Why Financial Autonomy for LGAs is Not Enough

Postscript by Waziri Adio

It is difficult to marshal a credible and persuasive argument against local government areas (LGAs) getting all the federation allocations due to them. In fact, it can be argued that the LGAs should receive additional support and grants from the Federal Government and the state governments to enhance their financial viability, increase their capacity to discharge the critical responsibilities assigned to them, and reimburse them for acting as agents of the other two tiers of government. But it was never envisaged, and is simply indefensible and reprehensible, that LGAs would receive less than their statutory entitlements.

This is why the July 11^th ruling by the Supreme Court on direct federation allocations to the LGAs is right on the money. This is also why the state governors, who in most cases have not covered themselves in glory concerning LGAs’ allocations, have found it difficult to openly and coherently express their displeasure about the ruling. Good for them. But granting what has been excitedly termed financial autonomy to the LGAs is at best a good starting point. It is not enough. If the goal is to ensure good governance where it matters the most, the rest of us need to do much, much more.  

All Nigerians belong to, and live and work within, local government areas—be it villages, towns or municipalities. We are all citizens and residents of LGAs first before being same in states and the country. Being the first and closest level of government to all of us, the LGA is where we should feel the presence and the essence of government the most. Sadly, however, the local level is where governance deficit—alongside citizens’ disengagement—is the most pronounced in Nigeria. As I have argued on this page and in other platforms for more than 15 years, local governance is miserably broken in our country. And as desirable as it is, direct allocation to LGAs is not the cure-all that will bring local governance to good health in Nigeria. In actual fact, we should dispense with the thought of magic bullets.

Those who think financial autonomy will work the magic probably assume that our LGAs are underperforming simply because they are not getting all the money due to them or not getting the money directly. At best, this may be one of the reasons, but definitely not the sole reason. It has also been argued that once LGAs get their money directly and fully, they would be denied of any legitimate excuse for underperformance and that local accountability actors would spring up and be more active. Embedded in this view are two related assumptions: one, there is a link between full (as opposed to partial) receipt of federation allocations by the LGAs and optimal performance by the LGAs; and two, the reason why local accountability is constrained is because of partial disbursement of LGAs’ funds. The logic behind these assumptions is light.

Direct allocations to LGAs can actually produce the opposite of the desired effect. The money directly disbursed can be pilfered or thoughtlessly squandered or can be routed back to their political lords, the governors. Another possibility is that the well-resourced and unhindered LGA chairpersons can transform into mini-governors with their own well-oiled patronage networks and election war-chests, which can have grave implications not only for vote buying but also for social and political order. Talk about possible unintended consequences. These possibilities have led some to take the position that the Supreme Court ruling will change nothing, and may even make things worse. This is a cynical view. But cynicism is easy, and solves little.

The highest court in the land has ruled almost unanimously (6-1) to compel direct federation allocation to LGAs. The court also made consequential pronouncements on illegalities undertaken with impunity by states on local government matters. While it is important to acknowledge that even faithful implementation of the verdict will not automatically change things, the next order of work for those interested in changing the status quo is to identify, based on proper diagnosis, what else needs to happen to enthrone good governance at the local level in our country. In this piece, I will highlight three critical areas.

The first is that financial autonomy for LGAs must be accompanied with strengthening of the mechanisms for holding local officials to account. At the moment, accountability systems and structures are weakest at the local level. The checks and balances within government, provided through legislative and judicial oversights, through the presence of opposition parties, and through operational controls and procedures such as financial audits and restraining institutions, are hardly present at the local level. Local citizens are largely uninvolved or uninterested in local affairs. The press and civil society, which beam the searchlight on exercise of power and amplify citizens’ concerns, are more present and more active at the federal level.

