FAAC allocation marks 55.6% jump in Q3 2025 as FG disburses N6trn 

Federation Accounts Allocation Committee (FAAC)

…Solid Minerals added nothing – NEITI

Nigeria has posted its strongest federation account inflows in recent years in Q3 2025 as cash to governments surged, while gains reshaped States’ rankings as policy risks remain.

Data from the Nigerian Extractive Industries Transparency Initiative (NEITI) showed a total FAAC disbursements of N6.0 trillion in Q3 2025. This includes 13% derivation payments.

Musa Sarkin Adar, Executive Secretary of NEITI, welcomed the strong remittance performance and the reduction in States’ debt burden, drew attention to the volatility in oil markets and optimistic budget benchmarks which might pose risks to fiscal sustainability.

According to NEITI, the figure marks a 55.6% year on year jump. Allocations have more than doubled in two years

The data available showed that Federal Government took N2.19 trillion; States received N1.97 trillion and 774 Local Governments got N1.45 trillion. Statutory revenue drove 62% of the pool. VAT contributed 34%. EMTL and non oil excess augmentation added 2% each.

Further breakdown showes that Lagos received  N179.3 billion; about N59.76 billion monthly. Kano got N79.2 billion; Rivers N78.8 billion; Nasarawa N42.5 billion; Ebonyi N42.9 billion and Ekiti got N43.0 billion.

The spread was wide. The gap between Lagos and Nasarawa was N136.8 billion. Lagos alone earned more than double of waht Kano or Rivers got.

NEITI said Nine oil producing States shared N424 billion as 13% derivation. This shifted rankings materially as four States stood out, namely, Akwa Ibom, Bayelsa, Delta and Rivers. Delta led with N180.68 billion in gross allocation for the third quarter.

NEITI stated that States’ deductions for debt service and obligations fell to N225.89 billion; a 6.5% quarter-on- quarter decline. But, average debt service ratio eased to 9.4%.

Top ratios were Ogun at 26.8%. Lagos at 26.5% and Cross River ranked third. About one-thirds of States stayed below 5%, while more than two-thirds were below 10%

“Stronger cash buffers improve sub national liquidity” the statement added, noting that High inflows support wage bills. Capital spending headroom improves.

The statement  stated that Lagos retained scale advantage, consumer demand and infrastructure spend remain supported, oil states gain outsized upside from derivation, fiscal volatility remains high.

Early Q4 signals point to softer oil prices and a weaker exchange rate. Average crude output slipped from 1.64 mbpd in Q3 to 1.59 mbpd in the first month of Q4. Lower FX inflows could trim distributable revenue.

It further noted that Solid minerals added nothing as derivation from mining was negligible. Last payout was August 2024. NEITI however called for tighter fiscal buffers.

“Apply budget benchmarks consistently, use the stabilisation account to smooth payouts, park FX gains into buffers. Commit regular transfers to the Nigeria Sovereign Wealth Fund”, the statement added.

It also called for conservative oil assumptions, faster mining reforms, downstream petroleum reforms, full implementation of the PIA all aimed at steadier revenues and lower shock exposure.

The Report concludes that Q3 delivered a rare windfall. Lagos topped beneficiaries by a wide margin. Oil States gained most after derivation as oil debt pressure eased, sustaining gains would depend on discipline as oil risks rise in Q4.

Ruth Tene, Assistant Editor, Agric/Solid Minerals/INEC

Ruth Tene is an award-winning journalist with over 15 years experience in developmental reporting across several newsrooms, as a reporter, editor and other managerial roles. She holds a Postgraduate Diploma in Journalism from the University of Maiduguri among several other certifications

She has attended several trainings and certifications both locally and internationally and has been recognized for her impactful work in humanitarian reporting, receiving the Gold Award for Humanitarian Services from the Amazing Grace Foundation. She is also a recipient of the Home Alliance Fellowship, reflecting her commitment to fostering a more humane, safer and more sustainable planet.

An active member of professional journalism bodies, Ruth is affiliated with the Nigeria Union of Journalists (NUJ), the National Association of Women Journalists (NAWOJ), and the Agricultural Correspondents Association of Nigeria (ACAN), where she continues to advocate for excellence, ethical reporting, and development-focused journalism.

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