For years, one of the biggest complaints from state governors was that there was simply not enough money to run their states. Many blamed dwindling federal revenues, low oil earnings and the huge cost of fuel subsidy for leaving the Federation Account almost empty every month.
Today, the picture is remarkably different.
Whether one supports President Bola Ahmed Tinubu or not, one fact is difficult to dispute: state governments are receiving significantly more money from the Federation Account Allocation Committee (FAAC) than they received during the administration of former President Muhammadu Buhari.
The question Nigerians should ask is not whether allocations have increased, they clearly have, but what governors are doing with the extra money.
The Numbers Tell the Story
In 2022, the last full year of the Buhari’s administration, the 36 states shared approximately ₦2.76 trillion from FAAC. On average, this amounted to about ₦230 billion every month.
When President Bola Tinubu assumed office in May 2023, economic reforms began to reshape government revenue.
By the end of 2023, total allocations to states had risen to approximately ₦3.53 trillion, representing an increase of about ₦770 billion in just one year.
That translates to an average monthly allocation of roughly ₦294 billion, an increase of nearly 28 percent over what states received during Buhari’s final year.
But the real surge came in 2024.
Overall FAAC distributions reached a record ₦15.26 trillion, pushing monthly allocations to states to well above ₦430 billion on average, with some months considerably higher.
This means that compared to Buhari’s final year, state governments are now receiving nearly double the monthly allocations in many instances.
What Changed?
The increase did not happen by accident.
Three major policy decisions contributed to the rise.
First was the removal of the petrol subsidy. For decades, trillions of naira that could have entered the Federation Account were spent subsidising fuel.
Second was the foreign exchange reform. Since Nigeria earns much of its oil revenue in US dollars, the depreciation of the naira increased the naira value of those earnings.
Third was improved revenue generation from taxes and government agencies.
Combined, these reforms expanded the amount of money available for sharing among the Federal Government, states and local governments.
What Does This Mean for Governors?
Consider a simple example.
A state that received about ₦5 billion monthly under Buhari may now receive between ₦9 billion and ₦12 billion, depending on the month and the state’s revenue-sharing profile.
Oil-producing states have recorded even larger increases because they also benefit from the 13 percent derivation fund.
In practical terms, governors today have far greater financial capacity than they had just a few years ago.
Nigerians Deserve to See the Difference
This raises an important question.
If states are receiving almost twice the money they previously received, why are many citizens still not seeing corresponding improvements in roads, healthcare, schools, water supply, agriculture and job creation?
The increased allocations should be reflected in visible development.
Citizens should be able to point to new hospitals, improved public schools, better roads, stronger security support, functioning water projects
