Legal Implications of State Government’s Control over Internally Generated Revenue of Local Government Councils in Oyo State, Nigeria ()
ABSTRACT
This paper examines the sources of internally generated revenue of Local Government Councils in Oyo State and shows that the State Government had taken over the high yielding ones. It also examines section 7 of the Local Government Law 2001 (as amended) of Oyo State which empowers the State Government to collect internally generated revenue of Local Government Councils and give them ten percent out of it. It establishes that this provision contradicts section 162 (7) of the Constitution that mandates each State to pay Local Government Councils out of its total revenue. It also shows that the provision is inconsistent with section 4 (1) of the Allocation of Revenue (Federation Account, Etc.) Act which provides that in addition to the allocation made from the Federation Account to Local Government Councils, each State must distribute ten percent of its internally generated revenue among the Local Government Councils in the State. Thus, each State Government is expected to pay ten percent of its internally generated revenue to Local Government Councils in the State and not compel them to pay their internally generated revenue into State coffer, giving them ten percent of it in return. This paper argues that section 7 of the Local Government Law 2001 is unconstitutional and has drastically reduced the income received from internally generated revenue of Local Government Councils, thereby placing them in miserable financial conditions which have retarded their developmental efforts. The paper concludes that internally generated revenue is the live wire of Local Government Councils, therefore, the Local Government Law 2001 (as amended) and other similar laws should be challenged in court and declared null and void. It also recommends autonomy for Local Government Councils so that they can absolutely control their revenue and use it judiciously for the development of their localities.
Share and Cite:
Oladele, G. (2020) Legal Implications of State Government’s Control over Internally Generated Revenue of Local Government Councils in Oyo State, Nigeria.
Beijing Law Review,
11, 899-910. doi:
10.4236/blr.2020.114054.