By Odesola JF., PhD
Nigeria’s states must stop treating federal allocations as money to be shared and start treating them as resources to transform lives
There is a question Nigerians should no longer be afraid to ask:
When billions of naira enter the accounts of our state governments every month, why are so many Nigerians still living as though government has no money?
Look at the figures.
Lagos — ₦200.21 billion.
Delta — ₦143.41 billion.
Rivers — ₦123.96 billion.
Bayelsa — ₦114.48 billion.
Akwa Ibom — ₦109.76 billion.
Kano — ₦75.04 billion.
Oyo — ₦68.98 billion.
And so the list continues, with all 36 states receiving substantial sums.
Taken together, the figures amount to approximately ₦2.13 trillion.
That is a staggering amount of money.
And it raises an uncomfortable question: What exactly are our states doing with these allocations?
This is not a question being asked out of mischief. It is a question being asked by the teacher who is waiting for his salary, the pensioner who has not received his entitlement, the civil servant struggling with rising costs, the young graduate who cannot find employment, the farmer whose produce cannot reach the market, and the ordinary citizen who drives through a road that has remained abandoned for years.
People are asking because they want to understand.
How can a government receive billions of naira and still say it cannot adequately meet its obligations?
THE PEOPLE ARE NOT ASKING FOR MIRACLES
Nigerians are not necessarily asking their governments to turn every state into Singapore overnight.
They are asking for basic things.
Pay workers.
Pay pensioners.
Fix the roads.
Equip hospitals.
Improve schools.
Provide water.
Support agriculture.
Create an environment where businesses can survive.
Give young people opportunities.
Protect lives and property.
These are not extravagant demands. They are the basic responsibilities of government.
Of course, nobody should pretend that every naira received by a state is available for capital projects. States have substantial recurrent obligations, including salaries, pensions, debt servicing, security, healthcare, education and administration.
But that explanation cannot become a permanent excuse for poor performance.
At some point, citizens must be able to look around and say:
“Yes, our money is working.”
THE DANGER OF ALLOCATION DEPENDENCY
One of Nigeria’s deepest structural problems is our dependence on revenue shared from the centre.
For many states, the monthly Federation Account allocation remains the financial oxygen on which government survives.
But a state should not merely survive from one FAAC allocation to another.
It should build an economy.
This distinction is extremely important.
A government that receives ₦100 billion and spends nearly all of it keeping the machinery of government running may survive for another month.
But a government that invests part of that ₦100 billion in agriculture, manufacturing, infrastructure, technology, education and small businesses may create an economic engine that generates revenue for years.
That is the difference between consumption and development.
Nigeria must move from an allocation mentality to a production mentality.
WHAT HAPPENS TO THE WORKER?
Perhaps the most disturbing contradiction is the situation where governments receive substantial allocations while workers complain about unpaid or inadequate salaries.
Let us remember what a salary means.
It means food on a family’s table.
It means rent.
It means school fees.
It means transportation.
It means medical care.
It means dignity.
When government delays the salary of a worker, it does not merely owe one individual. It affects an entire household and, ultimately, the local economy.
The worker who receives his salary buys food.
The food seller makes money.
The transport operator gets business.
The landlord receives rent.
The shopkeeper sells more.
The mechanic gets customers.
Government salaries circulate through the economy.
Therefore, prompt payment of legitimate salaries and pensions should be treated as a priority.
But workers also deserve an efficient public service. Governments should eliminate ghost workers, reduce unnecessary duplication and ensure that public expenditure is directed towards genuine public needs.
STOP BUILDING MONUMENTS; START BUILDING ECONOMIES
One of the questions governors should ask themselves before approving any major project is:
Will this project still be useful to our people 20 years after I have left office?
That question could change Nigerian governance.
We have seen governments construct impressive buildings while basic infrastructure around them remains inadequate.
We have seen projects started with fanfare and abandoned after the administration that initiated them leaves office.
We have seen governments compete over who can construct the biggest political monument.
But development is not a competition in ribbon-cutting.
Development is about impact.
A small bridge that allows farmers to take their produce to market may transform thousands of lives.
A functional agricultural processing centre can create jobs.
A well-equipped hospital can save lives.
A good technical college can produce skilled workers.
A reliable industrial estate can generate thousands of jobs and tax revenues.
These are the investments that multiply public money.
WHAT DID COUNTRIES THAT DEVELOPED DO DIFFERENTLY?
Nigeria is not the first country to face the challenge of transforming limited public resources into prosperity.
Look at South Korea.
Decades ago, it was a relatively poor country. It deliberately invested in education, infrastructure, manufacturing and export-oriented industries.
The result?
It developed globally competitive companies and transformed itself into one of the world’s major economies.
Look at Singapore.
It did not have Nigeria’s oil wealth, enormous landmass or vast natural resources.
What it had was a decision to build strong institutions, invest in human capital, develop infrastructure and create an environment where business could thrive.
Look at Malaysia.
It used natural resources while simultaneously developing manufacturing, agriculture, infrastructure and human capital.
