Osun Vs FG: Supreme Showdown Looms Over Withheld Billions

The long-running dispute over local government autonomy in Osun State has escalated, as the state government has filed a lawsuit against the Federal Government at the Supreme Court. The case challenges the alleged unlawful withholding of statutory allocations meant for Osun’s local government councils for February, March, and April 2025.

Court documents obtained by Tribune reveal that Osun State is seeking an immediate release of the withheld funds and an injunction to prevent the Federal Government from further suspending or seizing such allocations. The May 2025 allocation remains uncertain.

Filed on April 23, 2025, and marked SC/CV/379/2025, the suit was instituted by Senior Advocate of Nigeria (SAN), Musibau Adetunbi, on behalf of the Osun State Attorney General. The Attorney General of the Federation (AGF) is the sole defendant.

In its originating summons, Osun argues that the Federal Government lacks the constitutional power to withhold funds meant for local councils, especially when democratically elected local governments are in place. The state also invokes previous Supreme Court rulings—AG Lagos v. AG Federation (2004) and AG Federation v. AG Abia (2024)—to back its claims.

The suit raises critical constitutional questions, including:

• Whether, under Sections 162 and 7(1) of the 1999 Constitution (as amended), the FG can legally withhold funds from a state with elected local councils.

• Whether the FG’s actions undermine democratic governance and threaten local government functionality.

Osun State is asking the Supreme Court to declare the FG’s actions unconstitutional, unlawful, and a violation of its constitutional duties. Additionally, it is seeking:

• An order compelling the immediate release of March 2025 allocations.

• An injunction mandating the continued payment of allocations to Osun’s joint local government account.

• An affirmation that Osun cannot be singled out for non-payment while other states continue to receive their allocations.

In an affidavit of urgency deposed to by the Commissioner for Finance, Ogungbile Adeola Olusola, the state emphasized that the prolonged fund seizure is crippling vital sectors like education and healthcare. He warned that continued withholding would paralyze local governance and worsen the hardship on Osun residents.

“The defendant’s actions have already inflicted hardship. If not urgently restrained, the April allocation may also be lost, deepening the suffering of the people,” the Commissioner said.

Osun is concurrently seeking interim and interlocutory injunctions to forestall further damage pending the court’s decision.