By Daniel Oluwatobiloba Popoola
The Federal Ministry of Finance has dismissed allegations of hidden spending and diversion of federation revenue, stating that recent interpretations of the World Bank’s Nigeria Development Update are misleading and inaccurate.
In a statement issued on Sunday 19 April, 2026 the Minister of State for Finance, Taiwo Oyedele, said the claims stemmed from a misrepresentation of the report’s findings, particularly regarding deductions by the Federation Account Allocation Committee (FAAC), which he explained are legitimate fiscal transactions rather than waste or missing funds.
The ministry clarified that FAAC deductions cover statutory transfers, savings and investments, security-related expenditures, cost-of-collection charges, refunds to Ministries, Departments and Agencies (MDAs), as well as transfers and interventions to subnational governments.
It stressed that such financial flows are lawful and essential components of Nigeria’s fiscal framework.
Oyedele emphasised that refunds and allocations to states and other tiers of government should not be misconstrued as leakages, noting that they represent “legitimate fiscal flows, including repayments of obligations and statutorily backed allocations.”
Furthermore, the ministry faulted what it described as the selective use of outdated data by some commentators, arguing that such narratives ignored ongoing reforms highlighted in the World Bank report.
It pointed out that recent measures, including an Executive Order signed in early 2026 to safeguard petroleum revenue remittances, are already improving transparency and are projected to increase distributable revenue by about 0.4 per cent of GDP annually.
The statement maintained that focusing on isolated aspects of the report without acknowledging these reforms presents a distorted picture of the country’s fiscal position.
Highlighting broader economic indicators, the ministry noted that the World Bank report paints a positive outlook, with economic growth becoming more diversified, inflation gradually declining due to policy interventions, and Nigeria’s external reserves strengthening alongside a current account surplus.
It also stated that debt indicators have improved, citing a decline in the debt-to-GDP ratio for the first time in over a decade as evidence of ongoing fiscal consolidation efforts.
“The World Bank does not conclude that Nigeria’s fiscal system is collapsing or that reforms have failed. Rather, it states that reforms are working and must be sustained and deepened to translate macroeconomic gains into inclusive growth,” Oyedele said.
The ministry reaffirmed the Federal Government’s commitment to fiscal transparency, efficient public spending, and sustained reforms aimed at supporting inclusive economic growth.
It, however, urged stakeholders, media organisations, and the public to engage responsibly with fiscal data, warning against “twisted interpretations that may undermine reform efforts and fuel public discord.”
