The Federal Government has dismissed allegations of hidden spending and diversion of federation revenue, describing such claims as a misrepresentation of findings from the World Bank’s latest Nigeria Development Update.
In a statement issued by the Federal Ministry of Finance and signed by the Minister of State for Finance, Taiwo Oyedele, the government clarified that recent interpretations of the report were inaccurate and misleading.
According to the ministry, deductions made by the Federation Account Allocation Committee (FAAC) have been wrongly portrayed as waste or missing funds.
It explained that these deductions cover legitimate fiscal obligations, including statutory transfers, security expenditures, cost-of-collection charges, and refunds to Ministries, Departments, and Agencies (MDAs), as well as transfers to subnational governments.
The statement stressed that such financial flows are lawful and integral to Nigeria’s fiscal framework, noting that refunds and transfers to states should not be misconstrued as leakages.
The ministry also criticised what it described as the selective use of outdated data by some commentators, arguing that such interpretations ignored recent reforms aimed at strengthening transparency and accountability.
It highlighted policy measures introduced in early 2026, including an executive order designed to safeguard the remittance of petroleum revenues.
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These reforms, it said, are expected to increase distributable revenue across all tiers of government by approximately 0.4 per cent of Gross Domestic Product (GDP) annually.
Providing broader context, the government pointed to improving macroeconomic indicators, including a more diversified growth pattern, easing inflationary pressures, strengthened external reserves, and a current account surplus.
It also noted a decline in the country’s debt-to-GDP ratio, describing it as the first reduction recorded in over a decade.
The ministry emphasised that the World Bank report did not conclude that Nigeria’s fiscal system was failing, but rather indicated that ongoing reforms were yielding results and should be sustained to achieve inclusive growth.
Reaffirming its position, the government said it remains committed to enhancing fiscal transparency, improving revenue mobilisation, and ensuring efficient public spending.
It urged media organisations and stakeholders to engage responsibly with fiscal data, warning that misinterpretation could undermine public confidence and ongoing reform efforts.
The statement was made public by presidential spokesman Bayo Onanuga via social media on Sunday.