The Federal Ministry of Finance has dismissed recent media reports alleging “hidden spending” and diversion of federation revenue, describing the claims as a misinterpretation of the latest Nigeria Development Update by the World Bank.
In a statement issued by the Minister of State for Finance, Taiwo Oyedele, the ministry said the reports reflect a fundamental misunderstanding of Nigeria’s fiscal framework, particularly regarding deductions by the Federation Account Allocation Committee (FAAC).
The ministry clarified that FAAC deductions, referenced in the World Bank report, are legitimate and comprise 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 that benefit subnational governments.
It stressed that such transfers and refunds do not constitute leakages or waste, but rather represent lawful fiscal obligations and allocations backed by statutory provisions.
Addressing concerns over data interpretation, the ministry accused some commentators of selectively relying on outdated figures while ignoring forward-looking insights and ongoing public financial management reforms highlighted in the report. It noted that reforms introduced in early 2026—including a recent Executive Order aimed at safeguarding petroleum revenue remittances—are already improving transparency and are projected to increase distributable revenues by approximately 0.4 per cent of GDP annually.
The statement further underscored the World Bank’s broader, positive assessment of Nigeria’s economic trajectory. According to the ministry, the report points to increasingly broad-based economic growth, a gradual decline in inflation driven by policy measures, a strengthened external position supported by higher reserves and a current account surplus, and an improvement in debt metrics, including a reduction in the debt-to-GDP ratio for the first time in over a decade.
Contrary to claims of fiscal distress, the ministry said the World Bank recognises that Nigeria’s reforms are yielding results, while emphasising the need for sustained and deepened efforts to translate macroeconomic gains into inclusive growth.
Reaffirming the government’s commitment, the ministry said it will continue to enhance fiscal transparency, improve revenue mobilisation, and ensure efficient public spending. It also called on stakeholders, media organisations, and the public to engage responsibly with fiscal data to avoid misrepresentations that could undermine confidence in ongoing reforms and the country’s economic outlook.
