Economy
How FG, States, LGAs Shared N10.14trn from FAAC in 2023—NEITI
By Adedapo Adesanya
The three tiers of government – Federal, State and Local governments – shared the total N10.143 trillion from the Federation Account as statutory revenue allocations in 2023, the Nigeria Extractive Industries Transparency Initiative (NEITI) FAAC review report has shown.
According to the report released on Tuesday, the N10.143 trillion disbursements made in 2023 were 23.6 per cent or N1.934 trillion higher than the N8.209 trillion allocated in 2022.
A breakdown of the revenue receipts showed that the federal government received N3.99 trillion, representing 39.37 per cent of the total allocation. N3.585 trillion representing 35.34 per cent was shared among the 36 states while the 774 local government councils of the federation shared 2.56 trillion equivalent to 25.28 percent in the period.
According to the report, “the first quarter of 2023 increased by N579.71 billion (33.19 per cent) when compared to the first quarter of 2022. The second quarter increased by 10.32 per cent, the third quarter by 27.49 per cent and the fourth quarter had an increase of 23.42 per cent respectively.
“The federal government’s share increased by N574.21 billion (16.79 per cent) from the N3.42 trillion it received in 2022 to N3.99 trillion in 2023. The State governments shared N3.59 trillion in 2023 compared to the N2.76 trillion they got in 2022, showing an increase of 29.99 per cent. Similarly, local government councils’ share of federation allocation was N2.57 trillion in 2023 compared to N2.032 trillion in 2023 which amounts to a 26.22 per cent increase.
“While total distributed revenue from the Federation Account recorded an overall increase of 23.56 per cent in 2023, the increase accruing to each tier of government varied, largely due to the type of revenue item contributing to the inflows into the Federation Account.
“In the same period (2023), states and local governments recorded increases in their allocations of 29.99 per cent and 26.22 per cent, respectively. The increase in allocation to the federal government, however, was 16.79 per cent.”
The report also noted that while total revenues distributed from the Federation Account recorded an overall increase of 23.56 per cent in 2023, the increase accruing to each tier of government varied, largely due to the type of revenue streams contributing to the inflows into the Federation Account.
State-by-state share of the allocations showed that Delta State received the largest share of N402.26 billion (gross). The figure includes the state’s share of oil and gas derivation revenue. Delta was followed by Rivers State which received N398.53 billion while Akwa-Ibom State received the third largest allocation of N293.58 billion.
On the share of derivation revenue, nine states received the 13 per cent allocated to mineral-producing states from the proceeds from mineral revenue.
Commenting on the report, Mr Orji Ogbonnaya Orji, the Executive Secretary of NEITI, attributed the increase to improved revenue remittances to the Federation Account due to the removal of petrol subsidy and the floating of the exchange rate by the new administration.
He explained that the agency embarked on the NEITI FAAC Quarterly Review to enhance public understanding of Federation Account allocations and disbursements as published by the government.
He said, “The ultimate objective of this disclosure is to strengthen knowledge, and awareness and promote public accountability of all institutions in public finance management.
“The government (the National Assembly and the Executive) should adopt more conservative estimates for crude oil prices and output to enhance budgetary performance, reduce budget deficits and borrowing and strengthen fiscal stabilization.”
“NEITI’s FAAC Quarterly Reviews also underlined the need for States to join hands with the federal government to deal with insecurity in rural communities where agro-based businesses thrive, pay attention to internally generated revenues through innovations and leadership that are citizen-centred.”
By Adedapo Adesanya
The National Pension Commission (PenCom) has defended its decision to allow Pension Fund Administrators (PFAs) to invest in the parent companies of their custodians, insisting that adequate safeguards are in place to protect contributors’ funds.
The director-general of the pension regulator, Ms Omolola Oloworaran, speaking on Tuesday during the Meet the Press Briefing at the Presidential Villa, Abuja, said the commission’s decision to relax the investment restriction followed a comprehensive risk assessment that found minimal conflict of interest.
She explained that under PenCom’s investment regulations, PFAs are only permitted to invest pension assets in carefully selected instruments that meet stringent criteria, including profitability, strong credit ratings and proven track records.
According to her, the commission regularly reviews its investment regulations, conducts routine examinations and spot checks on PFAs to ensure strict compliance with established risk management guidelines.
