States Share N47tn After Subsidy Removal
By God’sbest Christ’sfullness
Nigeria’s 36 states received a major increase in Federation Account allocations after the removal of the petrol subsidy, with governments sharing about N47.25tn between 2023 and 2025.
The figure represents more than half of the N93.13tn distributed to the Federal Government, states and local governments through the Federation Account between 2017 and 2025, according to data from the Federal Ministry of Finance.
The sharp rise in revenue has increased the financial resources available to state governments, but it has also raised questions about whether the additional funds have translated into better living conditions and public services for Nigerians.
The data showed that total net Federation Account allocations rose from N5.64tn in 2017 to N21.90tn in 2025, an increase of about 288 per cent.
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Allocations stood at N7.98tn in 2018 before falling to N7.85tn in 2019 and N7.11tn in 2020. The figure recovered to N8.12tn in 2021 and N9.18tn in 2022.
Following the economic reforms introduced in 2023, allocations increased to N10.09tn in 2023, N15.26tn in 2024 and a record N21.90tn in 2025.
The increase has been linked to the removal of the petrol subsidy, changes to the foreign exchange system and efforts to improve revenue collection.
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States received about N21.71tn between 2022 and 2025, while the Federal Government received about N17.34tn and local governments received about N13.01tn during the same period.
The states’ allocation increased from N4.18tn in 2023 to N6.53tn in 2024 and N8.93tn in 2025, making them the largest beneficiaries of the increase in FAAC revenue during the period.
The Federal Ministry of Finance said the higher allocations had increased the resources available to states and local governments for salaries, pensions, infrastructure and other responsibilities.
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It also stated that states received about N9.17tn in additional allocations between June 2023 and December 2025 compared with the monthly revenue level recorded before the petrol subsidy was removed.
However, analysts and civil society groups have questioned the extent to which the increased revenue has improved the lives of citizens.
Policy analyst Adebayo Abubakar said some governments had focused on highly visible projects while basic services such as healthcare, education, water supply and other infrastructure continued to receive inadequate attention.
Development economist Aliyu Ilias said citizens and civil society organisations should monitor how states spend the additional funds and demand greater transparency from governments.
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The Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, also called for stronger public scrutiny of state spending, saying governments should prioritise projects that improve productivity and living conditions.
He said higher revenues should be directed towards areas such as roads, water supply and other infrastructure, particularly in rural communities.
The figures also showed that the increase in FAAC revenue should not be measured only in naira terms. While the allocation rose sharply between 2018 and 2025, the weaker naira reduced the dollar value of the funds distributed.
With states receiving significantly more revenue since the 2023 reforms, analysts said the focus should now shift towards how effectively the funds are used and whether Nigerians can see clear improvements in public services and living conditions.
