The Federal Account Allocation Committee’s statutory allocations to the 36 states and 774 local government areas from July to December 2023 have increased to N3.34 trillion following the end of fuel subsidies.
According to data from the National Bureau of Statistics, N545 billion, or 19.5%, more money was paid to states and local governments in the first half of the year (January-June).
In separate interviews with newsmen on Monday, Nigerians, including organised labour groups, challenged state governors to explain greater allocations by alleviating widespread poverty.
In his inauguration speech on May 29, 2023, President Bola Tinubu ended the gasoline subsidy scheme, which he said was eroding government funds.
He vowed to reinvest the funds in social projects and infrastructure.
However, the policy caused hardship for residents, resulting in a more than 100% increase in goods and service costs.
The majority of income shared at FAAC meetings by federal, state, and municipal governments comes from oil exports, taxes, and other statutory allocations.
The current revenue-sharing model allocates 52.68 percent of income to the federal government, 26.72 percent to states, and 20.60 percent to local governments.
The fund is intended to ensure development at all levels of government while also allowing states and LGs to satisfy their responsibilities.
However, the LGs are not independent, and the governors choose how they spend their budgets.
In his inauguration speech on May 29, 2023, President Bola Tinubu ended the gasoline subsidy scheme, which he said was eroding government funds.
cc: Punch Ng
