The week ahead – Fragile Gains

Mudashiru Obasa, the ousted Speaker of the Lagos State House of Assembly, briefly took over the office of the current Speaker, Mojisola Meranda, sparking widespread confusion. Obasa’s security details were restored. However, Meranda’s were withdrawn, only to be restored later. Obasa claims he’s still the Speaker despite being removed on 13 January by a two-thirds majority of lawmakers over allegations of financial misappropriation. The lawmakers reaffirmed their support for Meranda. However, in the latest developments, Mojisola Meranda resigned from her position and Obasa was reinstated as Speaker. Obasa was nominated by lawmaker Noheem Adams and expressed gratitude to the All Progressives Congress leaders, lawmakers, and Meranda for their support.

The unfolding drama at the Lagos State House of Assembly, which saw the brief ouster and subsequent reinstatement of Mudashiru Obasa as Speaker, is not just a power struggle; it is a glaring testament to the erosion of legislative independence in Nigeria’s democracy and a precursor to the bitter infighting that the APC in Lagos is likely to devolve to once Bola Tinubu is no longer on the scene. While much has been made about the influence of the shadowy Governor Advisory Council (GAC) consisting of senior APC leaders constituted by Tinubu, it is clear that the body has lost whatever power it had before Tinubu gained federal executive power as president. The sequence of events—Obasa’s forced removal by a two-thirds majority, his defiant claim to the speakership, the withdrawal and restoration of security details, and Mojisola Meranda’s resignation—exposes the extent of political manipulation within Lagos politics. At the heart of this chaos lies the overwhelming influence of the ruling party – All Progressives Congress (APC), and, by extension, President Bola Ahmed Tinubu’s political machinery. The Lagos State House of Assembly has long been under the grip of party loyalists, leaving little room for genuine legislative independence. The chatter that Tinubu backed Obasa’s return is hardly surprising. If true, it reinforces the idea that Lagos, rather than being governed through democratic consensus, is effectively run by an entrenched political hierarchy that prioritises loyalty over constitutional processes. Reinstating a Speaker whose colleagues had overwhelmingly rejected portrays that the lawmakers’ views are secondary to the dictates of the party establishment. The fact that security forces were involved in this debacle suggests that the Lagos Assembly is politically weak and physically vulnerable to external interference. This also exposes the ideological bankruptcy of Nigeria’s political parties. In any functional democracy, removing a Speaker based on allegations of financial misappropriation and highhandedness would signal accountability. Instead, in Lagos, party leaders have forced an unwanted Speaker on lawmakers, dismissing governance concerns in favour of political expediency. The consequences of this fiasco extend beyond the Assembly chambers. First, Obasa’s return will likely be marred by a legitimacy crisis. Lawmakers who voted him out will struggle to recognise his authority, potentially leading to legislative gridlock. Instead of being a forum for governance, the Assembly may become a battleground of factional politicking, stalling crucial legislative duties. Another implication is that democracy in Lagos has been fundamentally weakened. If lawmakers cannot determine their own leadership without interference, governance has taken a backseat to political survival. With 2027 on the horizon, legislative focus will shift away from policymaking to securing political alignments, meaning governance in Lagos will be on autopilot for the foreseeable future. This crisis underscores a broader Nigerian problem—the absence of independent democratic institutions. Beyond the political and institutional failings in the Lagos State House of Assembly crisis, there is a crucial gender dimension that cannot be ignored. As the first female Speaker in Lagos Assembly history, Mojisola Meranda’s swift ousting raises a critical question: Would the power struggle have played out the same way if a man had replaced Obasa? The answer is worth serious consideration. It underscores how women in leadership positions are often treated as placeholders rather than legitimate power holders. If democracy in Lagos is threatened, gender inclusion in its politics is also on life support. Ultimately, what has played out in Lagos is not just a battle for power but a warning sign of the deep flaws in Nigeria’s democratic experiment. If constitutional provisions can be disregarded at will and the will of lawmakers is trampled upon, then the question must be asked: Is there any democracy left to defend?

The Federation Accounts Allocation Committee (FAAC) cannot implement the Supreme Court’s ruling on direct allocation to local governments as most have not provided bank accounts. Only Delta State’s 25 local governments have met the requirements. The Supreme Court ruled on 11 July 2024 that local governments should receive allocations directly to ensure autonomy. However, many have not opened accounts with the Central Bank or designated payment preferences. As a result, FAAC continues paying state and local government shares into joint accounts, disbursing ₦1.703 trillion for January 2025. There are suggestions that some local government chairmen fear state governors’ backlash for seeking direct funding.

