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Reps move to stop states with non-elected LG chairmen from accessing capital market funds

By Emman Ovuakporie & Johnbosco Agbakwuru

ABUJA—THE House of Representatives, yesterday, passed into second reading a bill for an act to amend the Fiscal Responsibility Act, 2007, which would make it mandatory for states to have democratically elected local government councils before they can access funds from the capital market.

The amendment bill, sponsored by Edward Gyang Pwajok, SAN, is seeking to make it mandatory for state governments that want to borrow from the capital market to involve not only their House of Assembly but also elected local governments chairmen to consent to such borrowing.

“This will make for more fiscal responsibility as the public will be involved in the process and it will ensure that state governments respect Section 7 of the Constitution which requires that all local governments must be democratically constituted. The amendment bill also provides for punishment for violations of the law. The principal law only provides for offences without providing the punishment,’’ Pwajok said.

The lawmaker explained that the bill was a simple amendment that added provisos to two sections of the principal Acts. He said: “The bill seeks to increase and streamline the requirement of states desirous of borrowing funds from the Capital Markets and this will aid financial transparency and responsibility.”

Pwajok expressed concern that some state governors run the administration of local government areas with different contractions such as caretaker committees, in violation of the provisions of the constitution. According to him, having, therefore, established the autonomy of local government council as an independent level of government, the structure upon which it is to be run must, as of necessity be properly defined.

Pwajok said the government of every state shall be subject to the constitution, to ensure that local government councils existed under a law which provided for the establishment, structure, composition, finance and functions of such councils.

 

 


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