Local Government Finance And Grassroot Development In Nigeria

Project and Seminar material for Public Administration

Project and Seminar material for Public Administration


This study examines the local government finance and service delivery for community development. It adopted a descriptive research design to elicit data. 100 participants were selected using the simple random sampling technique from the staff of Badagry Local Government. Questionnaire was used as the instrument for the study and the collected data were statistically analyzed with the simple percentage. The findings revealed that there is significant relationship between the state financial control and effective financial management at the local government area. This has led to rapid development at the communal level. This prompted a recommendation that the state government should do more in terms of assisting the local government to achieve more rapid development.

Table Of Contents

  • Title page i
  • Certification page ii
  • Dedication iii
  • Acknowledgement iv
  • Abstract v
  • Table of content

Chapter One:


  • I .1 Background to the Study
  • 1.2 Historical Background of Badagry Local Government Area
  • 1.3 Statement or Problem
  • 1.4 Research Questions
  • 1.5 Research Hypotheses
  • 1.6 Objectives of the Study
  • 1.7 Scope of the Study
  • 1.8 Significance of the Study
  • 1.9 Definition of Terms

Chapter Two:

Literature Review

  • 2.1 Introduction
  • 2.1.1 Purpose and function and local government
  • 2.2 1976 Local Government Reform in Nigeria
  • 2.2.1 Mandatory functions of Local Government
  • 2.2.2 Current Functions
  • 2.3 Sources of Local Government Finance
  • 2.3.1 Block Grant
  • 2.3.2 Equalization Grant
  • 2.3.3 Percentage Grant
  • 2.3.4 Unit Grant
  • 2.3.5 Ad -Hoc or Special Grant
  • 2.4 The Revenue Allocation System
  • 2.5 Internal Local Government Revenue Sources
  • 2.6 Conceptualizing Community Development.
  • 2.7 The role of local government in community development
  • 2.7.1 National building role
  • 2.7.2 Social studies administration role
  • 2.7.3 The planning process role
  • 2.7.4 Data collection instrument
  • 2.7.5 Local government areas as growth centres
  • 2.7.6 Agents of economic and social development 34
  • 2.8 Challenges of local government
  • 2.9 Theoretical framework

Chapter Three:

Research Methodology

  • 3.1 Introducing
  • 3.2 Restatement of Research Hypotheses
  • 3.3 Research Design
  • 3.4 Population
  • 3.5 Sample
  • 3.6 Data Collection Instrument
  • 3.7 Administration or Instrument
  • 3.8 Validity and Reliability of the Instrument
  • 3.9 Method of Data Analysis

Chapter Four:

Presentation, Analysis And Interpretation Of Data

  • 4.0 Introduction,
  • 4.1 Presentation and analysis of data
  • 4.2 Test of hypotheses

Chapter Five:

Summary Of Findings, Conclusion And Recommendations

  • 5.1 Introduction
  • 5.2 Conclusion
  • 5.3 Recommendations
  • References
  • Questionnaires

Chapter One


1.1 Background To The Study

Local Government as third tier of government is very important because it is very close to the people. Local Government is the third and most basic level of hierarchy in the three tiers of administration in Nigeria. It can be seen as a catalyst for grass- root, political, economic and social development.

Politically, local government system is expected to bring the government closer to the people though popular participation in governance. Economically, the local government is expected to ensure that the fruits of development are evenly distributed throughout the length and breadth of the country.

The evolution of local government administration in Nigeria began (over 30 years ago. Though in the early years of the independence, local governments were not given the necessary support in the running of local affairs. However after the attainment of independence in 1960, the Federal Government began to have interest in the administration of local affairs.

Local government as the third tier of government has been largely influenced by the purpose which it is expected to serve and the degree of autonomy it should enjoy, one view is that is that local government. is .a political authority set-up by a nation or state as subordinate authority for the purpose of dispersing or decentralizing political powers.

Firstly, it could take the form of decentralization which is handing over some administrative authority or responsibility to lower level within central government ministries and agencies. It entails shifting of the workload from centrally located officials to staff or officers outside of the national or state capital.

Secondly, it could take the form of development, which is the creation or strengthening of the financial capabilities of sub-national units of government. Their activities are substation outside the direct central of the central government.

Under the devolution form, local units of government are autonomous and independent them separate or distinct (Gbogega, 1989).

Meanwhile, the history of local government in Nigeria can be conveniently traced to the “Native administration” system introduced by the colonial government. Before the advent of colonial administration, in 1861, the people of Nigeria had developed and operated one indigenous formal political and administrative; system with different people of the entities later became Nigeria.

1.2 Historically Background Of Badagry Local Government Area

Sometimes in 1885, a Franco British frontier Commission met in Badagry to established boundaries between former Dabomeg, now Republic of Benin and Nigeria but earlier than this time precisely on 7th of July 1863, the Akran of Badagry, (Oba of Badagry) and this his Chiefs and Signed the treaty of cession of the town of Badagry and its territory to great Britain though the Queen’s representatives.

This made Badagry not to be placed under Lagos territory. Badagry was administered first as a district council and later as a divisional council of the colony province under the Western region of Nigeria Local Government Laws of 1953 and 1959. However, the 1976 local government council with Awori-Ajeromi and Egun-Awori, districts under its jurisdictional authority.

