The Supreme Court has struck out a suit filed by the Osun State Government over alleged withholding of local government allocations, ruling that the state lacked the legal standing to sue on behalf of its 30 local government councils. The apex court held that under the Constitution, it is the local governments themselves – not the state government – that can approach the court to complain about non‑release of their statutory funds.
In the suit, the Osun State Attorney General had asked the Supreme Court to compel the Federal Government to release allocations allegedly withheld and to restrain the Attorney General of the Federation (AGF) and the Minister of Finance from diverting funds to rival local government officials.
The state sought several declaratory and injunctive reliefs, insisting the funds ought to go directly to councils whose February 2025 elections it recognised, rather than to All Progressives Congress (APC) chairmen whose earlier election had been annulled by lower courts.
However, the AGF opposed the action, arguing that Osun had no locus standi and was in contempt of the Supreme Court’s July 11, 2024 judgment which barred state governments from seizing or managing local government allocations. He maintained that the earlier judgment in AGF v. Attorney General of Abia State & Others required that LG funds be paid directly to the councils and not through state governments, accusing Osun of trying to “appoint itself as watchdog” over monies that do not belong to it.
A panel of justices agreed that Osun could not validly sue in its own name over alleged non‑payment of funds due to constitutionally recognised local government councils. The court therefore struck out the suit for want of jurisdiction, stressing that any challenge to the withholding or diversion of LG allocations must be initiated by the affected councils themselves, not by the state government.
The decision came in the course of proceedings in a broader legal battle between Osun and the Federal Government over control and release of LG funds, in which the Supreme Court had earlier reserved judgment on a separate, properly‑constituted suit.
By striking out this particular case, the court reaffirmed its earlier position that state governments cannot intermediate local government finances and cannot litigate over those funds without clear constitutional authority or the councils’ direct mandate.
