Why FG Is Not Paying Allocations Directly to Local Governments – Abia ALGON Explains

The Chairman of the Association of Local Governments of Nigeria (ALGON), Abia State chapter, Chinedu Ekeke, has clarified the reasons financial allocations from the Federation Account are not paid directly to local government councils but are instead routed through the Joint Account Allocation Committee (JAAC).

Ekeke explained that the decline in direct financial inflows to local councils is linked to the Federal Government’s ongoing deliberation on how to implement the Supreme Court judgement granting financial autonomy to local government areas across Nigeria.

He made this clarification on Friday at the Abia State Government House in Umuahia, while responding to allegations from an opposition party member who accused Governor Alex Otti of diverting funds intended for rural development.

Speaking on behalf of other local government chairmen in Abia State, Ekeke dismissed claims that councils in the state were being deprived of funds needed to execute projects at the grassroots level.

According to him, allocations from the Federation Account are still paid into the JAAC system, which remains the operational structure for disbursing funds to local governments.

He noted that the Supreme Court ruling on local government financial autonomy has not yet been fully implemented, as the Federal Government is still reviewing the best approach to comply with the judgement without disrupting existing fiscal structures.

“Regarding the Supreme Court judgement, local governments receive funding through the JAAC because allocations are paid into the JAAC account. The funds do not come directly to the local governments,” Ekeke stated.

He further explained that the Federal Government appears to be examining mechanisms to properly address the judgement before making structural changes to how allocations are distributed nationwide.

Ekeke also emphasized that Abia local government councils are not being starved of funds by the state government, adding that the current process aligns with the existing framework used across many states in the country.