Ogun govt. clears air on LG funding, says ‘N1.8b invested in executing projects in Councils’

The Ogun State Government, on Friday, gave further insights into local government administration and funding, demonstrating its commitment to the development of the third tier of government.

At a press conference addressed by the Secretary to the State Government (SSG), Mr Tokunbo Talabi, and Economic Adviser and Commissioner-designate, Mr. Dapo Okubadejo, held at the Olusegun Osoba Press Centre, Governor’s Office, Oke-Mosan, Abeokuta, the government said the process of funding local governments in the state is transparent, open and in line with constitutional provision through the Joint Account Allocation Committee (JAAC).

The government noted that it has been augmenting allocations meant for local governments in the state from the federation account due to shortfalls occasioned by COVID-19 and the economic downturn in the country.

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According to Mr. Talabi, at no time was there any disagreement between the chairmen of the local governments and the state government.

He denied any diversion of statutory allocations and zero allocation, insisting that the present administration has been transparent, accountable, just and equitable in spreading developmental projects to all parts of the State with inputs from local government chairmen in the last few years.

The SSG said the government routinely sends money to the councils to execute some projects to better the lots of the people at the grassroots.

“Up to date, the state government has provided over N1.8 billion for all these local governments to do independent projects, in addition to whatever the state government has done, in addition to whatever the federal government has done and in addition to funding the deficit.

“The concept of zero allocation has not taken place. Otherwise, how have we been paying the teachers? How have we been paying the healthcare workers? How have we been paying the traditional council? How have we been paying the pensioners? How have we been paying the local government staff themselves? How is the chairman getting paid all these years? And then, we have what is called the security vote for the chairman.

“Because we are in an environment where people want to see what you have done, His Excellency, from time to time, makes money available to each of these local governments so that they do some community-based projects; projects that are closer to them.

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“At the beginning of this administration, His Excellency asked the local government chairmen and other stakeholders to present three roads that are more important to them in the order of priority. That is why this administration can boast today that it has executed projects in all local governments. And these were not done without the consent and inputs of the local government operatives,” he said.

Giving more insight into the workings of the Joint Account Allocation Committee (JAAC), the Economic Adviser, and Commissioner-designate, Mr. Dapo Okubadejo noted that JAAC is a statutory and legal instrument that operates in other states.

Speaking on the process of fund allocation, Mr Okubadejo said: “The process of local government account, financing or funding started many years ago, with the introduction of what we refer to as the Joint Account Allocation Committee. That’s the body that is responsible for the administration and the management of the local government direct allocation from the federal government.

“When His Excellency took over the administration in 2019, and because of his pledge to be accountable and also be transparent, the Joint Account Allocation meeting started not long after that. That meeting is the one that is held every month. It is this administration that commenced, after a long time, the organization of the Joint Account Allocation meeting every month on the allocation of funds from the federal government to the local government and also the distribution of it.

“And that meeting comprises of representatives of local government chairmen and all the regular stakeholders in local government administration. So, you have local government chairmen, the association of pensioners, members of the traditional council and all other members that are seated every month at the Oba’s Complex to discuss every month, how much comes in for local governments and how that money is distributed.

“Now, the process is that the Joint Account Allocation Committee account is a completely separate account from the state government’s accounting process. It is managed and administered by different sets of staff that are involved in local government administration in the Ministry of Local Government and Chieftaincy Affairs.

“The account and signatories are separate from the State government. The Accountant General and the Director of Treasury are not signatories to the JAAC.

“On a monthly basis, the Local Government Service Commission prepares the vouchers of salaries and allowances of local government staff, SUBEB prepares that of all primary school teachers, Bureau of Local Government Pensioners prepares that of Pensioners, Ministry of Local Government and Chieftaincy Affairs prepares that of traditional council members.

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“All the data prepared by all these bodies are sent to the Ministry of Local Government and Chieftaincy Affairs, where they are reviewed, collated, and validated. These figures are referred to as First Line Charges. The figures are taken to the JAAC meeting, and once the allocation comes from Abuja, with respect to the JAAC, they disclosed the amount at the meeting as money for Ogun State local government funding. They table all the distributions, which are the First Line Charges, and distribute on local government to local government basis.”

Okubadejo gave further clarification on the state government’s intervention to the local governments allocations to the 20 local governments.

In 2020, N43.121 billion was budgeted for First Line Charges, while N34.750 billion was received from the federation account for the 20 local government areas, leaving a deficit of N6.619 billion.

The commissioner-designate also noted that the total allocation released for local governments in 2021 was N38.723 billion, while payment for First Line Charges was N47.845 billion.

In 2022, N48.074 billion was the total allocation for the local governments from the federation account, while N54.182 billion was the actual amount needed to pay First Line Charges.

“As we were getting into 2023, just for this administration alone, we were coming with a deficit that the state government has paid for of almost N17.4 billion,” he said.

 

He acknowledged that in January 2023, N7.6 billion was received as against the N7.221 billion total First Line Charges, leaving a little surplus.

 

In February, it went back to the normal trend, which was lower JAAC allocation and higher First Line Charges of N3.79 billion and N4.3 billion. The same thing in March and April.

In May, he said there was an increase of N6.348 billion to that of First Line Charges of N4.531 billion.

“Now, when you look at the total carried forward as of July just from 2019 to July 2023, you will see that there is a deficit of N13.591 billion.

“The state government covers this deficit because it affects the salaries and pension of local government staff, primary school teachers, health workers, and traditional council members.

“Again, you recall that about two years ago, His Excellency promised that he was going to be paying N500 million every quarter to clear the backlog of gratuities from 2011, which has now been increased to N1 billion for both state and local government staff. And, paying the local government portion of the gratuities is an addition to the state government’s intervention.
“In addition to that, the governor also directed that certain quarterly allocations should be made directly to local governments for them to undertake certain developmental projects.
“When people talk about zero allocation being distributed, they should be enlightened to know that they cannot talk about allocation in isolation of the First Line Charges which is the first thing that must be paid in local government allocation,” he added.
Answering a question on Ecological Fund, the Commissioner-designate, said the fund is periodical as it is credited into the state and local account through JAAC. He stated that the fund has a high level of oversight as it is meant for flood control, afforestation, and clearing of drainages, among others.