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FAAC disbursements hit record N15.26 trillion in 2024, surge by 43% – NEITI
The total disbursement of N15.26 trillion was distributed among the three tiers of government.
The Federation Accounts Allocation Committee (FAAC) disbursed a record N15.26 trillion to the federal, state, and local governments in 2024, reflecting a 43 per cent increase from the previous year.
The surge, detailed in the latest Nigeria Extractive Industries Transparency Initiative FAAC Quarterly Review, underscores the impact of key fiscal reforms, including fuel subsidy removal and exchange rate adjustments, which significantly boosted oil revenue remittances.
The report, presented by Ogbonnaya Orji, executive secretary of NEITI, attributed the increased disbursements to these policy changes, which reshaped the country’s revenue landscape.
According to a statement by the Acting Director, Communication and Stakeholders Management, Obiageli Onuorah, on Tuesday, it assessed the fiscal sustainability of government borrowing and the implications for oil-producing states benefiting from the 13 per cent derivation fund.
Breakdown
The total disbursement of N15.26 trillion was distributed among the three tiers of government. The federal government received N4.95 trillion, while state governments collectively received N5.81 trillion. Local government allocations amounted to N3.77 trillion.
State governments recorded the highest percentage increase, with allocations rising 62 per cent from N3.58 trillion in 2023.
Local government allocations increased by 47 per cent, while the federal government’s share rose by 24 per cent, up from N3.99 trillion in the previous year.
The fourth quarter of 2024 saw the highest quarterly disbursement on record, reaching N4.214 trillion, reflecting the impact of sustained revenue growth and fiscal policy reforms.
Key drivers
The record-high FAAC disbursements were attributed to major fiscal reforms implemented by the federal government.
The removal of fuel subsidies in mid-2023 eliminated deductions that previously reduced distributable oil revenue, leading to increased remittances to the federation account.
Exchange rate liberalisation also played a crucial role, as the depreciation of the naira boosted naira-denominated mineral revenues by over 400 per cent.
In addition, higher global crude oil prices and improved domestic production contributed to increased earnings from the petroleum sector.
Despite these gains, the report warned of inflationary pressures, rising debt servicing costs, and fiscal uncertainty for states heavily reliant on oil earnings.
NEITI emphasised the need for proactive measures to stabilise the exchange rate, curb inflation, and strengthen non-oil revenue sources to ensure long-term economic stability.
Debt deductions and fiscal sustainability
Debt servicing deductions from state allocations amounted to N800 billion, representing 12.3 per cent of total state disbursements.
Lagos State recorded the highest debt deductions, with N164.7 billion, accounting for over 20 per cent of total deductions.
Kaduna State followed with N51.2 billion, while Rivers and Bauchi also saw significant deductions of N38.6 billion and N37.2 billion, respectively.
The report raised concerns over the debt-to-revenue ratios of many states, particularly those with high debt burdens but lower revenue allocations.
NEITI urged governments to adopt conservative revenue projections to prevent budget shortfalls and improve fiscal management to ensure debt sustainability.
State-by-State analysis
Lagos State received the highest FAAC allocation in 2024, totalling N531.1 billion, followed by Delta with N450.4 billion and Rivers with N349.9 billion. Akwa Ibom and Bayelsa also ranked among the top recipients, with N329.2 billion and N270.4 billion, respectively.
Nasarawa received the lowest allocation of N108.3 billion, followed by Ebonyi with N110 billion and Ekiti with N111.9 billion. Six states—Lagos, Rivers, Bayelsa, Akwa Ibom, Delta, and Kano—each received over N200 billion, collectively accounting for 33 per cent of total state allocations.
In contrast, the six lowest-receiving states accounted for only 11.5 per cent.
The report highlighted the widening fiscal disparity between states, noting that Lagos, Delta, Rivers, and Akwa Ibom collectively received N1.49 trillion, a sum more than three times the total allocation of the bottom four states—Kwara, Ekiti, Ebonyi, and Nasarawa—at N442.4 billion.
Recommendations
NEITI called for improved fiscal discipline and enhanced transparency in revenue management at all levels of government.
It urged authorities to increase savings in the Excess Crude Account (ECA) to mitigate future revenue shocks and to strengthen non-oil revenue generation to reduce dependence on FAAC allocations.
The report also recommended measures to stabilise the exchange rate, curb inflation, and ensure conservative budgeting for crude oil production and pricing.
It further stressed the need for governments to prioritise job creation, poverty reduction, and economic stability while maintaining fiscal transparency in line with Open Government Partnership (OGP) and Extractive Industries Transparency Initiative (EITI) commitments.
