September 13, (THEWILL) – Nigeria’s state governors are presiding over one of the biggest revenue opportunities available to the country’s subnational governments in decades. Yet, instead of converting the unprecedented inflow of public money into productive assets, stronger human capital and a more competitive local economy, many states are spending heavily on executive comfort, political showpieces and projects of questionable economic value.
Finance experts contend that the real value of the revenue has diminished because of the prevailing exchange rate, which makes logistics and operational costs very prohibitive. The point, they say, is that many of the subnational governments are embarking on trivial projects, leading to the mismanagement of both funds and opportunities.
The irony is profound. At a time when millions of Nigerians are struggling with food inflation, unemployment, insecurity, poor healthcare and deteriorating living standards, governments that have never had access to this volume of resources appear increasingly comfortable spending public money on government houses, luxury vehicles, renovations, foreign travel, ceremonial infrastructure and other politically attractive projects.
The Numbers Tell the Story
In 2025, the 35 states assessed by Agora Policy, a Nigerian think-tank and non-profit, generated a combined N16.64 trillion, of which N12.40 trillion, or 75 percent, came from the Federation Accounts Allocation Committee, FAAC, while N4.24 trillion came from internally generated revenue.
The 2025 State of States report by BudgIT, a Nigerian civic organisation and finance think-tank, similarly showed that the combined revenue of 35 states rose to N17.17 trillion in 2024, almost double the N8.66 trillion recorded in 2023. Gross FAAC alone jumped by 110.74 per cent, from N5.4 trillion to N11.38 trillion.
The windfall continued into 2025. Between January and November, the three tiers of government shared N33.27 trillion through FAAC, about 30 percent above the N25.46 trillion distributed during the corresponding period of 2024. State governments received N6.713 trillion during those 11 months.
The extraordinary revenue story has continued into 2026. A special FAAC intervention for state infrastructure and security has become another major source of funding. Between 2024 and June 2026, states and the Federal Capital Territory received about N2.9 trillion through this window, while available state budget implementation reports showed at least N435 billion recorded by 29 states under the infrastructure and security intervention during the first half of 2026.
‘Where is the Money?’
For the first time in years, the removal of the fuel subsidy, higher federation revenues, windfall from the devaluation of the naira and improved IGR have substantially expanded the resources available to governors, according to ‘facts behind the figures’. Yet, across much of the country, ordinary citizens and experts alike are still asking the same question: Where is the money? And the question is becoming harder to dismiss.
Yet the paradox remains stark: more money has not necessarily produced proportionately better lives. Instead, too many governors appear to be trapped in a political culture in which expenditure is judged by visibility rather than impact; by the size of the structure rather than the number of lives transformed; and by the applause generated at commissioning ceremonies rather than the economic value created afterwards. That is the real danger of Nigeria’s state-level revenue boom.
Government House First, People Later
Again, according to the ‘facts and figures,’ the appetite for executive comfort is even more striking when individual budget items are examined.
At least 12 states earmarked about N102 billion in their 2025 budgets for official-lodge upgrades, office renovations and vehicle procurement.
Lagos alone allocated about N33 billion for vehicle procurement and lodge upgrades. Adamawa provided N6.46 billion, including N2.9 billion for 42 SUVs. Kebbi allocated N5.66 billion, while Ekiti earmarked N5.16 billion for vehicles and executive residences.
These figures raise a fundamental question being asked by the experts about development priorities.
What would N2.9 billion spent on 42 SUVs mean if redirected to primary healthcare centres, agricultural extension services, rural roads, irrigation, water systems or vocational training?
What would N33 billion do for thousands of young people if deployed into productive enterprises instead of executive vehicles and lodge upgrades?
The issue is not whether governors require official vehicles or decent offices. They do. The issue is the scale, timing, and opportunity cost of such expenditure.
The combined basic salaries of all 36 governors for six months would amount to about N108.65 million. Yet the states spent almost N512 billion on the broader executive-administration and travel categories during the same period.
At a time when millions of Nigerians cannot afford basic healthcare, when rural roads remain impassable and when public schools lack desks, laboratories and teachers, government expenditure should be relentlessly subjected to one question:
Does this spending produce a greater public benefit than the alternatives? Too often, the answer appears to be no.
