In less than four years, allocations to the three tiers of government in Nigeria have doubled. However,
the fortunes of the citizenry have arguably nose-dived in what is panning out as more funds, more pains.....TAP TO CONTINUE READING

Clearly, the three tiers of government, especially the states and local governments, have been receiving higher federal allocations since June 2023.

The surge in published monthly allocations from the Federation Account Allocation Committee, FAAC, reflects the impact of recent fiscal and monetary reforms, buoyant oil receipts propelled by the floating of the Naira and stoppage of oil subsidies, among others.

From N9.18 trillion shared among the three tiers of government in 2022, the figure rose to N10.9 trillion in 2023, jumped to N15.26 trillion in 2024, and hit N18.54 trillion between January and October 2025.

In essence, the three tiers of government have shared N44.03 trillion in 34 months, from January 2023 to October 2025.

Indeed, from N3.58 trillion in 2023, states’ allocations jumped to N5.81 trillion in 2024, and continued in 2025, with states receiving N7.54 trillion between January and October. During this period, the Federal Government received N6.414 trillion, while the Local Governments received N4.547 trillion.

A NEITI FAAC Quarterly Review showed that distribution to state governments in 2024 recorded a percentage increase of 62% from N3.58 trillion in 2023, followed by local government councils with a 47% increase, while the Federal Government’s share rose by 24% from N3.99 trillion in 2023 to N4.95 trillion in 2024.

The report highlighted that total FAAC allocations increased by 66.2% from N9.18 trillion in 2022 to N10.9 trillion in 2023 and N15.26 trillion in 2024.

Amplifying the huge receipts, Minister of Budget and Economic Planning, Senator Abubakar Bagudu, recently said allocation to 36 states and 774 local councils increased from N458.81 billion in May 2023 to N991.81 billion in June 2025, an increase of N533bn or 116.17 per cent.

He spoke at a session organised by the Sir Ahmadu Bello Memorial Foundation, SABMF, in Kaduna. Bagudu stressed that the figure excluded Electronic Money Transfer, EMT, levy, FX gains, and augmentations received by states.
More funds, more pains

The spiked revenues came with huge pains. President Bola Tinubu’s stoppage of fuel subsidies and floating of the naira as he was being sworn-in on May 29, 2023 had immediate socio-economic impact. The exchange rate of the naira to dollar at a stage hit N1,900 and fuel price rose from N197 per litre to between N1,000 and N1,200 in various parts of the country. Inflation rate rose steadily from 22.41 per cent and hit 34.80 percent in December 2024.

More than two years later, little or no improvements have been witnessed given the huge funds accruing to the states and local councils.

In 2023, no fewer than 93.8 million Nigerians(43 per cent) were living below the poverty line, and the figure has reportedly jumped to 139 million(61 per cent). The National Bureau of Statistics, NBS, in its November 2022 National Multidimensional Poverty Index, MPI, said 133 million Nigerians or 83 per cent of the population were multidimensionally poor. The National Population Commission, NPC, put Nigeria’s estimated population in 2023 at 216 million.

The NBS is yet to release its data for 2025 but as of October, the World Bank reported that 139 million or 61 per cent of Nigerians were living below the NBS national poverty line of N376.50 per person daily.

The Worldometer, as of 9.35 pm on December 11, 2025, put Nigeria’s population at 239.719 million. That means only 100.719 million Nigerians are currently living on more than N376.50 per person a day.

The annual headline inflation surged to 34.80 per cent in December 2024. In January 2025, the NBS
updated the base year for its Consumer Price Index from 2009 to 2024, which resulted in a recalibration of the inflation rate to 24.48 per cent. Thereafter, the rate has been declining, hitting 18.02 per cent in September 2025, and 16.05 in October 2025
Wet the grass, Tinubu tasks governors

Disturbed by the persistent cries of hardship and suffering from the citizenry, President Tinubu, recently urged state governors to justify the unprecedented fiscal inflow with visible development results.

The President, who spoke at the National Executive Committee, NEC, meeting of the All Progressives Congress, APC, charged the governors elected on the platform of the party to redouble their efforts in delivering development at the grassroots, saying many Nigerians were still dissatisfied with the pace of governance and the benefits of democracy.

