Market News

February’s allocation stood at N1.678tn, from which the Federal Government received N569.66bn, states received N562.20bn, and LGs got N410.56bn.

The revenue included N827.63bn in statutory revenue, N609.43bn from VAT, N35.17bn from EMTL, N28.22bn from solid minerals, and N178bn augmentation.

In March, FAAC shared N1.578tn. The Federal Government received N528.70bn, states got N530.45bn, and local governments received N387bn.

The distributable revenue comprised N931.33bn in statutory revenue, N593.75bn from VAT, N24.97bn from EMTL, and N28.71bn from exchange difference.

The increase in allocations was driven by higher collections from VAT, statutory revenue and augmentation funds.

Gross revenue from VAT in January 2025 stood at N771.89bn, declining to N654.46bn in February and N637.62bn in March. Meanwhile, statutory revenue rose from N1.848tn in January to N1.653tn in February and N1.718tn in March.

Despite these higher inflows, LGs have yet to receive funds directly into their accounts, contrary to the Supreme Court’s directive delivered in July 2024.

The apex court had ordered that allocations from the Federation Account be paid straight to the LGAs to ensure their financial autonomy and shield them from undue interference by state governments.

However, implementation has stalled.

The Central Bank of Nigeria had said the non-availability of up-to-date audited accounts for many local councils was among reasons for not opening dedicated accounts for them.

As a result, FAAC distributions continued to be routed through state treasuries.

The continued delay has raised concerns about adherence to the rule of law and fiscal transparency at the grassroots level.

While the Supreme Court ruling remains binding, the existing financial structure persists, leaving LGs dependent on the discretion of state governments for accessing funds.

Meanwhile, the Federal Government’s share of the Q1 2025 allocation stood at N1.651tn, while state governments received a total of N1.683tn.

The Excess Crude Account, which once served as a buffer against oil price volatility, remained unchanged at $473,754.57 as of the end of March.

The Association of Local Governments of Nigeria had accused the Office of the Attorney-General of the Federation of frustrating the implementation of local government autonomy, despite the Supreme Court ruling in favour of direct funding for all 774 local councils.

ALGON had also taken legal action against the AGF and several other federal institutions in suit FHC/ABJ/05/353/2025, seeking full inclusion of local governments in the Federation Account Allocation Committee and the right to independently manage their funds.

The suit also names the Minister of Finance, Wale Edun; Minister of Budget and National Planning, Abubakar Bagudu; Accountant-General of the Federation; the CBN; NNPCL; and commercial banks as defendants.

ALGON says its push in court aims not just to enforce autonomy on paper but also to ensure practical implementation.

The case, initially scheduled for mention before Justice Inyang Ekwo, could not proceed as the court did not sit. The matter was rescheduled for May 29, 2025.

Reacting, the ALGON Secretary-General, Mohammed Abubakar, expressed frustration over the continued delay in the direct payment of funds to LGs despite the Supreme Court judgement.

Abubakar said the situation was becoming complicated and that many Nigerians who were once hopeful had become disappointed.

He said, “When the Supreme Court gave its judgment, everybody was happy and our hopes were high. But up till now, the money has not started coming directly to the local governments.”

He suggested that some people might be benefiting from the current system and were working against the implementation of the court’s ruling.