The Nigeria Extractive Industries Transparency Initiative (NEITI) has reported an unprecedented disbursement of N15.26 trillion by the Federation Accounts Allocation Committee (FAAC) to the federal, state, and local governments in 2024. This marks a historic high and a 43% increase compared to previous years, driven largely by the removal of fuel subsidies and adjustments to foreign exchange rates.
According to the NEITI FAAC Quarterly Review released in Abuja, these fiscal reforms significantly boosted oil revenue remittances, resulting in increased allocations. Executive Secretary of NEITI, Dr. Orji Ogbonnaya Orji, emphasized that the revenue surge reflects major shifts in Nigeria’s fiscal landscape, underscoring the need to assess the sustainability of government borrowing and the implications of resource dependence.
The Federal Government received N4.95 trillion, marking a 24% rise from N3.99 trillion in 2023. State governments received N5.81 trillion, up by 62% from N3.58 trillion, while local governments got N3.77 trillion, a 47% increase from the previous year. Overall, FAAC disbursements rose by 66.2% compared to N9.18 trillion in 2022 and N10.9 trillion in 2023, with the most significant growth occurring between 2023 and 2024.
Lagos State received the highest allocation of N531.1 billion, followed by Delta (N450.4 billion) and Rivers (N349.9 billion). On the lower end, Nasarawa received N108.3 billion, Ebonyi N110 billion, and Ekiti N111.9 billion. Six statees; Lagos, Rivers, Bayelsa, Akwa Ibom, Delta, and Kano—each received over N200 billion, collectively accounting for 33% of total state allocations. In contrast, the six lowest-receiving states—Yobe, Gombe, Kwara, Ekiti, Ebonyi, and Nasarawa—accounted for just 11.5% of the total.
The report also highlighted significant deductions for states’ foreign debts and contractual obligations, totaling N800 billion 12.3% of total allocations to the 36 states. Lagos had the highest debt deduction at N164.7 billion, accounting for over 20% of total deductions, followed by Kaduna (N51.2 billion), Rivers (N38.6 billion), and Bauchi (N37.2 billion).
Dr. Orji urged governments to mitigate economic risks associated with these reforms, such as inflation, rising debt servicing costs, and fiscal uncertainties for oil-dependent states. He stressed the importance of sustainable revenue growth, job creation, poverty reduction, and inflation control.
The NEITI FAAC Review called for accountability in managing public resources, particularly revenues from extractive industries. Dr. Orji emphasized the need for sustained reforms to ensure economic stability and long-term growth.
