrators and the governors. The implications of this for rural development cannot be imagined.
Moreover, section 2(2) of the Constitution provides that Nigeria shall be a federation consisting of federal states and the Federal Capital Territory – the local governments are not expressly included. Though section 7(1) of the Constitution guarantees the existence of democratically elected local government councils, the existence of the state governments can only simulate elected local government councils.Footnote 39 Curiously, the tenure of the local government councils is determined by the state governments, and it is also within the powers of the state governments to create new local governments following the conditions specified under the Constitution.Footnote 40 In addition, the state governments have the power concerning matters connected with the election of the local government officers.Footnote 41 Unfortunately, the judicial declarations and reliefs to curtail the political dishonesty and irresponsibility of the political class and their agents in dealing with the issues of the independence and autonomy of local governments as a third tier of government are yet to make any progressive impact.Footnote 42
Furthermore, section 128 of the Constitution empowers the State House of Assembly to direct or cause to be directed an investigation into governmental activities in the states, including local government councils, to expose corruption, inefficiency and waste in the spending of public funds and administration in the state generally, including in the local governments. No office in the local government structure can perform this function; unfortunately, it is the business of the Houses of Assembly or the state governors.
Curiously, the Constitution is silent on the executive, legislative and judicial powers of local governments as a third tier of government generally; these are limited to the federal and state governments.Footnote 43 This also raises the issue of the status of the local governments as a functional third tier under Nigerian federalism. Moreover, there have been calls from several quarters for alteration of the 1999 Constitution to expressly include the local councils in the structure of government. These calls for alteration have always emphasized strengthening the local government councils as an effective third tier for effective grassroots participation in government and development. Nevertheless, this has remained an unfilled mission.Footnote 44 These gaps in the Constitution have left the administration and control of the funds of local government revenue in the hands of state governments, which have relied on the omissions to enact local government laws and policies that have brought the operations of the local governments under the states’ manipulation.Footnote 45
For example, the State House of Assembly in Rivers State, relying on the provisions of section 7 of the Constitution, enacted the Rivers State Local Government Law 2018 which in particular empowers the governor and the House of Assembly of the State to sack or suspend a chairperson of a local government. It also empowers the House of Assembly to enquire at any time into the activities of a local government or direct the local government as it may deem fit.Footnote 46 Exercising these powers under the law, the governor (and even the House of Assembly of the State) has sacked some local government chairs for “insubordination”, as determined by the governor. The impact of this on the local government administrations, and the crisis in governance in the state generally, is still fresh in the memory.
In Akwa Ibom State, there was agitation by the local government councils about the state government withholding for years the local governments’ share of the 13 per cent they were owed from the derivation principle. There was also the issue of the impeachment of the chairman of the Uyo local government by the council and the setting aside of the council’s action by the governor, who claimed that the process of impeachment was unconstitutional. In Benue State, the state government decided to control the funds and resources of the local governments, under the pretence that the local government treasurers and directors of general services were misappropriating funds. The experience in Lagos State, where the state government stripped the local government of its role in traffic-control functions and the collection of tenement rates, cannot be forgotten; it is part of the impunity of the state governments to control and run the local governments. Most states also have a state Local Government Service Commission with the power to hire and fire staff on behalf of the local governments, hiding under the belief that the local governments are under the control and superintendence of the states, according to the Constitution. In all, the argument that the local government is an independent and autonomous third tier of government, designed to guarantee grassroots participation in governance and development, is seen as a mere academic exercise and is of no moment to state governors.Footnote 47
Attorney General of the Federation v Attorney General of Abia State and 35 Others
It is this crisis in the independence and autonomy of local governments that compelled the Attorney General of the Federation to institute an action through an originating summons against the 36 states of the federation in the Supreme Court in 2024.Footnote 48 The focus in this part is the outcome of this case, AGF v AG Abia State, and how it influences the autonomy of the local governments. The issue is the extent to which the Supreme Court judgment has influenced the local governments for effective grassroots participation in democratic governance and development within Nigeria’s federalism. Put another way, can it be said that the Supreme Court judgment is merely symbolic and has not had an impact on the operation and functioning of the local governments?
