The World Bank has revealed that Nigeria’s 36 state governments recorded a massive 93% surge in real revenues between 2023 and 2025. However, despite the substantial cash inflow, the proportion of public expenditure allocated to the education sector experienced a noticeable decline.
According to an official statement disclosed to the News Agency of Nigeria (NAN) by the World Bank, the sudden spike in subnational revenue stems primarily from ongoing economic policies, including foreign exchange adjustments, fuel subsidy removal, improved tax administration, and larger allocations from the Federation Account.
Additional funds, such as federal intervention grants and settlement refunds, also contributed heavily to expanding state government coffers across the federation.
While state expenditures expanded alongside revenues, the global financial institution highlighted a shift in spending priorities.
Capital investments dominated state budgets—jumping to 61% of total spending, up from 46%—with heavy focus directed toward transport infrastructure, housing, and agriculture. Consequently, while spending on social services increased in absolute monetary terms, education’s share of state budgets fell from 14.9% in 2021 to 12.1% in 2025. Meanwhile, health funding remained stagnant at around 7%, though social protection allocations saw an uptick from 1.4% to 4.4%.
Reflecting on the financial assessment, World Bank officials stressed that state leaders must purposefully direct increased public wealth toward critical human capital investments.
The bank advised that long-term economic stability, job creation, and poverty reduction will depend on balancing physical infrastructure development with robust funding for healthcare and quality education.
You Might Also Like
