FG faults allegations of revenue diversion, hidden spending
Omeiza Bilal
The Federal Government has described as misleading and false recent media reports and commentaries concerning the latest Nigeria Development Update by the World Bank, particularly claims suggesting that a significant portion of federation earnings is being “diverted” or constitutes “hidden spending”.
Minister of State for Finance Taiwo Oyedele in a signed statement said these interpretations misrepresent the World Bank’s analysis and reflect a misunderstanding of the fiscal system.
The minister further said the misreporting in question incorrectly characterises Federation Account Allocation Committee (FAAC) deductions as “waste” or missing funds were incorrect.
Such deductions, according to him, include statutory transfers, savings and investments, security-related expenditures, cost-of-collection charges, refunds to Ministries, Departments and Agencies (MDAs), as well as transfers and interventions benefiting sub-national governments.
Oyedele argued that refunds and transfers to states and other tiers of government should not be classified as leakages, noting that they represent lawful fiscal flows, including repayments of obligations and allocations backed by law.
He also faulted what he described as the selective use of outdated data in some commentaries, stressing that the World Bank report acknowledged ongoing reforms aimed at improving transparency and boosting revenue.
The Minister pointed out that reforms introduced in early 2026, including a new Executive Order designed to safeguard the remittance of petroleum revenues, were already addressing concerns around deductions and are projected to increase revenues available to all tiers of government by about 0.4 per cent of Gross Domestic Product annually.
Highlighting the broader outlook of the report, Oyedele said Nigeria’s economic performance was showing signs of improvement, with growth becoming more broad-based across sectors, inflation gradually declining, and the country’s external position strengthening through improved reserves and a current account surplus.
Debt indicators had also improved, including a reduction in the debt-to-GDP ratio for the first time in over a decade, the Minister added.
“These developments reflect the outcomes of the current administration’s ongoing macroeconomic policies and public financial management reforms,” Oyedele said.
The minister insisted that the “World Bank does not conclude that Nigeria’s fiscal system is collapsing or that reforms have failed. Rather, it states that reforms are working, and they must be sustained and deepened to translate macroeconomic gains into inclusive growth.”
He therefore urged stakeholders, media organisations, and the public to engage constructively with fiscal information and avoid twisted interpretations that may undermine reform efforts and fuel public discord.
