CHAPTER ONE
INTRODUCTION
Background of the Study
Local government in Nigeria came into existence as a result of indirect rule system, introduced by Colonial master during the colonial era. Since that period local government system has undergone series of reforms processes such as national conferences, workshops and seminar on different parts of the country as regards to local government administration. The purpose of these seminars and conferences was to ensure an effective and dynamic system of local government in Nigeria.
Inspite of series of seminars and conferences on local government in Nigeria, yet there were recurring inefficiency and mismanagement of resources especially on revenue generation and utilization in Nigeria local government areas. As a result of this, we were motivated by the desire to find out the reason why financial inefficiency is still rampant in local government despite the series of measures applied to ensure effective administration in local government system.
Although, the introduction of 1976 local government reform in Nigeria specified the duties of local government, which contributed in, no small measure towards making people feel the presence of strong and vibrant government. Local government as the third tier of government is a process through which social economic activities are carried out in different localities, thereby making it possible for even development. Local government help to provide government at the grassroots level.
The involvement of the local government through out the country is a way of making government meaningful to them thereby making government an instrument for development. But unfortunately, the local government has not been able to achieve most of these obligations as a result of inadequate financial resources, which has been a major problem leading to ineffective administration in some part of local government in Nigeria.
With the introduction of 1976 reform, there was an improvement in local government as a result of grant which they receive from federal and state government but there dependent on the grant as most of their revenue affect the effectiveness of their service. Local government also receive revenue through internal source such as license fees, tax and rate but some times those revenue are not effectively collected and utilized as a result of embezzlement of the fund by staff members of the L.G.A., who are responsible for collecting the revenue and also by those that manage the revenue.
Despite the arrangement made for local government reform in 1976, the issue of revenue generation and utilization continues to be serious problem.In such situation, we decided to conduct a research into revenue generation and utilization of local government system in Nigeria using Udi Local Government of Enugu State as a case study.
We hope that the solution suggested to the problem will ensure effect and efficiency realization of our aim and objective for futures development in Nigeria.
Statement of the Problem The researchers focused on the prevalent problems that led to the problem of revenue and utilization in Nigeria local government. This problem militates against efficiency generation and effective utilization of local government revenue in Udi Local Government.