Twenty-six Nigerian states are increasingly dependent on allocations from the Federation Account as their internally generated revenue remains insufficient to cover rising personnel and wage expenses.
The situation highlights the growing financial pressure on state governments, many of which are struggling to generate enough local revenue to meet their recurring obligations without relying heavily on monthly allocations from the Federation Account Allocation Committee.
The rising cost of salaries and other personnel expenses has further widened the gap between internally generated revenue and the amount states require to run their governments.
The development has raised concerns about the financial sustainability of states, particularly as a significant share of their available resources is being consumed by recurrent expenditure rather than being directed towards infrastructure and other development projects.
Financial experts have continued to urge state governments to improve their revenue collection systems, reduce leakages and expand their economic base to lessen their dependence on federal allocations.
