The Federal Government, through the Federation Accounts Allocation Committee (FAAC), has yet to begin direct payments of allocations to local governments, despite a Supreme Court ruling in July 2024 that ordered these payments to be made into individual local government accounts.

This delay is due to unresolved operational issues, according to the Federal Government. The Supreme Court ruling was meant to give autonomy to local governments and improve transparency by ensuring their monthly allocations go directly into their accounts, without the interference of state governments.

The ruling gave the Federal Government a three-month period to work out the details of this new payment system. However, this period ended last week, and local governments are still not receiving direct payments.

The latest FAAC allocation for September 2024 amounted to N1.298 trillion. This amount was shared among the federal, state, and local governments. The Federal Government received N424.867 billion, state governments were allocated N453.724 billion, and local government councils were given N329.864 billion. Despite the court ruling, the local government funds were still paid into joint accounts shared with states.

The funds came from several sources, including N124.716 billion in statutory revenue, N543.518 billion from Value Added Tax (VAT), N18.445 billion from the Electronic Money Transfer Levy (EMTL), and N462.191 billion from exchange rate differences.

Local governments are still waiting for the promised direct payments that would provide them greater control over their finances and enable them to better manage local development projects.