In a landmark ruling, the Supreme Court of Nigeria has delivered a final verdict on the legal battle between the Osun State Government and the Federal Government over withheld funds meant for local councils.
Court Delivers Split Judgment
The apex court, in a decision delivered on December 5, 2025, dismissed the suit filed by the Osun state government. The legal action sought to compel the Federal Government to release financial allocations designated for the state's Local Government Councils (LGCs), which had been withheld.
A seven-member panel of justices reached its conclusion through a split judgment of six to one. The majority held that the suit, which was initiated by the Osun State Attorney General, lacked the necessary legal competence to be heard by the Supreme Court. This means the court ruled it did not have the proper jurisdiction to entertain the matter as presented.
Background of the Legal Dispute
The case stemmed from the Federal Government's decision to withhold statutory allocations meant for the local government areas in Osun State. This prompted the state government, under the leadership of its Attorney General, to approach the Supreme Court directly, seeking a judicial order for the release of the funds.
However, the highest court in the land has now determined that the approach was flawed. By declaring the suit incompetent, the court has effectively closed this particular legal avenue for Osun State regarding the dispute over the local government finances.
Implications for Osun State and Local Governance
This verdict has significant implications. Firstly, it represents a major setback for the Osun State government's immediate efforts to access the withheld funds through this specific lawsuit. The state may now have to explore other legal or political channels to resolve the impasse.
Secondly, the ruling touches on the broader, ongoing national debate about financial autonomy for Nigeria's 774 local government councils. Many states have faced similar issues, and this judgment could influence how such disputes are litigated in the future. It underscores the complex financial relationship between the federal, state, and local tiers of government in Nigeria.
The decision leaves the status of the withheld allocations unchanged, potentially affecting service delivery and administration at the grassroots level in Osun State until a new resolution is found.
