Chairman of the Presidential Fiscal Policy and Tax Reforms Committee (PFPTRC), Taiwo Oyedele, has urged state governments to translate rising revenues from fiscal reforms into measurable improvements in the lives of Nigerians.
Speaking at the launch of BudgIT’s 2025 State of States Report in Abuja, Oyedele described the situation as a paradox where governments have “more naira” while citizens have “less disposable income.” He stressed that fiscal expansion must lead to shared prosperity rather than widened inequality.
“States are receiving more money than ever before, but fiscal abundance does not automatically translate into social prosperity. We must be intentional about turning macroeconomic gains into micro-level benefits for the people,” he said.
According to the BudgIT report, states’ combined revenue rose by 31.2 percent to ₦17.17 trillion in 2024, driven largely by increased FAAC allocations. However, Oyedele noted that over 30 states remain heavily dependent on federal transfers, warning that such reliance threatens fiscal sustainability.
While acknowledging improvements in internally generated revenue (IGR) — with Enugu, Bayelsa, and Abia recording significant growth — Oyedele called for better spending discipline, noting that many states underperform in critical sectors like education and health.
He revealed that most states implemented only two-thirds of their education budgets, spending less than ₦7,000 per citizen, and achieved just 62 percent implementation in health, amounting to ₦3,500 per person.
“This is the uncomfortable truth: too many states prioritise recurrent expenditure over classrooms and clinics. No society can prosper if its people are unhealthy and unskilled,” he said.
Oyedele praised the reduction of domestic and foreign debts in some states but warned that high debt burdens in Lagos and Edo, as well as ₦1.2 trillion owed to pensioners and contractors, remain concerning.
Looking ahead, he said states’ share of VAT will rise to 55 percent — about ₦4 trillion — by 2026 under new tax reforms, urging governors to “invest, not merely spend” the coming windfalls.
“Borrowing is not the problem — unproductive use of debt is. States must borrow for infrastructure and productivity, not for overheads,” Oyedele advised.
He concluded by calling for harmonised tax administration, greater fiscal transparency, and long-term investment in human capital, saying: “Nigeria cannot afford another decade of mediocrity. The time has come for states to rise beyond survival and deliver shared, sustainable prosperity.”
