Taiwo Oyedele said media reports misrepresented the World Bank’s latest Nigeria Development Update and wrongly portrayed FAAC deductions as hidden spending. In a statement issued in Abuja on Sunday, the Minister of State for Finance said there was no diversion in federation revenue and that the deductions were lawful parts of public finance administration.
He said claims that a significant share of federation earnings was being diverted were inaccurate. Oyedele said the World Bank does not conclude that Nigeria’s fiscal system is collapsing or that reforms have failed. Rather, it affirms that reforms are working and should be sustained to achieve inclusive growth.
Abuja Statement
Oyedele’s statement came after recent commentary around the latest Nigeria Development Update, which he said had been read selectively. He said some reports used outdated data and treated legitimate fiscal flows as if they were leakages. For readers trying to track what changed, the government’s position is that the dispute is not over whether deductions exist, but over how they are described.
The ministry said FAAC deductions include statutory transfers, savings and investments, security-related expenditures, cost-of-collection charges, refunds to MDAs, and transfers and interventions benefiting subnational governments. Oyedele said refunds and transfers to states and other tiers of government should not be classified as leakages, because they represent lawful fiscal flows, including repayments of obligations and allocations backed by law.
FAAC Deductions Explained
The Federal Government dismissed reports claiming there were hidden spending and diversion of federal revenues. Oyedele said the criticism reflected a misunderstanding of Nigeria’s fiscal framework. He said the deductions portrayed as wasteful or missing funds were legitimate and statutory components of public finance administration.
The statement also set out the reform side of the argument. Oyedele said the World Bank report acknowledged ongoing reforms aimed at improving transparency and boosting revenue. He said reforms introduced in early 2026 included a new Executive Order designed to safeguard the remittance of petroleum revenues, and said they were projected to increase revenues available to all tiers of government by about 0.4 per cent of Gross Domestic Product annually.
Reforms in Early 2026
Oyedele also 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. He said debt indicators had improved, including a reduction in the debt-to-GDP ratio for the first time in over a decade.
The government reaffirmed its commitment to fiscal transparency, enhanced revenue mobilisation, and efficient public spending. For readers following the debate, the immediate issue is whether public discussion of FAAC deductions will now separate statutory payments from alleged leakage, after Oyedele rejected the hidden-spending reading and pointed to reforms already in motion. Tinubu directs Wale Edun handover by Thursday also sits alongside the finance ministry’s broader push to keep revenue reporting and remittance rules aligned.