The dispute in this case was over the failure or refusal of the states to pay the local governments the allocations from the federation account after receiving funds from it for the benefit of the local government areas, as required under the Constitution, and the continued administration of local government areas by some states through caretaker committees, administrators or interim councils, contrary to sections 1(2) and 7(1) of the 1999 Constitution, and despite the Supreme Court declaration of the unconstitutionality of state governors running local governments through non-elected officers.Footnote 49 The case of the plaintiff was that since the states have for decades persistently refused to pay local government councils the money standing to their credit in the federation account, in violation of section 162(4), (5) and (6) of the 1999 Constitution, the federation can validly pay the said money directly to the local governments to protect the intention of the Constitution. Also, the governance of local government areas through the use of appointees or officers of states, such as local government caretaker committees, interim councils and administrators, amounts to governing or taking control of the government of a local area, contrary to section 7(1) of the Constitution and therefore also in violation of section 1(2). The above-mentioned acts of the states have endangered the continued existence of local government as a third tier of the federal governance structure, as most of them are now virtually extinct.Footnote 50
The case of the defendants, taken together, was that the federation cannot validly pay the money standing to the credit of the local governments in the federation account directly to them. To do so would violate section 162(5) and (6) of the 1999 Constitution, which requires that it be paid directly to the states for the benefit of their local government councils, that each state pay the same into a State Joint Local Government Account that it maintains, and that the states are entitled to retain the allocation and use it for the benefit of local government councils. They maintained that the failure of some of the states to organize the conduct of democratic elections for local government councils was not deliberate, as there were subsisting orders of courts in pending suits that restrained them from holding such elections in their states.Footnote 51
The Supreme Court, in a majority judgment, among other declarations, reaffirmed the existence of the local governments as the third tier of government in Nigeria and not the agents of the state governments, hence their independence and autonomy must be respected in the spirit of the federal system under the 1999 Constitution. It further declared again that the leadership of the local government councils must be democratically elected in compliance with section 7(1) of the Constitution, and affirmed the unconstitutionality of state governors creating caretaker committees or administrators to run local government councils in place of a democratically elected leadership, contrary to the Constitution. It declared that the continued retention of local governments’ funds and the use of the funds allocated to the local governments from the federation accounts by states is unconstitutional, illegal and contrary to the democratic principles intended to ensure that these funds are used for the benefit of the local communities, and thus the revenues due to the local governments from the federation account should be allocated to the local governments directly, unless the states are to fully and promptly transfer the funds to the local governments. This order is particularly necessary to revamp grassroots participation in governance through democratically elected local government councils in the spirit of Nigeria’s federalism, and makes it clear that the local governments under caretaker committees or other administrative arrangements should not share in the federation accounts.
According to the Supreme Court, it adopted a benevolent, broad, liberal, objective and purposive principle of constitutional interpretation in reaching its conclusions and making the declarations in this case. It maintained that to follow the narrow, strict, technical and legalistic interpretation would not promote the underlying policy and purpose of the Constitution.Footnote 52 Thus, relying on a plethora of judicial authorities, Agim JSC maintained that:
“In interpreting the part of the Constitution providing for governance in a constitutionally established democratic culture, the court must do so on the basis of principles that give the provision a meaning that promotes the values that underlie and are inherent characteristics of an open democratic society.”Footnote 53
Relying on the dictum of Nweze JSC in Saraki v FRN, Agim JSC summed it up when he emphasized that:
“The rationale of all binding authorities is that a narrow interpretation that would do violence to its provisions and fail to achieve the goal set by the Constitution must be avoided. Thus where alternative constructions are equally open, the construction that is consistent with the smooth working of the system, which the Constitution, read as a whole, has set out to regulate, is to be preferred … This approach is consistent with the ‘living tree’ doctrine of constitutional interpretation enunciated in Edward v Canada (1932) AC 124 which postulates that the Constitution ‘must be capable of growth to meet the future’.”Footnote 54
