The Socio-Economic Rights and Accountability Project (SERAP) has intensified pressure on the Central Bank of Nigeria (CBN), demanding that it publicly reveal whether it has started transferring federal allocations directly to the country’s 774 local governments.
In a formal letter addressed to CBN Governor Olayemi Cardoso, SERAP urged the bank to disclose the precise sums, if any, that have been sent directly to each council from the Federation Account. It also asked Cardoso to clarify if special disbursements have been made to local councils in Rivers State and to provide reasons for such transactions.
The demand follows a landmark Supreme Court ruling delivered in July last year. The court unequivocally declared that neither state governors nor any other body has the authority to withhold or manipulate funds meant for local governments. According to the judgment, such allocations must go directly to elected councils.
In its Freedom of Information (FOI) request dated 10 May 2025 and signed by deputy director Kolawole Oluwadare, SERAP reminded Cardoso that the CBN has a binding obligation to uphold the Supreme Court ruling. “The CBN ought to act in the public interest to ensure that the 774 councils in the country directly get their own allocations from the Federation Account, as ordered by the Supreme Court,” the letter reads.
The organization criticized the ongoing diversion of funds by governors, accusing them of financially strangling councils and violating constitutional principles meant to protect the autonomy of all three tiers of government. SERAP argued that by failing to enforce the court order, the CBN risks weakening its credibility. “State governors are starving local governments of funds and putting them in peril, despite the Supreme Court’s binding orders. State governors’ blatant disregard for the Supreme Court’s orders undermines the integrity of the court and poses a direct challenge to the rule of law,” SERAP stated.
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It added that the CBN should act decisively to guarantee that no tier of government is sidelined ahead of the 2027 general elections, a period it fears could see increased financial manipulation. SERAP gave Cardoso a 7 day deadline to comply, warning that legal action would follow if the CBN failed to respond or publish the requested details. “We would be grateful if the recommended measures are taken within 7 days of the receipt and or publication of this letter. If we have not heard from you by then, SERAP shall take all appropriate legal actions to compel you and the CBN to comply with our request in the public interest,” the group said.
The group raised concerns that many state governors and the Federal Capital Territory (FCT) administration have continued to undermine local councils’ ability to function effectively as an independent tier of government, contrary to the 1999 Constitution. SERAP emphasized that local governments are the rightful beneficiaries of the funds from the Federation Account and that withholding these resources only deepens poverty among Nigerians at the grassroots. “The disbursement of the allocations meant for the 774 councils to states would be at the expense of poor Nigerians and continue to undermine the rights and well being of those at the bottom of the economy and exacerbate the growing poverty in the country,” the group wrote.
According to SERAP, following the Supreme Court judgment, councils across the country reportedly opened dedicated accounts with the CBN to directly receive their shares from the Federation Account. Yet there is little transparency over whether the CBN has honored this arrangement. The letter reminded Cardoso that former president Muhammadu Buhari once publicly admitted how state governors misappropriate council funds. Buhari had said, “If the money from the Federation Account to the State is about N100m, N50m will be sent to the chairman but he will sign that he received N100m. The chairman will pocket the balance and share it with whoever he wants to share it with.”
SERAP also highlighted that the Freedom of Information Act applies to the CBN’s records and compels it to disclose the requested information. It pointed out that the Federation Account Allocation Committee (FAAC) shared N1.578 trillion among all tiers of government in March 2025, yet the fate of local councils’ share remains unclear. “The CBN could play an important role in revitalising the 774 councils in the country and improving opportunities for Nigerians who reside in those councils. The CBN should not allow states to act in breach of the Supreme Court judgment and do whatever they like with the public funds meant for local government councils,” SERAP stressed.
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