The SUV Culture
The obsession with official vehicles is another manifestation of the problem. In 2025, at least 12 states reportedly earmarked approximately N102 billion for upgrading official lodges and offices and acquiring SUVs and other vehicles. The states identified were Lagos, Adamawa, Borno, Cross River, Delta, Ekiti, Imo, Jigawa, Kebbi, Ondo, Taraba and Yobe. Lagos alone accounted for about N33 billion in the analysis.
There is nothing inherently wrong with providing appropriate official transportation. But a state struggling to provide basic public services must distinguish between administrative necessity and elite convenience.
The same concern was raised in Akwa Ibom, where media reports showed that the state recorded N1.134 trillion in revenue in 2025 but budgeted N1 billion for 10 SUVs for former deputy governors and political figures, at N100 million each. The report noted that, at the budgeted rate for school furniture, the same N1 billion could have procured approximately 25,000 pupil seats.
A government must decide whether public resources should first purchase comfort for former political office holders or provide basic learning conditions for children.
Flyovers Where Traffic Does Not Exist
The most visible symbol of misplaced priorities may, however, be the proliferation of flyovers. Flyovers are important pieces of urban infrastructure when traffic volumes, road geometry and economic activity justify them. They can reduce congestion, shorten travel time and improve logistics. But infrastructure becomes wasteful when it is built because it looks impressive rather than because it solves a demonstrable problem.
This concern has become so serious that President Bola Tinubu himself recently advised governors against constructing flyovers in areas where traffic does not justify them.
In Niger State, for instance, five flyovers were reportedly under construction in Minna, with some projects having remained under construction for about three years. A former state commissioner, Jonathan Vatsa, publicly criticised what he described as misplaced priorities, although the state government has maintained that the projects are designed to improve traffic flow and urban infrastructure.
According to Mike Akannor, an economist and finance expert, governors are naturally attracted to projects that can be seen before the next election. But development is often built through investments whose benefits are less spectacular and take longer to materialize, such as flyovers.
Akannor explained that a flyover is attractive politically because it is visible. It can be commissioned. It can carry the governor’s name on billboards. Its concrete structure provides physical evidence of government activity. On the other hand, a primary healthcare centre stocked with medicines does not. A well-trained teacher does not. A functional water system buried underground does not. An agricultural extension service does not. That is why the political economy of infrastructure matters.
The Airport Prestige Project
The same temptation exists in the aviation sector. Nigeria already has a large network of airports and airstrips, while many states continue to struggle with poor road networks, inadequate industrial infrastructure and weak connectivity.
Many governors have spent billions of naira on creating airports in their states. However, most of these airports have not been attracting a considerable number of aircraft for charter or commercial purposes. A recent report showed that about ten states in Nigeria have airports that were never completed for decades or abandoned by succeeding governments in the affected states.
In 2017, Governor Willie Obiano of Anambra State launched a project to build a cargo airport in Umueri despite its proximity to airports in neighbouring states. He envisioned an “airport city” with two runways, a hotel, an industrial park, a convention centre, and an aircraft maintenance facility.
He boasted that it would be one of the most advanced in the world and capable of landing sophisticated aircraft. Nine years after the multi-billion-naira airport, the facility remains grossly under-utilised. Alarmingly, the present Governor Charles Soludo administration has embarked on another international airport at Ndikelionwu – about 60 kilometers from the first airport.
In April 2026, Kogi officially handed the project site to contractors to build the new Kogi International Airport in Zariagi, near the capital city of Lokoja. The government said it would improve regional transportation, facilitate the movement of agricultural and mineral resources, and attract foreign investment.
Ebonyi Airport: Then Governor David Umahi invested over N36 billion in the project. However, despite the significant investment, the airport in Onueke has been described as “comatose”, raising concerns about the project’s viability and sustainability and questioning the wisdom of the large sum spent on a facility that appears to be non-operational. Even so, current Governor Francis Nwifuru’s administration has spent N17.3 billion on the runway, terminal building, and control tower.
Similarly, from Ekiti State, where ex- Governor Kayode Fayemi spent over N16bn on Akure Airport, which has failed to attract aircraft, to Jigawa, where former Governor Sule Lamido of Jigawa spent N4 billion on building an airport, which is less than 100km from Aminu Kano International
Airport, and Bayelsa, where former Governor Seriake Dickson spent N70 billion on constructing an airport which remains rarely in use, as well as in Yobe State’s N18 billion airport project with no flights operating from the facility, and Nasarawa’s N15 billion Usman Dan Fodio Airport in Lafia, incumbent governors are facing a maintenance nightmare with resources that ought to be deployed to productive use. This has raised questions about the wisdom of investing such a large sum of money in a project that has yet to yield any benefits.