The lesson is not that Nigeria should copy these countries exactly.
The lesson is that wealth becomes development only when it is deliberately invested in productive capacity.
AFRICA ALSO HAS LESSONS FOR US
Rwanda provides another useful example.
The country has placed considerable emphasis on public financial management, domestic revenue mobilisation, public investment management and accountability.
There are certainly legitimate debates about Rwanda’s political system and development model, but one lesson remains difficult to ignore:
A government must know what it wants to achieve and must measure whether public money is producing results.
Ghana also offers useful lessons about the need to add value to commodities rather than depending excessively on exporting raw materials.
Nigeria should learn the same lesson.
Why should a state blessed with agricultural resources continue selling raw produce when it could develop processing industries?
Why should minerals leave a state in their raw form when responsible processing could create jobs and generate additional value?
Why should tourism assets remain undeveloped?
Every state should identify its economic strengths and build an economy around them.
EVERY STATE SHOULD HAVE A 20-YEAR PLAN
This is where I believe Nigerian governors need to think differently.
A governor should not arrive in office and begin planning only for the next election.
Every state should develop a 15- or 20-year development plan that survives changes in political leadership.
Governors may change.
Political parties may change.
But the development plan should continue.
Imagine if every state could clearly answer these questions:
What are our five biggest economic opportunities?
What industries do we want to attract?
How many jobs do we want to create?
How much agricultural production do we want to achieve?
What infrastructure do we need?
How much internally generated revenue should we produce in five, ten and fifteen years?
How will we educate and train our young people?
Where will we be in 2040?
That is strategic governance.
MY ADVICE TO THE STATES
State governments should immediately consider the following:
- Publish monthly financial reports.
Tell citizens what came in and where it went.
Transparency builds trust.
- Prioritise salaries and pensions.
Workers and pensioners should not be treated as an afterthought.
- Cut administrative waste.
Reduce unnecessary political appointments, excessive bureaucracy, avoidable foreign trips and wasteful expenditure.
- Invest in productive sectors.
Agriculture, agro-processing, manufacturing, technology, tourism, education and healthcare should receive serious investment.
- Develop state economic blueprints.
Every state should know what it wants its economy to look like in 10, 15 and 20 years.
- Build projects that generate value.
Stop judging projects by size and start judging them by impact.
- Improve internally generated revenue without oppressing citizens.
The best way to increase IGR is not necessarily to introduce more taxes. It is to grow businesses, formalise economic activity and expand the tax base.
THE FEDERAL GOVERNMENT ALSO HAS WORK TO DO
The Federal Government cannot simply distribute money and walk away.
It should strengthen fiscal transparency and public financial management across all levels of government.
It should support states with major infrastructure—power, transport corridors, rail, agricultural value chains and industrial infrastructure.
It should encourage states to increase their internally generated revenue while discouraging arbitrary and oppressive taxation.
Most importantly, the Federal Government should promote a culture where performance matters.
States that demonstrate responsible financial management, measurable development outcomes and transparency should have access to stronger incentives and support.
GOVERNORS SHOULD ASK ONE FINAL QUESTION
Before leaving office, every governor should ask:
“What did the people inherit from me that they did not have before I came?”
Not how many billboards carried your face.
Not how many political appointments you made.
Not how many ceremonies you attended.
Not how many projects you commissioned.
But:
How many lives changed?
How many children received better education?
How many hospitals became functional?
How many workers were paid promptly?
How many young people found employment?
How many businesses grew?
How many farmers became more productive?
How many communities gained access to good roads and water?
How much wealth was created?
How much money was saved?
And what institutions did you leave behind?
That is the real legacy of leadership.
THIS IS THE TIME FOR A NEW SOCIAL CONTRACT
The ₦2.13 trillion question is ultimately not about mathematics.
It is about trust.
Citizens give government their resources with the expectation that government will return value to society.
When citizens see huge allocations but cannot see corresponding improvements, suspicion naturally grows.
Nigeria cannot afford that growing distrust.
Our states have resources.
Our people have talent.
Our young population is enormous.
Our land is fertile.
Our natural resources are abundant.
Our entrepreneurs are resilient.
What we need is a government culture that knows how to convert these advantages into prosperity.
The money coming to our states should not disappear into recurrent expenditure, political patronage and administrative consumption.
It should become roads.
It should become schools.
It should become hospitals.
It should become industries.
It should become jobs.
It should become food security.
It should become innovation.
It should become opportunities.
It should become hope.
The citizens are not asking for too much.
They are asking for accountability.
They are asking for responsible leadership.
They are asking for value for their money.
And they are asking a very simple question:
“With all these billions coming into our state, where is the development?”
It is time for every governor, every state assembly, every local government authority and the Federal Government to answer.
The era when allocation figures were enough should be over.
From now on, the real question should be:
NOT HOW MUCH DID WE RECEIVE, BUT HOW MUCH DID THE PEOPLE GAIN?
That is the question that should define governance in Nigeria.