NEITI reiterated the importance of leveraging its findings to hold all levels of government accountable for the prudent management of public funds, particularly revenues generated from the extractive industries.
The Association of Scavengers, Scrap Dealers, and Recyclers, Abuja, has publicly dissociated itself from a Federal High Court suit filed by unregistered scavengers and beggars against the Federal Capital Territory (FCT) Minister, Nyesom Wike.
In a statement issued in Abuja, the association’s chairman, Mallam Muntari Mohammed, clarified that the group is a duly registered body, with members holding valid identity cards and engaging in legitimate waste management, scrap trading, and recycling businesses.
He stressed that the association has always complied with the FCT Administration’s rules and regulations, maintaining a clean record.
Muntari noted that the association had formally written to the Department of State Services (DSS) and other relevant agencies to affirm its commitment to safeguarding critical infrastructure and adhering to stipulated guidelines.
He distanced the group from unregistered scavengers, whom he accused of tarnishing the reputation of legitimate operators through theft and other illicit activities.
The chairman addressed the FCT Minister’s recent ban on scavenging, which stemmed from misunderstandings about the distinction between honest scavengers and rogue elements.
“We have never confronted the FCT authorities and will never do so,” Muntari said, emphatically dissociating the association from the court case against Wike.
The Vatican has confirmed that only one round of voting will take place this Wednesday afternoon as the conclave to elect the next pope officially gets underway.
Cardinals from around the world gathered earlier Wednesday in the Sistine Chapel, where they took a sacred oath of secrecy before the chapel doors were ceremonially closed with the Latin phrase “extra omnes,” meaning “everyone out.” The papal master of ceremonies then declared the start of the conclave, invoking a centuries-old tradition whose name comes from the Latin cum clave, meaning “locked with key.”
Wednesday’s solitary ballot marked the opening step in the process to choose the new leader of the world’s 1.3 billion Catholics. Should the vote prove inconclusive requiring a two-thirds majority to elect a new pope, cardinals will resume the process on Thursday, casting up to four ballots daily until consensus is reached.
Each cardinal votes by writing “Eligo in Summum Pontificem” (“I elect as Supreme Pontiff”) on a paper ballot, followed by the name of their chosen candidate. In a quiet and orderly procession, they approach the silver and gilded urn in order of seniority to place their ballots.
As the final vote is cast, the tension rises in St. Peter’s Square, where the faithful and millions watching around the globe await the first sign of smoke from the Sistine Chapel’s chimney. Black smoke will indicate that no decision has been made; white smoke will proclaim that a new pope has been elected.
The last two conclaves, in 2005 and 2013, ended on the second day, with Pope Benedict XVI and Pope Francis elected after a series of swift ballots, respectively.
As the doors remain closed and Vatican cameras withdraw, the world waits in hushed anticipation for the next chapter in the history of the Catholic Church to be written.
Governor Hyacinth Alia will not honour the House of Representatives Committee invitation scheduled for Thursday, May 8.
The governor’s Chief Press Secretary, Mr Tersoo Kula, confirmed this to journalists on Wednesday in Makurdi.
The House had summoned the governors of Benue and Zamfara, alongside their Assembly leadership.
Kula stated that the invitation is unconstitutional and the governor will not comply with it.
He explained that Alia has filed a case at the Supreme Court challenging the lawmakers’ invitation.
“Yesterday, the Benue Assembly passed a resolution rejecting the Reps Committee invitation.
“They believe the invitation is based on ignorance and have decided not to attend. They will also challenge it in court,” he said.
Kula added that the governor, independently, has approached the Supreme Court to challenge the invitation’s legality.
He said: “Since the matter is in court, I will not speak further on it.”
Kula also claimed that the civil society group behind the petition is faceless and unregistered.
According to him, the address on the group’s letterhead is fake and lacks credibility.
He said there is a coordinated campaign of misinformation and sponsored protests aimed at destabilising Benue.
In recent weeks, he noted, there have been protests in Abuja allegedly representing Benue people’s concerns.
“These protests aim to provoke a state of emergency in Benue by portraying it in a negative light,” he said.
He claimed the organisers seek to undermine progress and return to a failed political order.
“Their ultimate goal is to create chaos for selfish political gain,” Kula added.
He accused the protest sponsors of trying to remove the governor through disruptive means.
“They will not succeed. Benue people stand firmly with their governor,” he said.
He assured the public that Benue remains peaceful and the government is functioning effectively.
“Governor Alia is committed to fulfilling his mandate and addressing the state’s challenges,” he said. (NAN)