Despite the improved fiscal performance, concerns have continued to mount over the apparent disconnect between rising government revenues and deteriorating socio-economic conditions across the country
KANo —
Nigeria’s three tiers of government shared a total of N10.45tn from the Federation Account Allocation Committee (FAAC) between January and May 2026, marking a significant 25.85 per cent increase compared to the N8.30tn disbursed during the same period in 2025.
Despite the surge in revenue, the Nigeria Labour Congress and private sector stakeholders have criticised governments at all levels, arguing that the increased allocations have not translated into improved living conditions for citizens, amid worsening poverty, infrastructure decay, and rising insecurity.
The growth in distributable revenue has been attributed to stronger Value Added Tax collections, increased oil-related tax receipts, and intensified efforts by revenue authorities to meet ambitious fiscal targets estimated at about N40tn for the year.
Breakdown of the allocations revealed that the Federal Government received N3.72tn, making it the largest beneficiary during the period.
State governments collectively received N3.56tn, while the 774 local government areas got N2.51tn. Additionally, the 13 oil-producing states shared N673.17bn as derivation revenue.
Further analysis showed that allocations increased steadily over the five months, rising from N1.96tn in January to N2.30tn in May.
However, allocations rebounded in March by 7.50 per cent to N2.04tn, followed by a 10.85 per cent increase in April to N2.26tn. The upward trend continued in May with a further 1.91 per cent rise.
Year-on-year comparisons painted a more robust picture of revenue growth.
January 2026 allocation increased by 15.09 per cent compared to January 2025, while February rose by 12.87 per cent.
March saw a more substantial jump of 28.86 per cent, followed by increases of 34.35 per cent in April and 38.55 per cent in May.
These figures underscore improved revenue mobilisation efforts as the year progressed.
Gross government revenue also followed a similar trajectory. It stood at N2.59tn in January before dropping to N2.23tn in February.
Despite the improved fiscal performance, concerns have continued to mount over the apparent disconnect between rising government revenues and deteriorating socio-economic conditions across the country.
Reacting to the development, the Assistant General Secretary of the Nigeria Labour Congress, Chris Onyeka, said the increase in revenue had not translated into tangible benefits for Nigerian workers and the general population.
“It is not the quantum of revenue available to the government that translates to impact on the welfare of citizens and workers,” Onyeka said.
“It is the willingness of the people who occupy positions of leadership that determines how these uresources impact the lives of the citizenry.”he added
According to him, the persistent deterioration of infrastructure across the country reflects a deeper governance challenge rather than a lack of funds.
“The answer is simply that 99 per cent of those in government will not let it impact positively on the lives of Nigerians. Because if they do, our lives will not be the way they are. Infrastructure all over the nation has deteriorated significantly,” he stated.
He further identified insecurity as the most critical indicator of governance failure, stressing that economic progress cannot be achieved in an environment where citizens do not feel safe.
“You cannot talk about infrastructure development or the welfare of the citizenry if you cannot address insecurity. If I cannot move from point A to point B without fear, then you cannot talk about any other thing. Security is paramount,” he said.
The labour leader warned that insecurity has far-reaching economic implications, particularly for agriculture and rural livelihoods.
He explained that farmers are increasingly unable to access their farmlands, which in turn affects food production and contributes to rising food prices.
“If I cannot go to my farm and come back safely, if I plant and cannot return to harvest, then it has multiplier effects on the welfare of the citizenry. Nigerians are scared. As you are saving money, you are also saving money for ransom payments,” he added.
Onyeka also lamented that workers had not experienced any relief despite increased government spending, citing rising costs of transportation, housing, food, healthcare, and education.
“We do not feel better off. We do not use better roads. We do not pay cheaper transport fares. We do not have better access to health care, education or nutrition. We cannot feed ourselves better. So how do you measure the impact?” he queried, concluding that “Nigeria is not working.”
Similarly, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, acknowledged that while some states had utilised increased revenues to support citizens, many others had failed to prioritise initiatives that directly improve livelihoods.
According to him, a number of state governments have invested in impactful programmes such as mass transit systems, agricultural support schemes, healthcare services, and rural development projects. However, he noted that these efforts remain limited.
“Many states prefer to embark on physical projects people can see, like express roads, flyovers and airports. Those things are not bad, but their developmental impacts in terms of livelihoods and living standards are very limited,” Yusuf said.
He warned against a scenario where improved fiscal performance coexists with deepening poverty and inequality, urging governments to adopt more inclusive policies.
“States should focus on things that directly impact livelihoods and welfare so that we do not have a situation where there is prosperity in terms of revenue while so many people are left behind. Inclusion is very critical,” he said.
Yusuf also emphasised the need for state governments to play a more active role in addressing insecurity, rather than relying solely on the Federal Government. He called for increased support for security agencies and community-based initiatives to enhance safety across the country.
As FAAC allocations continue to rise, analysts say the real challenge lies in ensuring that increased revenues translate into measurable improvements in the lives of Nigerians, particularly in the areas of security, infrastructure, and economic opportunity.
