A dispute over the allocation of N1.969 trillion among Nigeria’s three tiers of government has stalled the distribution of federation revenue for a second consecutive week, The Nation has reported.
The delay has affected the payment of January salaries for civil and public servants in several parts of the country. Typically, government workers are paid within five days following the monthly meeting of the Federation Account Allocation Committee (FAAC), where funds from the federation account are shared.
However, this month, the allocations agreed at the FAAC meeting held on January 20, 2026, in Abuja have yet to be released to the federal, state, and local governments.
Sources said the hold-up is due to objections from state Finance Commissioners, who represent the 36 states at FAAC meetings. They reportedly rejected the proposed allocation, claiming it was too low and did not reflect the revenue actually collected in December 2025.
“The states argued that the amount presented for sharing does not match what was realised in December. That is why they refused to approve the distribution,” a source said.
To resolve the deadlock, a new FAAC meeting has been scheduled for Monday. “It is possible that the figures will be adjusted to satisfy the states,” the source added.
At the January meeting, FAAC had proposed sharing N1.969 trillion from a total revenue of N2.585 trillion recorded in December 2025. The meeting was chaired by Minister of State for Finance, Dr. Doris Uzoka-Anite.
A breakdown of the revenue showed N846.5 billion from Value Added Tax, N1.631 trillion from other statutory sources, and N38.1 billion from the Electronic Money Transfer Levy.
Under the proposed allocation, the Federal Government was to receive N653.5 billion; the 36 states and the Federal Capital Territory were to share N706.4 billion; and the 774 local government councils were set to receive N513.2 billion. Additionally, oil-producing states were to get N96 billion as their 13 percent derivation from oil revenue.
The delay has sparked concern in many states, which rely heavily on FAAC allocations to run their governments. About 31 states depend on these funds for at least 80 percent of monthly expenditures, including paying workers’ salaries and funding essential projects.
A state official, who asked not to be named, said: “Without this allocation, it becomes extremely difficult to meet our obligations, especially salaries and essential services.”
FAAC comprises representatives from key government and revenue agencies, including the Federal Ministry of Finance, the Office of the Accountant-General of the Federation, the Nigerian National Petroleum Company Limited, Nigeria Customs Service, Federal Inland Revenue Service, state Finance Commissioners, and local government representatives.
As workers across the country await their January salaries, all eyes are on the upcoming FAAC meeting, with hopes that an agreement will finally be reached and the delayed funds released.
