Reforms Push FAAC Allocations Above N2trn Monthly — Oyedele
Nigeria’s economic reforms have driven monthly allocations from the Federation Account to state and local governments above N2 trillion, up from an average of about N300 billion recorded under previous administrations, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said.
According to NAN Oyedele disclosed this on Monday in Owerri, Imo State, while declaring open the 2026 National Council on Finance and Economic Development retreat.
According to the minister, the increase in revenue was largely driven by key economic reforms introduced by the administration of President Bola Tinubu, including the removal of petrol subsidy and the unification of the foreign exchange market.
He said the reforms contributed to a record N2.8 trillion allocation from the Federation Account in June 2026.
Oyedele noted that the increased revenue had also eased the pressure on states to meet their salary obligations, saying many states had struggled to pay workers in previous decades.
“For nearly 30 years, it was common for many states to struggle to pay salaries,” he said. “No state currently struggles with salary obligations under the new arrangement.”
The minister, however, cautioned that increased allocations alone could not guarantee economic prosperity, urging state governments to channel available resources into productive sectors, infrastructure, human capital development and essential public services.
He encouraged states and local governments to strengthen their internally generated revenue and reduce dependence on monthly allocations, particularly in the face of uncertainties in the global economy.
Oyedele also called on states to position themselves as economic hubs capable of attracting investments, supporting businesses and generating employment opportunities.
He advocated an urgent review of Nigeria’s revenue-sharing formula to promote greater fairness among the 774 local government areas, alongside stronger measures to ensure fiscal responsibility and sustainable debt management.
The minister further disclosed that the Federal Government had expanded social intervention programmes, including cash transfers targeting 15 million vulnerable households and the NG-CARES programme, to mitigate the effects of the economic reforms on vulnerable Nigerians.
States Must Build Revenue Capacity — Uzodimma
In his remarks, Imo State Governor Hope Uzodimma commended President Tinubu for what he described as visionary leadership and fiscal reforms aimed at repositioning Nigeria’s economy.
The governor, represented at the event by his deputy, Chinyere Ekomaru, said states and local governments were under growing pressure to provide public services despite challenges in mobilising sufficient revenue.
Uzodimma stressed the need to strengthen fiscal federalism by giving states greater capacity to generate revenue and develop their economies.
He called for a fair distribution of revenue allocations while urging states to diversify their economies and manage available resources prudently.
The governor said empowering sub-national governments to build sustainable revenue bases would be critical to improving service delivery and strengthening economic resilience across the country.