Based on these principles, Agim JSC, in the lead judgment, maintained that the approach of a direct payment to the local government councils would achieve the intention and purpose of the Constitution, and would also be in accordance with the intention for the smooth running of local government councils as a functional third tier of government. To the court, there was no doubt that a literal and narrow construction of the word “shall” in section 162(5) of the Constitution would impose a mandatory duty on the federation to pay the allocation from the federation account to the local governments only through the states. Nevertheless, that interpretation and approach would not be in the spirit of the Constitution. According to the court:
“As the facts of this case have shown, such a literal application would work against the intention and purpose of the Constitution and create an unconstitutional status quo, unworkable and oppressive situations. To apply the word ‘shall’ as making it mandatory for the Federation to pay Local Government allocations from the Federation Account through the States would make a constitutional provision prescribing the procedure to facilitate the enjoyment of a right created by the same Constitution to override and even extinguish the very right created by the Constitution, whose enjoyment it is meant to facilitate.”Footnote 55
His Lordship, referring to the repressive attitude of the state governors in their relationships with the local government councils, maintained that:
“In our present case, the person or body saddled with the constitutional responsibility to implement a method or procedure for the enjoyment of a right created by the Constitution is using that role to destroy that right. In a situation such as this, the Constitution should not be applied in a manner as to support the destruction of the said right.”Footnote 56
It has been claimed that the Supreme Court’s majority judgment has cleared the doubts about the independence and autonomy of the local government councils as a third tier of government; hence the local governments are no longer subordinate, under the control and superintendence of the state governments. Thus their financial autonomy, and the resources they need to carry out their constitutional and statutory functions and duties for the benefit of the grassroots and the development of the rural communities, are guaranteed and secured. We maintain that the Supreme Court’s majority opinion is in tandem with the prevailing view that the framers of the Constitution intended: that the local governments would function as the third tier of government for effective grassroots participation in democratic governance and development. Even though not expressly stated, the concept is implicit in the Constitution.
Nevertheless, the constitutionality and practicability of the Supreme Court declarations have remained a burning issue in Nigeria’s socio-political environment. Some have maintained that the Supreme Court was biased and misinterpreted the Constitution; moreover, the dissenting opinion of Abiru JSC concerning the financial autonomy of the local government councils and the federal government’s direct payments to them cannot easily be forgotten. Abiru JSC maintained that resorting to the mischief rule of statutory interpretation and the adoption of broad, liberal and purposive principles of constitutional interpretation is a misdirection and not in consonance with the intention of the Constitution; the wording of section 162 of the Constitution is generally clear and unambiguous. To Abiru JSC, a constitutional alteration would have been the answer, but that does not lie within the purview of judicial intervention as it is a legislative function; hence in the circumstances, the declarations and reliefs by majority judgment are unwarranted. According to him:
“The prayer of the Plaintiff that this Court should order direct payments of the funds due to the local government areas from the Federation Account to the local government councils by the Federal Government, and thus bypassing the States, is, in my view, an invitation to this Court to engage in judicial legislation and to interpret the provisions of the Constitution in a manner that will undermine the very foundation of the nature of the federalism upon which the provisions of the Constitution were constructed.”Footnote 57
No matter that we may applaud the majority opinion in this case, one must also not be oblivious to the fact that the local government councils’ sources of funds are not limited to the allocations from the federation account and grants from the federal government: allocations and grants from the state governments remain major sources of local governments’ funds. Even local governments’ drive for internally generated revenues is to be regulated through laws made by the Houses of Assembly of states. It is therefore not clear to what extent the Supreme Court’s declarations and reliefs will extend to the state governments’ control of funds from other sources outside the allocations and grants from the federal government. Thus a lot remains to be resolved in this regard, if the independence and financial autonomy of the local government as a third tier of government must be guaranteed.