His words: “We need to do more. Nigerians are still complaining at the grassroots. You, the governors, have to wet the ground and give more dividends of democracy at the grassroots.

“We must not rest. Our people need to feel the impact of the government more directly.”
FG earns N31.265 trn in 10 months, shares N18.54 trn

The revenue is N3.555 trillion shy of the initially projected 2025 budget revenue of N34.82 trillion.

After accounting for deductions for cost of revenue collection, transfers, interventions and refunds, the distributable revenue amounted to N18.54 trillion or 58.27 per cent of which the states received N7.54 trillion, the Federal Government got N6.414 trillion while the Local Governments received N4.547 trillion.

Broken down further, the Federal Government received 34.59 per cent, states 40.67 per cent, and LGAs 25.74 percent.

A princely N11.17 trillion or 35.73 per cent of the N31.265 trillion went to “transfers, interventions, refunds and savings,” while revenue collection gulped N1.167 trillion(3.73 per cent).
The tables below show how the N31.265 trillion was earned and spent in 10 months.

Gross Revenue in 2025
Month/Amount(Ntrillions)

January—2.641
February—2.732
March—2.411
April—2.848
May—2.942
June—4.232
July—3.836
August—3.635
September—3.054
October – 2.934

Total —N31.265 trillion

Revenue shared in 2025
Month/Amount(Ntrillions)
January—1.703
February—1.678
March—1.578
April—1.681
May—1.659
June—1.818
July—2.001
August—2.225
September –2.103
October – 2.094

Total —N18.54 trillion

Cost of revenue collection
January —N107.786bn
February—N89.092bn
March—N85.376bn
April—N101.05bn
May—N111.908bn
June—N162.786bn
July—N152.681bn
August—N124.838bn
September—N116.149bn
October – 115.278 bn
Total —N1.167 trillion

How allocations doubled in 4 years

2022 – N9.18 trillion
2023 – N10.90 trillion
2024 – N15.26 trillion

Jan-Oct 2025 – N18.54 trillion
Nominal growth in revenue misleading – Muda Yusuf

Speaking on the issue, Muda Yusuf, CEO of the Centre for Promotion of Private Enterprises, CPPE, reportedly said even though nominal growth in revenue was misleading, states could execute more programmes with better deployment of funds.

“States now have more revenue to execute their programmes such as improving infrastructure, paying salaries and pensioners,” he said.

He raised the question of how well the revenues are being deployed to drive meaningful development, averring that states ought to be publishing their accounts for transparency. Many states have been faithful to the publication of their budget implementation reports, though not all.

Yusuf noted that poor management of resources by the states has resulted in little or no impact on the lives of the people, and cautioned against overestimating the growth of the revenues by the states.
“The fact that revenue has grown in nominal terms doesn’t mean they can buy much. The nominal growth can be misleading. It creates an illusion that the states are getting richer, so we must factor this into our expectations,” he added.
Yusuf’s comment captures the view of many economists on the matter.
States more financially buoyant now – Oyebanji

Sharing his thoughts on the increasing allocation to states, Governor Biodun Oyebanji of Ekiti State thanked President Tinubu for freeing more resources to the states especially Ekiti to carry out people-oriented and legacy projects in the last three years of his administration.

Oyebanji, who stated this during the official commissioning of the ultra-modern Ekiti Revenue House, in Ado Ekiti, recently, disclosed that his administration had been commissioning a wide range of projects including roads, electricity, hospitals and water to commemorate his third anniversary in office.

Oyebanji disclosed that his government has not taken any loan to finance the various projects embarked upon by his government in the last three years, said that his administration is committed to sustaining the state’s development goals stressing that IRS plays pivotal role in propelling the state’s economic growth and contributing massively to the well-being of its citizens.

His words: “I can stand here to boast and beat my chest that every project we have done in Ekiti state up to now, we have not taken a loan to do any one of them. And that speaks to the fact that we have a president who is transparent, who allows the resources to be shared the way it should be shared.

“One thing is for you to have the money at the centre, another thing is for the centre to give it to you, but for once, in our history, Mr. President has given to us more than our fair share of the federation allocation.”