Local Government Finance in Nigeria: A Case Study of Iwo Local Government Area of Osun State

Abstract

The current financial predicament of Local Government Councils and constant pressure for increase allocation has been in the front burner of Local Governments Administration in Nigeria. The focus of this paper therefore is an examination of Local Government Finance in Nigeria using Iwo Local Government as a Case Study. Data for the study were gathered from face-to-face interview, available records in Iwo Local Government, text books, lecture notes, journals, reports, seminar presentation and internet materials. The data collected were subjected to descriptive statistics (simple percentage) and content analysis. The study explored various sources of financing local governments in Nigeria. It also explained financial relationship of Nigerian local government vis-a-vis State and Federal Government using theory of decentralization. The study went further to explain financial management in Iwo L.G. Result obtained from the analysis shows that financial transfers from federal government (Statutory Federal Allocation) are the most viable and reliable source of local government revenue and that without Federal Allocation no capital project can be embarked on. Therefore, to arrest this financial situation that local government find itself, that is  over dependence on federal allocation, this work submitted that local government should increase their revenue base by laying more emphasis on the internal revenue sources, especially those areas that are hitherto neglected or not been fully exploited. Keywords: Local Government, Administration, Finance, Decentralization, Nigeria, Iwo