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Governors reject local Govt financial autonomy

Governors reject local Govt financial autonomy - under the, the nigerian, nigerian financial intelligence, Local, governors, financial intelligence unit, Financial

By Olisemeka Obeche

Thirty six state aegis of Forum (NGF), have registered their objection to the new regulations which seek to end controversial control of government finances by governors.

Intelligence Unit (NFIU), an agency carved out from the Economic and Crimes Commission (EFCC) by the federal government had set June 1, 2019, as the takeoff date of a new order which makes it compulsory for government allocations to go straight to their respective bank accounts.

The decision is contained in a guideline released by the NFIU after a lengthy meeting with officials of commercial banks in Abuja.

In its first official reaction, the NGF described the order which placed ban on transactions on state and local governments joint accounts and placing of a limit on cash withdrawals from local governments accounts to a maximum of N500,000 per day, as unconstitutional.

The governors in a statement issued on Sunday through the NGF’s head of media, Abdulrazaque Bello-Barkindo, also accused the NFIU of going beyond its constitutional corridor. The statement further revealed that the angry governors have already sent a protest letter to President Muhammadu Buhari, seeking his intervention in the ensuring imbroglio.

In the letter signed by the NGF chairman and Governor of Zamfara state, Abdulaziz Yari, the governors expressed “dismay and angst at this brazen attempt by the NFIU to ridicule our collective integrity and show total disregard for the constitution of the Federal Republic of Nigeria (1999) as amended.”

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The NGF made its grievance known in a letter titled Re: NFIU Enforcement and Guidelines to Reduce Crime Vulnerabilities Created by Cash Withdrawal from Local Government Funds Throughout Nigeria Effective June 1st, 2019, and dated May 15th, 2019.

The NGF chairman argued that nothing in the NFIU Act 2018 gives the body the powers that it seeks to exercise in the guidelines that it released and that the agency was acting in excess of its powers and with complete disregard of the constitution of Nigeria. It further accused the NFIU of “stoking mischief and also deliberately seeking to cause disaffection, chaos and overheat the polity.”

The NGF contends that local government councils are a creation of the constitution and are not financial institutions. According to the governors, local governments are not reporting entities and are, therefore, not NFIU in the manner contemplated by the NFIU so-called guidelines.

The statements read in parts, “In principle, the NFIU should concentrate on its core mandate of Anti-money laundering AML activities and Combating Financing Terrorism, CTF, as prescribed in the Act establishing it and should desist from encroaching on or even breaching constitutional provisions.”

“The Nigerian (NFIU) is the Nigerian arm of the global financial Intelligence Units (FIUs) once domiciled within the EFCC but now for the purpose of institutional location domiciled in the Central Bank of Nigeria.

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“This means the NFIU is only mandated to trace or track laundered money that finds its way into terrorism financing and report such to the nation’s security agencies. The NFIU should seek to comply with those standards on combating Money Laundering and Financing of Terrorism and its proliferation as stipulated and not dabble into matters that are both constitutional and beyond NFIU purview,” the governors said.

The governors said they extracted “copiously from the constitution” to draw the attention of the president to section (6) (a) and (b) “which confers on the states and national assemblies the powers to make provisions for statutory allocation of public revenue to the local councils in the federation and within the states respectively.”

The NGF argued further that Section 162 (6) expressly “provides for the creation of the States Joint Local Government Account (SJLGA) into which shall be paid all allocations to the LGAs of the state from the Federation Account and from the government of the state.”

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