Just In: Court prohibits FG from deducting ₦16 billion from Anambra allocation fund

The funds in question are the local government’s share of the Paris Club refund, which the Anambra State Government received from the federal government on behalf of the LGAs but did not deliver to them.

Delivering his judgement on Wednesday, June 21, Justice Nnamdi Dimgba declared that the recovery approach taken by the federal government, through the Minister of Finance, was unconstitutional.

Justice Dimgba said the federal government exceeded its legal authority by deciding to deduct the funds from the state’s allocations and directly deposit them into the joint accounts of the local government areas.

He concurred that the state government’s failure to transfer the local government’s share of the funds into the State Joint Local Government Account “is clearly a constitutional breach.”

The solution, according to the judge, does not lie in the minister “exercising unconstitutional powers of deducting at source monies due to the states, and in this case Anambra State, from the federation account.”

“Where a state has failed to make this payment, the state clearly has fallen foul of its constitutional obligation,” the judge said. “For a breach of the Constitution cannot be cured by another breach of the Constitution by another party, no matter how well motivated.”

The judge pointed out that none of the relevant provisions grants the Minister of Finance the authority to make deductions from a state’s statutory allocation from the federation account based on the state’s failure to transfer the local government areas’ share into the State Joint Local Government Account, citing Section 162(5) of the Nigerian constitution and the Allocation of Revenue (Federation Account Etc.) Act.

He said the federal government would require a court order to assist the local government areas recover their money.