The federal government has dismissed reports alleging hidden spending and diversion of federation revenue, describing the claims as a misinterpretation of the latest Nigeria development update by the World Bank.
In a statement on Sunday issued by Taiwo Oyedele, the federal ministry of finance and signed by the minister of state for finance, the government said deductions from the Federation Account Allocation Committee (FAAC) had been wrongly portrayed as leakages or missing funds.
“The attention of the Federal Ministry of Finance has been drawn to media reports that misrepresent the findings of the World Bank’s Nigeria Development Update, particularly claims suggesting revenue diversion or hidden spending,” the statement said.
The ministry explained that FAAC deductions include statutory transfers, savings, security-related expenditures, cost-of-collection charges, refunds to Ministries, Departments and Agencies (MDAs), and transfers to subnational governments, stressing that these are legitimate fiscal processes.
It added that such deductions are often misunderstood and wrongly classified as waste or leakages.
“Refunds and transfers to states and other tiers of government are not leakages. They represent legitimate fiscal flows backed by law,” it stated.
The federal government also faulted commentators for relying on outdated figures, noting that recent 2026 fiscal reforms are already addressing revenue concerns, including an Executive Order aimed at improving petroleum revenue remittances.
According to the ministry, the World Bank report acknowledged ongoing reforms and projected improved transparency and higher distributable revenues across all tiers of government.
It further stated that Nigeria’s macroeconomic indicators show signs of gradual improvement, including easing inflation, stronger external reserves, and a reduction in the debt-to-GDP ratio.
“The report does not suggest fiscal collapse. Rather, it shows that reforms are working and must be sustained,” the ministry added.
The government urged the media and stakeholders to avoid misinterpretation of fiscal data, warning that incorrect narratives could undermine ongoing reform efforts.
“We urge stakeholders to engage constructively with fiscal information and avoid distorted interpretations that may fuel public discord,” the statement said.