Even though the federal government set up a committee on the implementation of the Supreme Court judgment, it is doubtful how the recommendations of the committee will be binding and implemented by the state governments. This is notwithstanding the fact that the federal government, state governors and local government chairs have signed an implementation agreement in this regard, which has remained an imperfect obligation, binding in honour only. The crisis in the independence and autonomy of the local governments is found in different forms every day.Footnote 58 It is no longer in doubt that the Supreme Court declarations and reliefs have not resolved the issue of the status of the local governments under the 1999 Constitution; it is merely symbolic, and does not have impact on resolving the crisis of the autonomy of the local governments in particular.
We therefore maintain that the only way out of this constitutional imbroglio will be alterations to the sections of the 1999 Constitution identified and discussed here. Before any detailed recommendations in this regard, it would be apt to explore the status of local governments in some other national federal jurisdictions for necessary guidance. We have for this purpose chosen the USA, India and Brazil, as they represent different generations of federal systems.
The status of local governments in some federal jurisdictions
As noted above, true democracy is predicated on the decentralization and devolution of powers. However, the extent of decentralization depends on whether it is a unitary or a federal system. The structure of government also varies depending on whether it is a unitary or a federal system, and on the socio-cultural system and environment. In a federal system, there may be a two-tier (national and state) or a three-tier system of government (national, state and local). In federal systems where the structures of government are limited to the national and state levels, that is, a two-tier system, local governments are not part of the federal structure but exist as part of the constituent states. Thus the existence and functionality of the local governments depend on the states. This is the situation in the USA, Australia, Canada and Switzerland. For instance, in the USA’s version of federalism, local governments are not part of the federating constituents; they are within the confines of the state’s structure, though they are designed to bring government down to the local level and afford participation in governance to people at the grassroots.Footnote 59 The nature, structure and functions of local governments also vary in the different US states, but the most common form includes multiple and overlapping units, such as counties, municipalities, townships, special districts, etc.Footnote 60 Their primary duties include the assessment and collection of taxes, maintenance of law and order, maintenance of roads, hospital and health services, mass transit, pollution control, social and welfare services, and other functions which the state may delegate to them.Footnote 61
Even though local governments in the US are under the control of state governments, they enjoy some relative autonomy in that they exercise a wide variety of powers. They are juristic persons that can sue and be sued, and have sources of revenue, even though their major source of revenue is from the states. They are democratically structured and administered. For the effective discharge of their functions, a good proportion of the state expenditure is given to the local governments, with stringent conditions attached to them. Most of the states’ grants to local governments are guaranteed for public education, social welfare, roads, hospitals, etc; thus the local governments have little discretion to exercise in terms of expenditure.Footnote 62 Overall, local governments in the USA function within a system where financial autonomy is shared and constrained rather than being fully independent.Footnote 63
In the Indian federation, the local government system is guaranteed and forms part of the constituents of the federal structure. There are three spheres of government: national (union), state and local.Footnote 64 The 73rd Amendment to the Indian Constitution requires states to create self-governing elected village councils, or panchayats, while the 74th Amendment requires the creation of elected municipalities in urban areas.Footnote 65 Thus the local government system consists of both urban and rural councils.Footnote 66 The state governments play a crucial role in the local government system; although local governments (both rural panchayats and urban municipalities) have constitutional recognition and autonomy through the 73rd and 74th Amendments, the states are responsible for setting up, regulating and empowering these local government bodies.Footnote 67
Subject to the Constitution’s provisions, the state legislature has the authority to enact laws that grant panchayats the necessary powers and responsibilities to operate effectively as self-governing institutions.Footnote 68 Their focus is on rural development and local governance, such as agriculture, rural housing, sanitation, drinking water, social justice, education, etc.Footnote 69 However, the Constitution mandates the state governor to constitute a state finance commission every five years, which reviews the financial position of the panchayats and makes recommendations on the distribution of financial resources between the state and panchayats, including the assignment of taxes, grants and financial powers to the panchayats. This helps ensure the fiscal viability and effective devolution of funds to panchayats.Footnote 70
A municipality is also an institution of self-government, covering an area in transition from being a rural area to an urban one, as determined by the governor of a state.Footnote 71 Their function covers urban governance, including city planning, urban infrastructure, water supply, sanitation, waste management, public health, etc.Footnote 72 The Constitution empowers the legislature of a state to enact laws authorising municipalities to levy, collect and appropriate taxes, duties, tolls and fees; it grants financial autonomy to municipalities by enabling them to generate their revenue through taxation, subject to a law enacted by the state legislature.Footnote 73 It also mandates the constitution of a finance commission for municipalities by the governor of a state every five years, which reviews the financial position of the municipalities and makes recommendations regarding the distribution of taxes, duties, tolls and fees between the state government and the municipalities, the allocation of financial resources across various municipalities and grants-in-aid to the municipalities from the state consolidated fund.Footnote 74
Thus in India, even though the local government system is guaranteed and is part of the constituents of the federal structure, the operational details are left to the states. The relationships between the local governments and the states usually pose no structural problems, because there are direct relations, task determinations and standard-setting; claims for assistance and supervision are handled cooperatively, even though the states set the framework.