“PFAs cannot just go into the stock market and buy any kind of stock. There are strict guidelines. Companies must demonstrate profitability, have a proven track record and satisfy other criteria before pension funds can invest,” she said.
Ms Oloworaran noted that each PFA also operates under the oversight of a board, an investment committee and a risk management committee, providing additional layers of governance to safeguard contributors’ funds.
She said PenCom recently issued a circular allowing PFAs to invest in the parent companies of their custodians after determining that the potential conflict of interest was negligible.
The PenCom boss explained that the parent companies involved are largely Tier-1 banks, including First Bank, United Bank for Africa (UBA) and Zenith Bank, which she described as A-rated institutions with strong financial foundations.
She said the policy was intended to widen investment opportunities for pension funds without compromising safety.
Using Stanbic IBTC as an example, Ms Oloworaran explained that if its custodian is Zenith Bank, the previous restriction prevented the pension administrator from investing in Zenith Bank shares despite the bank’s strong performance.
“We reviewed the risks and any potential conflict of interest and found the risks to be very low. That is why we opened that investment window,” she said.
By Aduragbemi Omiyale
Analysts at Meristem Research have predicted that the inflation rate for June 2026 in Nigeria should marginally rise to 15.95 per cent on a year-on-year basis from the 15.93 per cent reported in May 2026.
The National Bureau of Statistics (NBS) is expected to release inflation numbers for last month later today, Wednesday, July 15, 2026.
In its report sighted by Business Post, Meristem Research said it expects inflationary pressures to re-emerge across key economies in the near term, as the re-escalation of the US-Iran conflict has reignited upward pressure on global oil prices.
It disclosed that this marks a sharp reversal from most of June, when the ceasefire between the two countries helped drive oil prices lower, raising expectations of some relief on the inflation front.
With conflicts now flaring up again, oil prices are likely to increase again, and the anticipated easing in energy-driven inflation may not materialise as broadly as earlier envisaged.
“Nonetheless, some relief is likely from the food segment, where robust supply conditions across major producing regions and softening demand should continue to ease food price pressures,” it stated.
The team also explained that it projected a 15.95 per cent inflation rate because of the lingering effects of persistent food price pressures.
“However, we expect core inflation to moderate as the sharp reversal in energy prices begins to filter through to transportation, distribution, and other energy-related costs, easing underlying price pressures.
“On a month-on-month basis, the combined effect of lower petrol prices, a relatively stable Naira, and the gradual pass-through of reduced energy costs across the supply chain should exert further downward pressure on inflation.
“Based on our assessment, food inflation is expected to remain the key swing factor, as seasonal pre-harvest supply constraints are likely to offset some of the gains from lower logistics costs,” it said.
By Adedapo Adesanya
The duo of Central Securities Clearing System (CSCS) Plc and Afriland Properties Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.61 per cent on Tuesday, July 14.
CSCS Plc saw its stock value drop N9.08 to close at N82.40 per share compared with the preceding session’s N91.48 per share, and Afriland Properties Plc slid by 17 Kobo to sell at N15.00 per unit versus N15.70 per unit.
The losses recorded by the two securities pulled back the market capitalisation by N41.64 billion to N2.546 trillion from N2.587 trillion, and cracked the NASD Security Index (NSI) by 69.36 points to 4,242.31 points from 4,311.67 points.
It was observed that the exchange witnessed two price advancers during the session, led by FrieslandCampina Wamco Nigeria Plc, which gained N1.37 to end at N151.37 per share compared with the previous day’s N150.00 per share, and Food Concepts Plc chalked up 5 Kobo to settle at N2.50 per unit versus N2.45 per unit.
The volume of securities traded by market participants surged by 50.7 per cent to 13.7 million units from the previous 9.1 million units, while the value of securities went down by 79.7 per cent to N65.2 million from N320.4 million, and the number of deals crashed by 3.6 per cent to 27 deals from the previous session’s 28 deals.
At the close of transactions, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with the sale of 3.4 billion units for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc, which exchanged 2.3 billion units valued at N6.5 billion, and CSCS Plc with 73.9 million units transacted for N5.2 billion.
GNI Plc also closed the trading day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
