FG, States, LGAs Share N1.41tn October Revenue – FAAC

The Federal Government, state governments, and Local Government Areas (LGAs) have collectively shared a total of N1.41 trillion as revenue for October 2024, according to the Federation Accounts Allocation Committee (FAAC). This disbursement marks a significant achievement for Nigeria’s public finance system, with the revenue shared among the three tiers of government to support their various functions and development programs.

The October revenue allocation, which includes funds derived from oil and non-oil sources, was approved following a meeting of the FAAC, a body responsible for coordinating the distribution of federal revenues to the states and LGAs. The allocation represents a crucial source of funding for government operations, including infrastructure development, social programs, and service delivery at all levels of government.

In the breakdown of the shared revenue, the Federal Government received N561.76 billion, while the 36 states collectively received N451.97 billion. The Local Government Areas were allocated a total of N307.77 billion. The distribution aims to provide the necessary financial support to the governments at all levels to meet their operational needs and drive development projects in their respective regions.

The increase in the allocation for October is attributed to a combination of higher-than-expected revenue from oil exports and growth in non-oil sectors such as taxes, customs duties, and value-added tax (VAT). The oil sector has seen some stabilization in global prices, while non-oil revenue collections have improved due to better tax compliance and improved customs operations.

In addition to the allocation, the FAAC also highlighted that part of the revenue will be used to settle outstanding debts, including arrears owed to various sectors and service providers. The Federal Government, in particular, has been facing challenges in managing public debt, and a portion of the revenue will go towards servicing these obligations.

The revenue sharing process also comes at a time when Nigeria is grappling with economic challenges such as inflation and unemployment. The government at all levels is under pressure to utilize available funds effectively to address pressing issues like poverty alleviation, healthcare, education, and infrastructure development.

The FAAC distribution has been a crucial mechanism for ensuring that resources are fairly allocated across the country, enabling state governments and LGAs to address local development priorities. However, the reliance on oil revenue has raised concerns about Nigeria’s economic vulnerability to global oil price fluctuations. In recent years, there have been calls for diversification of the economy to reduce dependence on oil exports.

Despite these challenges, the October revenue allocation is seen as a positive step in supporting government operations and initiatives. The disbursements are expected to have a significant impact on the implementation of key national and regional development projects, including roads, schools, hospitals, and other critical infrastructure.

As the Nigerian economy continues to evolve, there is a growing emphasis on improving the transparency and efficiency of the revenue-sharing process, ensuring that allocated funds are utilized effectively for the benefit of citizens. Both the Federal Government and the states are expected to prioritize projects that promote economic growth, social development, and poverty reduction, utilizing the shared funds to improve living conditions across the country.