- FAAC Disbursement Hits All-Time High of N6 Trillion in Q3 2025
- Oborevwori tasks govs as FAAC shares N9.62tr in three months
- NEITI flags fiscal risks as oil prices soften, urges urgent policy safeguard
Nigeria’s federation account posted a historic surge in the third quarter of 2025, with total allocations hitting N6 trillion, the highest quarterly disbursement on record.
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Eko Hot Blog reports that while the figures reflect stronger revenue sharing across all tiers of government, they also expose looming fiscal risks as crude oil prices soften and production levels decline toward the final quarter of the year.
The figures were disclosed by the Nigerian Extractive Industries Transparency Initiative (NEITI) in its Q3 2025 Quarterly Review released yesterday. According to the report, the disbursement represents a 55.6 per cent increase compared to the same period in 2024 and more than double what was shared two years ago.
Between September and November 2025 alone, a total of N9.62 trillion was distributed through the Federation Accounts Allocation Committee (FAAC). Reacting to the inflow, Delta State Governor, Sheriff Oborevwori, urged governors across the country to improve the welfare of citizens, insisting that states now have access to more financial resources.
The N6 trillion allocation includes 13 per cent derivation payments to oil-producing states, highlighting the continued dominance of oil-related inflows in the federation revenue structure.
A breakdown of the Q3 disbursement shows that the Federal Government received N2.19 trillion, state governments N1.97 trillion, while local governments got N1.45 trillion, reflecting increased statutory transfers across all levels of government.
Governor Oborevwori, speaking at the flag-off ceremony of the N39.3 billion Otovwodo Flyover Project in Ughelli North Local Government Area, dismissed claims that states lack funds. He said it was no longer reasonable to conceal financial realities from Nigerians, noting that more money is now available to subnational governments.
NEITI’s report revealed that statutory revenue accounted for 62 per cent of total shared receipts in Q3, while Value Added Tax (VAT) contributed 34 per cent. The Electronic Money Transfer Levy (EMTL) and non-oil excess revenue augmentation contributed two per cent each.
In addition to statutory revenue, VAT, EMTL and the Ecological Fund, states also benefited from an extra N100 billion augmentation from the non-oil excess revenue account, further boosting their quarterly inflows.
State-by-state analysis showed wide disparities in allocations. Lagos State topped the chart with N179.3 billion for the quarter, translating to an average monthly inflow of N59.76 billion. Kano followed with N79.2 billion, while Rivers State received N78.8 billion.
At the lower end, Nasarawa State got N42.5 billion, Ebonyi N42.9 billion, and Ekiti N43 billion. NEITI noted that Nasarawa’s allocation amounted to an average monthly inflow of N14.1 billion, with a N136.8 billion gap between the highest and lowest state allocations in Q3.
Among oil-producing states, Delta State recorded the highest gross allocation of N180.68 billion, alongside Akwa Ibom, Bayelsa and Rivers, which also benefited significantly from derivation payments.
On debt obligations, NEITI disclosed that N225.89 billion was deducted from states’ allocations for debt servicing and other commitments during the quarter, representing a 6.5 per cent decline from the previous quarter. The average debt service ratio across states stood at 9.4 per cent, ranging from as low as 1.5 per cent to as high as 26.8 per cent.
The report showed that about one-third of states had debt service ratios below five per cent, while over two-thirds remained below 10 per cent, suggesting gradual improvement in subnational debt sustainability.
Despite the record inflows, NEITI warned of emerging fiscal pressure in Q4 2025. The agency cited lower average oil prices, a slightly weaker exchange rate and declining crude oil output as key risk factors.
Average daily crude oil production fell from 1.64 million barrels per day in Q3 to 1.59 million barrels per day in the first month of Q4, a trend NEITI said could weaken foreign exchange earnings and distributable revenues if it persists.
Meanwhile, the National Bureau of Statistics (NBS), in its FAAC Allocation Reports for September to November 2025 released yesterday, disclosed that N3.64 trillion was disbursed in September, N3.05 trillion in October and N2.93 trillion in November.
According to the NBS, the disbursements comprised N2.16 trillion from the Statutory Account, N49.87 billion from EMTL and N719.83 billion from VAT.
The report further showed that N141.39 billion was shared among oil-producing states from the 13 per cent derivation fund, while revenue-generating agencies received N29.64 billion for the Nigeria Customs Service, N50.71 billion for the Federal Inland Revenue Service, and N34.92 billion for the Nigerian Upstream Petroleum Regulatory Commission as cost of revenue collection.