Stakeholders argue that the huge resources invested in the airports may be better utilised in roads linking farms to markets, electricity for industrial clusters, water systems, healthcare facilities, digital infrastructure, or skills development. A state does not become economically developed merely because it possesses an imposing terminal building.
FAAC Dependence: The Dangerous Comfort
The revenue windfall also carries a hidden danger. It can make governors less interested in building sustainable local economies.
The World Bank’s assessment of H1 2025 showed that many states remained heavily dependent on FAAC. Adamawa derived about 93 per cent of total revenue from FAAC, while Akwa Ibom, Bayelsa, Taraba and Ebonyi also had very high dependence. Lagos was the major exception, with IGR accounting for a much larger share of its revenue.
BudgIT’s analysis similarly showed that 31 states relied on federal transfers for at least 80 per cent of their recurrent revenue. This means that a large part of the apparent prosperity of many states is externally generated. A governor may receive billions without necessarily creating a single new factory, expanding the tax base, attracting major investment, or increasing productivity. That is not fiscal transformation. It is fiscal distribution.
And the danger is that when oil prices fall, production declines or federal revenue weakens, the apparent prosperity disappears.
An Uncomfortable Fact Behind the Figures
Standing in sharp contrast to the growing FACC windfall for the states is the almost directly proportional decline in the livelihood of millions of Nigerians. In April 2026, the World Bank reported that Nigeria’s poverty rate has climbed to 63 per cent, despite a slowdown in inflation.
In its report, titled Nigeria’s Tomorrow Must Start Today: The Case for Early Childhood Development, the global bank said the share of Nigerians living below the poverty line increased from 56 per cent in 2023 to 61 per cent in 2024, before rising to 63 per cent in 2025. In population, that means 140 out of 200 million Nigerians.
Though the Bank admitted that global shocks like the ongoing US-Iran war have contributed to rising food and transportation costs, for example, it identified structural challenges as major constraints to poverty reduction. Agriculture, which employs many Nigerians, has stagnated over the years.
Similarly, PricewaterhouseCoopers in its Nigeria Economic Outlook, 2026, said that “weak income growth and high living costs are undermining recent economic reforms, with families spending as high as 70 per cent on food.” According to the firm, without strong job creation, productivity gains, and effective social protection, efforts to reduce poverty will remain hard.
Worrying Voices
Muda Yusuf is one of the strongest voices for your story. He has criticised the high cost of governance at state level, excessive overheads, unnecessary staffing, corruption and weak accountability.
Muda Yusuf, CEO, Centre for Promotion of Private Enterprise, expressed concern that states have “unhealthy overheads” and that governors need to become more creative about revenue generation instead of depending heavily on FAAC. He also called for states to improve investment attraction and exploit their economic resources.
Oluseun Onigbinde, Co-founder, BudgIT, argued that Nigerian states are receiving substantially more money but that increased fiscal space has not necessarily translated into better public services. His recent analysis notes that federal transfers to states surged while poverty, weak infrastructure and poor service delivery remained major problems.
Adetokunbo Mumuni, former Executive Director, SERAP, observed that Nigeria’s governance problem was not simply a lack of resources but a failure to get priorities right. He specifically criticised governors for spending money on projects such as new airports when existing infrastructure was underutilised. He insists that governors can no longer use paucity of resources as an excuse for poor service delivery when states are receiving historically high revenues.
What the Governors Should be Doing
The answer is not to stop capital projects, finance experts say. Nor is it to condemn every flyover, road, airport or government building, according to economists. The real solution, they say, is to impose a hierarchy of priorities.
First should come basic infrastructure: roads, drainage, water, electricity, sanitation and transport systems that reduce the cost of doing business.
Second should be human capital: primary healthcare, education, teacher quality, vocational training and social protection.
Third should be productive infrastructure: agro-processing zones, industrial clusters, storage facilities, irrigation, logistics centres, digital infrastructure and financing of SMEs
Fourth should be economic diversification: states should use IGR not merely to increase tax collections but to enlarge the productive economy from which future taxes can be generated.
Fifth should be security, particularly around farming communities and commercial corridors.
Sixth should be maintenance: Nigeria has a peculiar habit of building new infrastructure while allowing existing infrastructure to decay. That is economically irrational.
“A kilometre of road properly maintained today is cheaper than reconstructing the same road five years later,” said Akannor.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
