Lagos State and oil producing states emerged as the biggest beneficiaries of the latest Federation Account Allocation Committee disbursement as the Federal Government shared over six trillion naira among the three tiers of government. According to official figures released after the meeting in Abuja Lagos received about one hundred and seventy nine billion naira while oil producing states collectively took home about four hundred and twenty four billion naira from derivation funds.
The allocation reflects a significant rise in federally shared revenue driven largely by improved crude oil production levels exchange rate gains and stronger collection of value added tax. Analysts say the latest figures mark one of the highest monthly distributions in recent years and underline the increasing dependence of states on federal transfers to meet salary obligations and capital spending.
For Lagos the funds are expected to support ongoing infrastructure projects including road expansion health care upgrades and urban transport initiatives. State officials say the government remains focused on deploying the funds to priority sectors such as education security and housing to address the pressure of rapid population growth.
Oil producing states including Delta Rivers Akwa Ibom Bayelsa and Cross River received their largest share through the thirteen percent derivation formula which allocates extra revenue to states where natural resources are extracted. Governors from the region have repeatedly argued that the funds are essential to managing environmental challenges oil spill remediation and youth unemployment in host communities.
Despite the large inflow concerns remain over transparency and accountability in how FAAC funds are used at state and local government levels. Civil society groups have called on state governments to publish detailed spending reports to ensure that allocations translate into tangible development for citizens.
At the federal level officials say the improved revenue outlook will help stabilise public finances at a time of rising debt servicing costs and growing social demands. However economists warn that sustainable fiscal health depends not only on higher revenue but also on structural reforms that reduce waste expand the tax base and diversify the economy beyond oil.
