Court dismisses governors’ suit against NFIU on regulation of LG spending

Justice Inyang Ekwo of the Federal High Court, Abuja, yesterday, dismissed a suit filed by Attorneys-General (AGs) of the 36 states (AGs) and the Nigeria Governors’ Forum (NGF) opposing the Nigerian Financial Intelligence Unit’s (NFIU) guidelines on local government spending.
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Court dismisses governors’ suit against NFIU on regulation of LG spending
Justice Inyang Ekwo of the Federal High Court, Abuja, yesterday, dismissed a suit filed by Attorneys-General (AGs) of the 36 states (AGs) and the Nigeria Governors’ Forum (NGF) opposing the Nigerian Financial Intelligence Unit’s (NFIU) guidelines on local government spending.

The judge, while striking out the case for lack of merit, held that upon studying the NFIU’s rules, he could not find where they conflict with the provisions of Sections 7 (1), (6) (a) and (b) of the 199 Constitution (as amended).

He noted: “I am also unable to see how the provisions of the second defendant (NFIU’s) guidelines contradict or conflict with the provisions of Section 162 (6) of the Constitution which creates the ‘State Joint Local Government Account’ into which allocations to the local government councils of the state from the Federation Account and from the government of the state shall be paid.”
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The court held either that the “guidelines did not contradict Section 162 (8) of the Constitution, which prescribed that the amount standing to the credit of the local council of the 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.”

According to Justice Ekwo, the provisions of the second defendant’s guidelines do not contradict or conflict with the provisions of the Fourth Schedule to the 1999 Constitution (as amended), which prescribes the functions of a local government council.

The presiding judge submitted: “The duty of the court is limited to expounding the law and not expanding it.

“On the whole, I see the provisions of the guidelines of the second defendant as seeking to direct the monitoring of accounts, transfers and any other means of payment or transfer of funds of local government councils as provided for in Section 3 (1) (r) of the Act of the NFIU.”

“It only limits cash withdrawal made from any Local Government Account anywhere in the country to amount not exceeding N500,000 per day.
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“Any amount higher than that can be done using other methods of banking transactions.”

He went on: “Unless it can be shown that there is any provision of the 1999 Constitution (as amended) which these provisions of the second defendant’s guidelines have contradicted or conflicted directly and practically, then the issue of unconstitutionality cannot be said to arise.”

Justice Ekwo, consequently, resolved questions 1 to 5 formulated by the plaintiffs in the originating summons in the negative.
REACTING, NFIU described the ruling in favour of financial autonomy for local councils as a welcome development.

A statement signed by its Chief Media Analyst, Ahmed Dikko, quoted the Director and Chief Executive Officer, Modibbo Tukur, as stating that, “funds can now be decided by councils on which could be channelled to improve local security.”

“The judgment is good because the Federal government is always ready to protect both state and local governments by making funds available for their governance responsibility, he added.
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