At least 30 local government areas in Osun State have been without statutory allocations for more than 16 months, following a face-off over council elections. The Federal Government stopped releasing funds to the councils in March 2025, shortly after the state conducted local government polls in February 2025. This has resulted in about N216 billion earmarked for Osun's 30 LGAs being withheld between March 2025 and June 2026.
A review of official revenue sharing data from the Federation Account Allocation Committee indicates that N131.5 billion was not released between March and December 2025, and another N85.3 billion was withheld between January and June 2026. According to FAAC documents, Osun's councils were to receive various monthly entitlements, including N11.9 billion in March 2025, N11.2 billion in April, and N12.1 billion in June.
The development has fueled legal and political tension between the Federal and Osun State Governments, with the matter eventually reaching the Supreme Court. In its lead judgment, the apex court ruled that the action was unconstitutional, describing it as a "grave breach of the 1999 Constitution." The court ordered that the funds be "directly channeled to local accounts."
However, the Supreme Court faulted the Osun State Government for filing the suit without showing proof that it got the consent of the affected local governments. The court also dismissed contempt claims brought against the Osun State Government by the Attorney-General of the Federation. A dissenting view argued that the Osun Attorney-General had the powers to initiate the case.
The crisis has also triggered other litigations, including an interim injunction by the High Court of Justice of Oyo State, stopping United Bank for Africa from releasing statutory allocations belonging to Osun's 30 LGAs. Residents staged protests at some UBA branches in Osogbo and Ilesa, accusing the bank of complicity in handling the council funds.
Governor Ademola Adeleke has repeatedly lamented that the withheld funds are crucial for salary payments and basic service delivery, including for primary school teachers, nurses, and health workers in 332 primary healthcare centers, council staff, traditional councils, and pensioners. The Osun State Government has accused the APC of being behind the continued seizure of the allocations.
Meanwhile, an aide to Osun State Governor Ademola Adeleke, Shakirulahi Babatunde, has allegedly kidnapped himself with the aim of extorting the state government. The state police command is investigating the incident, and the government has denied any attempt to pressure the police into dropping the matter. The incident has sparked controversy, with the government calling on the public to ignore misinformation.
Key points
- The Federal Government's withholding of N216 billion allocations has crippled grassroots development in Osun State's 30 local government areas.
- The Supreme Court has ruled that the Federal Government's action was unconstitutional, but the Osun State Government has been faulted for filing the suit without local government consent.
- The crisis has triggered other litigations and controversies, including an alleged self-kidnapping by an aide to Governor Ademola Adeleke.
