States Retain N1.46 Trillion Local Government Funds

Despite a Supreme Court judgment on July 11, 2024, which ordered that local government councils should be allocated funds directly, Nigerian states have retained N1.46 trillion meant for these councils in the first quarter of 2026. The Supreme Court ruled that state governments have no constitutional authority to retain or control funds meant for local governments.

However, nearly two years after the ruling, the implementation of direct payments to the 774 local government areas remains stalled. The Federal Account Allocation Committee reported that local government councils received N537.88 billion in January 2026, an increase from N431.48 billion in January 2025.

The total distributable revenue for the three tiers of government stood at N6.97 trillion in 2026, down from N7.40 trillion in 2025. Analysts argue that without full enforcement of the Supreme Court ruling, local councils will continue to face limitations in accessing funds necessary for grassroots development.