In some other federations, like Brazil, the local government system is also explicitly guaranteed in the constitution as a third tier of government; thus the local government is part of the intergovernmental relations. The local governments have direct relations with the federal government, and their financial autonomy is guaranteed and secured. The local government structure consists of municipalities, each with its own directly elected head who leads the executive branch and a municipal chamber (legislative body) elected by the people. These municipalities are autonomous and their structure follows the state level, with separate executive and legislative branches.
The local government system in Brazil is constitutionally guaranteed and is distinct as a fundamental component of the federal structure under the Constitution, which guarantees the existence, powers, functions, independence and financial autonomy of the municipalities. Unlike many federations, where local governments are considered mere administrative subdivisions of states, Brazilian municipalities possess guaranteed independence from states and the union. They enjoy greater autonomy in service delivery, particularly in the provision of social services such as healthcare and education, with positive effects on social indicators.Footnote 75 Aside from the exclusive power given to the union and the collective powers exercised by it, states and federal districts also have concurrent powers to legislate on tax, on financial, penitentiary, economic and urbanistic law, on budgets, and on judicial procedures, among other things.Footnote 76 Financial autonomy is constitutionally entrenched to sustain the political and administrative independence of the municipalities. The proceeds of many federal and state taxes are shared with other tiers, but municipal taxes are not shared. More specifically, municipalities have the power to legislate upon matters of local interest, and can supplement federal and state legislations where pertinent, among other powers they can exercise.Footnote 77 However, the federal government tightly regulates tax collection and budget execution, which sometimes curtails the decision-making power of states and municipalities.
Overall, it is clear from the structure of the federating constituents under review that there is no generally accepted standard of governmental structure for a federal system; each country determines what it considers may be workable in the political environment. In effect, federalism varies from place to place and from time to time, depending on the factors that may be considered relevant and necessary, which may be historical, geographical, economic or political. Therefore what is good for one environment may not necessarily be good for another.
Nigeria has adopted its federal system, taking into consideration its historical, socio-cultural, geographical and economic environment, and implicit in its federal structure is local government as a third tier.Footnote 78 Nevertheless, the status of the local governments in the intergovernmental relations between them and the states has remained an issue. Resolving this issue through resorting to any of the other federal models, such as that of the USA, India or Brazil, may not be ideal, as the environments are not the same. The intergovernmental relations in Nigeria’s federal system, in particular between the local governments and the states, can only be resolved through constitutional alterations.
Conclusion and recommendations
This article acknowledges the crisis in effective intergovernmental relations between local governments and states that have arisen from the gaps in the 1999 Nigerian Constitution. It concludes that in spite of the Supreme Court’s declarations and reliefs, an effective and sustainable response to the issue would be constitutional alterations; the Supreme Court’s pronouncements are only a palliative to challenges to the status and autonomy of the local government councils under the 1999 Constitution. Moreover, the practicability of the judgment in terms of enforcement and implementation has remained precatory. In effect, the thirst to bring the local governments out of their moribund state and to secure their independence for the effective discharge of their constitutional functions and duties has not and cannot be quenched by the Supreme Court judgment. The need for constitutional alterations that explicitly bring the local governments within the federating governmental structure as a constitutional third tier of government, in order to ensure effective grassroots participation in democratic governance and development, yearns for legislative intervention.