Nigeria’s ongoing struggle for local government autonomy reflects deep-rooted structural and political challenges within the country’s federal system. Despite the Supreme Court’s landmark ruling on 11 July 2024, affirming local governments as an independent tier entitled to direct funding, implementation remains stalled. Only Delta State’s 25 local governments have complied with the directive to open designated accounts. As a result, the Federation Accounts Allocation Committee (FAAC) has continued the long-standing practice of paying state and local government allocations into joint state accounts—further entrenching governors’ financial control over local administrations. At the core of this impasse is the reluctance of local government chairmen to assert their independence, largely due to political pressure. Historically, state governors have used joint accounts to dictate local spending, making financial autonomy more of a theoretical ideal than a practical reality. Many local government officials are wary of political repercussions. Hence, they have refrained from opening accounts with the Central Bank of Nigeria (CBN) or designating federal pay offices for direct disbursement. Given the high turnover of local government leadership—often handpicked by state governments—their inaction appears to be a calculated effort to avoid political alienation or outright removal. This situation raises serious concerns about Nigeria’s decentralisation efforts. Local governments, meant to be the closest tier of governance to the people, remain financially handicapped, limiting their ability to deliver essential services and fueling public distrust. Without direct funding, they remain weak institutions, unable to implement independent policies or drive meaningful development. The issue of local government independence is further complicated by broader governance and economic realities. Many states in Nigeria struggle with financial viability, yet political elites continue to push for the creation of more states. Yet, the public often feels little to no impact from local governments, with many Nigerians unclear about their roles and responsibilities. The lack of financial autonomy has been a key argument for their inefficacy, compounded by cases of state governors unilaterally dissolving local councils or refusing to conduct elections. While the Supreme Court ruling provides a legal foundation for reform, local governments still operate under the heavy influence of state governors. The road to autonomy will likely be slow and gradual, and while some progress may be made, significant improvements in local government performance remain uncertain. For real change to occur, the federal government and civil society must push for full enforcement of the ruling, ensuring local governments receive and manage their allocations independently, free from political interference. Without this, the promise of fiscal federalism will remain elusive, and governance at the grassroots will continue to suffer.

Nigeria Customs Comptroller General Bashir Adeniyi warns that the proposed Tax Reform Bills could dismantle the agency, citing conflicts with the Nigeria Customs Service Act 2023. He urged lawmakers to prioritise collaboration over abolition. Meanwhile, President Bola Tinubu has signed the ₦54.99 trillion 2025 Appropriation Bill into law, nearly doubling the 2024 budget. The National Assembly increased the initial ₦49.7 trillion proposal before approving it on 13 February. The budget includes ₦3.65 trillion in statutory transfers, ₦13.64 trillion in recurrent expenditure, ₦23.96 trillion in capital expenditure, and ₦14.32 trillion for debt servicing, with a deficit-to-GDP ratio of 1.52%.

We disagree with CG Adeniyi’s submission. The new bill does not dismantle the Nigeria Customs Service (NCS). Rather, it removes its revenue collection function and transfers it to a new agency—an approach we have long advocated for. This reform will allow the NCS to focus on its core responsibilities: facilitating smooth trade and ensuring border security. Unfortunately for the CG, but perhaps fortunately for Nigerians, tax reforms are a key pillar of President Tinubu’s agenda, and we are confident he will take all necessary steps to ensure their passage. The proposed Tax Reform Bills do not seek to legislate the NCS out of existence. Instead, they will streamline its role by shifting tax and duty collection to the newly created Nigeria Revenue Service, allowing the Customs Service to concentrate on enforcement. Currently, the NCS functions similarly to the UK’s His Majesty’s Revenue and Customs (HMRC), which combines tax, payments, and customs duties. However, Nigeria already has the Federal Inland Revenue Service (FIRS) handling tax collection, creating a duplication of roles. Under the proposed reforms, the NCS will take on a role comparable to the United States Customs and Border Protection, focusing on trade facilitation and border security, while the Nigeria Revenue Service handles all tax and duty collection.

Ghana’s Cedi has depreciated over 19% annually from 2022 to 2024, compared to the 9.4% average from 2001 to 2021. Despite a slight improvement in 2024 with a 19.2% depreciation rate, concerns over macroeconomic stability persist. Such high depreciation rates were historically rare, but the current three-year trend highlights economic instability. However, early 2024 shows promise, with the Cedi depreciating by less than 1% against the dollar. In response, Ghana has introduced a National Economic Dialogue plan focusing on fiscal-monetary policy coordination, tax reforms, infrastructure, and governance. President John Dramani Mahama will submit a report for implementation.

Ghana’s economy is highly susceptible to exchange rate crises, as its local currency, the cedi, consistently struggles against major trading currencies such as the US dollar and the euro. The West African nation has been working to recover from one of its deepest economic crises, which began after the pandemic. Although Ghana entered a three-year IMF bailout program in 2023, the recovery has been slow and uneven due to the cedi’s instability. The country remains heavily import-dependent, with its import bill exceeding $10 billion over the past three years, compounded by high inflation and dwindling international reserves. Although reserves appreciated significantly in the past year, import cover remains below four months. During the two-day National Economic Dialogue, macroeconomic stability was a key focus, emphasising strategies to prevent the cedi from further depreciation against the dollar. The current government, led by President John Dramani Mahama, is pinning its hopes on establishing a Gold Board to regulate small-scale gold mining and purchases. The primary goal is to build strong forex buffers by increasing control over gold exports and enhancing foreign exchange retention. The idea is to bolster reserves and stabilise the cedi. However, many experts familiar with the Cocoa Board—on which the Gold Board’s framework is based—have raised concerns that the initiative could fail. They warn that mismanagement could lead to reckless borrowing, with expected inflows used as collateral for external loans, potentially pushing the country further into economic distress.