The Federal Government has dismissed reports suggesting that deductions from the Federation Account Allocation Committee (FAAC) amount to a diversion of public funds, describing such claims as a misrepresentation of both its fiscal operations and the World Bank’s findings.
In a Sunday statement signed by Taiwo Oyedele, Minister of State for Finance, the ministry said certain media outlets had distorted the conclusions of the World Bank’s latest Nigeria Development Update (NDU), framing routine statutory deductions as hidden spending or missing revenue.
The ministry clarified that the deductions flagged in the World Bank report cover a range of legitimate financial activities, including statutory transfers, savings and investments, security-related expenditures, cost-of-collection charges, refunds to Ministries, Departments and Agencies (MDAs), and transfers to subnational governments.
“These interpretations misrepresent the World Bank’s analysis and reflect a misunderstanding of the fiscal system,” the ministry stated, adding that characterising FAAC deductions as waste or missing funds is simply incorrect.
The government also pushed back on the framing of refunds and transfers to states as leakages, stressing that they represent legitimate fiscal flows backed by statute, including repayment of obligations to lower tiers of government.
The World Bank, in its Nigeria Development Update, noted that ongoing reforms are expected to improve transparency in how federation revenues are managed and reported.
