The Federal Government has asked the Supreme Court to dismiss a suit by the Osun State Government demanding the release of statutory allocations meant for local governments, insisting that states have no legal right to control or spend LG funds under any guise.
In a counter-affidavit sworn to by Taiye Hussain Oloyede, Special Assistant to the President attached to the Federal Ministry of Justice, the FG maintained that only democratically elected local councils can receive allocations directly from the Federation Account, as ruled in a July 2024 Supreme Court judgment.
“No state should collect or receive the monthly allocation due to the local governments or spend the money for the benefit of the local governments,” Oloyede stated.
According to the affidavit, Osun’s case is flawed because the state failed to prove that it was acting on behalf of the 30 local government councils.
“The plaintiff did not state in its affidavit that it had the authority of the local governments of Osun State to institute this suit,” Oloyede added.
“The plaintiff is by this suit seeking to overturn the judgment of the Supreme Court.”
The federal government’s legal team, led by Chief Akin Olujinmi (SAN), also accused the Osun government of deliberately disobeying the apex court’s 2024 judgment.
“It is indeed shocking to find the plaintiff state claiming… that it had collected such allocations from July 2024 to February 2025 in disobedience to the judgment,” the FG argued.
In its suit, Osun seeks a declaration that the FG’s withholding of LG funds is unlawful and a threat to local governance. State Finance Commissioner Ogungbile Adeola Olusola warned in a sworn affidavit that the freeze on funds could paralyze critical sectors like health and education.
“The continuous seizure… would cripple the governance and subsistence of the local government councils and, by extension, the governance of the state itself,” he said.
But the FG insists that only the councils themselves — not the state — have standing to sue if allocations are not received.
“If wrongly deprived of their allocation… the local governments are entitled to sue the Minister of Finance,” it said.
“Osun State has no locus standi.”
The FG is urging the court to compel Osun to return all funds it allegedly collected between July 2024 and February 2025 and direct the Minister of Finance to remit them to the respective councils.
“Nobody has a right to disobey the judgment of the court and still come back… asking for fresh orders,” the FG said.
The legal clash comes amid ongoing tensions between federal and state authorities over constitutional autonomy for Nigeria’s third tier of government.