Though the extent of the present day Badagry Local Government Area was first to administered between 1980 – 1983. However, the democratization of the local government 1989 in Nigeria later led to the excision of Ajeromi-Ifelodun and Ojo Local Government Area out of the old Badagry Local Government Council. Nonetheless, the town has ever remained the headquarters of Badagry Division which is one of the administrative divisions in Lagos State.

The main occupations of the people of Badagry are mat-weaving and fishing, with other domestic trade. These contribute immensely to the economy of the local government area. Major tribes and language of the area are Egun, Yoruba, and Aworis. The people of Badagry are predominantly mixed religion with Muslims, Christians and Africa Traditional Religion.

The council secretariat is located on Agric Road at Ajara while it presently runs six other area offices for effective administration. The establishment of the local government administration, conduct of business, as well as the administrative and financial guidelines at Badagry local government area are governed by the existing local government administration law (1999) in the state which came into force on 4th October 1999. The Badagry Local government consists of the executive and legislative arms.

The executive arm is made – up of;

  1. Executive Chairman
  2. Vice Chairman
  3. Two Supervisors, namely,
    • · Supervisor for Education
    • · Supervisor for Agric Rural and Social Development
  4. The secretary to the local government

The legislative arm is made up of elected councilors comprising of;

  1. The speaker
  2. The deputy speaker
  3. Majority leader
  4. Minority leader
  5. Other councilors
  6. Council clerk (A career officer)

Structurally, Badagry Local Government Council has eight departments as follows:

  1. Personnel Management
  2. Economically Planning Research and Statistics Department
  3. Finance Department
  4. Budget Department
  5. Legal Unit
  6. Information Department
  7. Audit Waste and Sanitation Unit
  8. Primary Health (are services Department]

The Badagry local government council, like other councils derives its revenue from internal and external sources. Internal sources of revenue to the Badagry local government includes, commercially undertakings, such as mass-transit service scheme, motor park fees, market stall and lock – up shop fees, local licenses and fees, returns on investment and other miscellaneous sources, especially those conferred on the local government by the constitution and laws of the state .

External sources: The Badagry local government area derives its finances externally from,

  1. Federation Account (Federal Allocation)
  2. Value Added Tax (VAT)
  3. Subvention from the state e.g. grants

Administratively, Badagry local government council like others in the state is controlled by the state through the department for local government in terms of personnel matters local government services commission handles it.

1.3 Statement Of Problem

The system of local government in Nigeria is get to develop nor has it contributed positively to community development. The local government areas have been facing enormous difficulties despite a considerable injection of fund into them. Such difficulties have been hindering the effectiveness and efficiently of their activities. Those problems arise from financial problem, delay in the receipt of federal grants etc and it has greatly hampered the local governments in rendering appropriate services and meaningful developmental programmes for the people.

The local government areas also lacked qualified manpower to plan for the development at the local level, this is due to the absence of modern techniques of management.

In view of the above, the state felt that effective control and efficient utilization or resources at the focal government level will bring about ideal financial management, the operation of the join t account. It is against the background of these problems that the study seeks to assess the effect of local government financial control on efficient mobilization of resources.

1.4 Statement Of Research Questions

The following research questions were asked as a guide to the study

  1. Does Local Government seek permission from the state government before sourcing funds for projects?
  2. Does the state government exercise financial control over the local government areas?
  3. Does state financial control help in the enhancement of financial planning at the local government areas?
  4. Does state grant and local government finances have any positive effect on community development?
  5. Does the state government. gives statutory allocation to local government as at when due?

1.5 Statement Of Research Hypotheses

The following hypotheses were formulated as follows:

  1. Hi: There is a significant relationship between state financial control and effective financial management at the local government area.
    H0: There is no significant relationship between state financial control and effective financial management’ at the local government area.
  2. Hi: There is a significant relationship between state financial government budgetary provision and local government performance.
    H0: There is no significant relationship between state government budgetary provision and local government performance
  3. Hi: There is a relationship between state project control over local government performance
    H0: There is no relationship between state project control over local government performance.
  4. Hi: There is relationship between state human resources control and effective manpower development at local government level.
    H0: There is no relationship between state human resource controls an effective manpower development at local government level.

1.6 Objectives Of The Study

The main objective of this research is to find out how local government finances have affected community development in Badagry local government area.

Other specific objectives include:

  1. To determine the extent to which state local government financial management at the local government level.
  2. To determine the pace of development at the local government area under study.
  3. To proffer solutions to the identified problems.

1.7 Scope Of The Study

The research covers the effect of local government finance on community development in Badagry local government.

1.8 Significance Of The Study

The research will educate the officials of the local government on how to improve financial management system and effective revenue generation in order to bring about vast and high paced community development’.

1.9 Definition Of Terms

Fiscal Federalism:

It refers to the existence of relationship between state and local government in terms of financial affairs

Local government:

It can be defined as the government at local level excising power through representative council established by low to exercise specific powers within defined area (Ayo, 1986).


It can be defined as the group of that live together and thinks in commune e.g. religion, race coronet on in order to achieve their aims and objectives.


It can be defined as the social change in human endeavour.

Community Development:

It can be defined as the process through which citizens are enabled to grow competent for the co-operation solution of their community problems.

Higher Level of Government:

Means state government.

Central Government:

This term can be used to refer to the state government, .even though it mostly applies to the federal government.

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