Don’t you see that state governors are collecting more and more money now? The obvious question Nigerians should be asking is: what exactly are they doing with the increased allocations coming from the Federal Government under President Bola Ahmed Tinubu?
At first glance, the figures appear impressive. Federation Account Allocation Committee (FAAC) distributions have risen substantially in naira terms since the beginning of the Tinubu administration. Recent figures show that the three tiers of government shared N3.007 trillion from July 2026 revenue—the highest monthly FAAC distribution recorded under the administration at that point.
The Federal Ministry of Finance also reported that N2.300 trillion was shared among the Federal Government, states and local governments from May 2026 revenue, while N2.036 trillion was distributed from March 2026 revenue.
So yes, the naira figures are considerably higher.
But here is the part many people may not be paying enough attention to: what happens when those naira figures are converted into dollars?
That is where the argument becomes more complicated.
Nigeria has experienced a major depreciation of the naira since 2023. The Central Bank of Nigeria's official exchange-rate data reflects the dramatic movement in the naira-dollar exchange rate over the period. Consequently, an allocation that looks enormous in naira today cannot automatically be described as being proportionately larger in real purchasing power or international currency terms.
This is why Nigerians should not look at FAAC figures only in naira.
For example, total FAAC allocations increased from about N9.18 trillion in 2022 to N10.9 trillion in 2023 and N15.26 trillion in 2024, according to figures reported from NEITI's FAAC reviews. State governments' allocations also increased substantially during the period.
That sounds like a massive increase—and in nominal naira terms, it is.
But the exchange rate matters.
If the naira loses a substantial portion of its value against the dollar, simply comparing N10 trillion with N15 trillion can create the impression that government revenues have increased by the same proportion in real economic value. They have not necessarily done so.
That is the point governors and other public officials should be challenged to explain.
If they repeatedly point to the huge naira amounts coming through FAAC, Nigerians also have the right to ask what those figures represent after adjusting for inflation, exchange-rate depreciation, population growth and the rising cost of government operations.
The Federal Government itself argues that its economic reforms have significantly increased monthly allocations, with Finance Minister Taiwo Oyedele recently saying allocations to states and local governments have risen to more than N2 trillion monthly, compared with much lower levels under previous administrations.
But increased revenue should also mean increased accountability.
Governors cannot celebrate higher FAAC allocations when the figures are convenient and then ignore the exchange-rate reality when citizens ask whether the money represents genuine improvement in purchasing power.
Just convert the figures to dollars. Then compare them properly.
That is when Nigerians can begin to distinguish between more naira on paper and more real value in the economy.
And perhaps that is the uncomfortable conversation governors—and every other level of government—should be having with Nigerians.
Because ultimately, the question is not simply “How much money did government receive?”
The bigger question is:
“How much value did Nigerians actually get from it?”
0 Comments