We therefore call for constitutional alterations to sufficiently accommodate the principle of democratic decentralization, empowering and devolving responsibilities and autonomy to local governments as an administratively independent and autonomous third tier.Footnote 79 This will require, among others, the alteration of the provisions of sections 2(2), 4, 5, 6, 7, 162, 197(b) and 198 of the Constitution, in particular the phraseology relating to the status and autonomy of the local government councils, as they are clouded with ambiguities. Even the Supreme Court noted these ambiguities, hence the resort to the mischief rule of interpretation in the majority judgment. For instance, section 2(2) should be amended to expressly include the local governments as a component of Nigeria’s federation, while section 4 should be amended to establish the legislative powers of local governments, vesting the same in the local councils. The scope of the legislative powers of local government councils will be limited to their constitutional roles and functions, without the need to wait for the state House of Assembly to make laws to enable them to perform their constitutional functions and duties. This also applies to section 5 of the Constitution, which should be amended to establish the executive and judicial powers of local governments, vesting their executive powers in the chairpersons, in line with the Constitution. In line with section 6 of the Constitution, there are customary courts and sharia courts in the states; section 6 should be amended to vest the powers to establish such courts in the local governments. This is particularly important with the customary courts, as customary law and practice varies from one locality to another. The community heads and elites in the various localities can better understand the operational dynamics of the customary law.
As noted, section 7 of the Constitution has remained central in the issue of the autonomy of the local governments, hence the need for amendments if this autonomy is to be achieved. Section 7(1) should be altered to eliminate the powers vested in the states to ensure the existence, structure, composition, finance and functions of the local governments. The issue of the creation, structure and composition of local governments should instead be properly defined under the Constitution, and thus section 7(2), (3) and (4) of the Constitution should be deleted. The functions of the local government councils will remain as set out in the fourth schedule to the Constitution and not as may be conferred by laws made by the Houses of Assembly, as envisaged under section 7(5).
Furthermore, one of the areas of the noted inconsistencies, contradictions and controversies in the autonomy of the local government councils is in the allocation and control of funds and revenue, as reflected in section 162 of the Constitution. Though the Supreme Court has dealt with some of these issues on the surface, the need for alterations remains. Section 162(5) should be amended to give effect to the Supreme Court relief of direct payment to local governments, and section 7(6), (7) and (8) should be deleted. The alteration will also mean that the states will make allocations directly to the local governments, reinforcing the latter’s financial autonomy. These alterations, it is hoped, will guarantee the effective independence of the local governments as a third tier of government, hence strengthening the democratic decentralization of powers and the local governments for effective grassroots participation in governance and development.
However, as noted, some have maintained that an insistence on the rigid independence of local governments, as proposed, would mean giving the federal government control of them; in this view, this approach would undermine the intended grassroots participation in governance and development. The federal laws and policies for the administration of local governments would not take into consideration community and environmental differences in the local government areas to ensure grassroots participation.Footnote 80 To them, therefore, local governments should be under the control of the states, as is the practice in the USA and to some extent in India; after all, they say, Nigeria practises the US model of the presidential system.Footnote 81 This is not true, though: even though Nigeria may practise a presidential system like the USA, the constitutional details are different.
In any case, one thing is clear and central in all the arguments: the local government system in Nigeria is not fulfilling its mandate because of the constitutional lapses and manipulation of the system by the states’ governments.Footnote 82 This has made effective grassroots participation through the local governments under the present democratic dispensations an unfulfilled hope. The need for a local government system for effective grassroots participation in democratic governance and development therefore must be met. Whatever model would be adopted must be backed by constitutional and policy guidelines for local governments to perform their roles and discharge their functions for the benefit of local government areas; such guidelines must include budgetary and expenditure control, with implementation and enforcement mechanisms such as sanctions, as the Supreme Court has maintained. These will no doubt guarantee transparency and accountability in financial matters generally. Leaving the operational modalities of local governments to the discretion of the states is not the answer.
Competing Interests
None
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