The three forms of political accountability—horizontal, vertical and diagonal—are thus in short supply at the local level. Yet accountability is critical to good governance. Accountability doesn’t depend on the good nature of those in power. It has to be demanded—otherwise, it will not be supplied. Let’s be clear: the deficit in the demand and supply of accountability at our local level will not automatically be reversed simply because we are changing how money is disbursed. Following the Supreme Court ruling, there have been increased calls for citizens to hold their local officials to account. These calls are clearly well-intentioned. But the implicit assumption behind the calls is that local citizens were not holding their local officials to account because no one urged them to. It is a bit complicated, but the evidence suggests that incentive may be at issue.

The task then is to provide the incentives and the tools for citizens to exercise their agency as accountability actors, to fashion new accountability mechanisms for the local level and to strengthen existing ones. In furtherance of this, Agora Policy (which I lead) is co-hosting a solution-oriented dialogue on this issue with BudgIT, Yiaga Africa, Premium Times, Centre for Fiscal Transparency and Integrity Watch, and The Cable. Themed “Enthroning Accountability in Local Governance in Nigeria” and kindly supported by MacArthur Foundation, the timely policy conversation will hold on August 5^th in Abuja.

The second thing that needs to happen is that we have to improve the quality and content of democracy at the local level. Politics and decision-making at that scale should approximate the Athenian form of democracy. Local citizens should be able co-govern and should be able to decide the priorities of government at that level. The saying ‘all politics is local’ should have special resonance at the local level. Also, local politics is expected to serve as a school of democracy. But avenues for participation and learning and for enriching democratic practice are hardly present or used. The only option left is electoral democracy, and our local elections are clearly a total sham. No matter the diversity of political persuasions in a state, the party in power always records 100% success rate in local elections (except in FCT).

The Supreme Court has rightly ruled that LGAs are constitutionally required to be administered by elected officials (not by caretaker committees that governors prefer), that it is illegal for governors to dissolve democratically-elected LGA administrations, and that federation allocations should not go to LGAs without democratically-elected officials. It is in the news that most of the affected states are now rushing to schedule local elections. This is all well and good. But the issue is not about conducting elections just to fulfil all righteousness.

We need to significantly improve the quality of local elections so that those who emerge as elected officials are the real representatives of the local people and are those whose loyalty lies with the people, not solely with the state governor. Good governance has a better chance at the local level when there is a credible chance that non-performing officials can be thrown out at the next election.

In between elections, we also need to create avenues for citizens to have inputs into decision-making through public hearings, townhall/community/ward meetings and participatory budgeting. It is assumed that the closer the government is to the people, the more responsive the government will be to their needs. Periodic elections alone, even when they are clean and credible, will not be enough to make government responsive or to prioritise the needs of the people. In the space between elections, there should be constant opportunities for engagement between the officials and the people. Structured and continuous avenues for citizens’ participation will be key. If there is a space for us to test out forms of participatory democracy, the local level offers the ideal scale.

The last point I want to highlight is that building/improving local capacity will be critical.  Generally, the capacity for getting things done is low in our public sector. But, as with accountability, the state capacity deficit is most magnified at the local level. This shouldn’t surprise us: those really talented and driven will rather work at the federal or state levels, not in LGAs. Simply changing how we disburse money will not address this obvious capacity gap. Improving the capacity of the elected officials and civil servants on planning, budgeting, programme design and execution will thus be critical if our goal is to improve service delivery and overall governance at the local level. But it is not only the officials that need capacity enhancement. The citizens and the community-based associations also need support to enhance their interest and increase their capacity to engage the system at the local level more effectively.

I will end this intervention by repeating what I wrote in a related piece on this page about a month ago (‘Refocussing the Debate on Local Governance in Nigeria’). We need a comprehensive reform of how we approach local governance in this country. The Supreme Court has done what is within its remit. Other arms of government, expectedly, will do their bits. But enthroning effective, accountable and responsive local governance is a task beyond government. We all have roles to play too. And we should do our parts, for our enlightened self-interest. If local governance improves in the country, we should all be better off.