State, lg enjoying the surplus n7.1trn under the administration of Tinubu – Edun

The federal government said the state and local government had received significantly higher funds under the current government, which led to a combined surplus of around 7.1 trillion.

The Minister of Finance and the Coordinating Minister for Economic, Wale Edun, made this known to the Press Briefing in Abuja on Thursday, noting that the funds included legal allocation and refund for previous reduction. He explained that the increase in inflow was a direct result of the results of the removal of fuel subsidies that were passed down to Nigeria through the sub-national government.

“We increase the resources available for sub-nationals, to states, for education, health and infrastructure,” said Edun. “We make a repayment of reducing the past to the federation account, the funds that are legally owed at the sub-national government level. The payment is made regularly.”

According to him, since the first half of 2023, the joint fiscal balance of the state has increased from 1.8% of GDP – around ₦ 2.8 trillion – to 3.1% of GDP, which was translated into a surplus of 7.1 trillion. “That means that the countries have been given funds that now allow them to be in a surplus. And of course, which gives them a greater capacity to invest, and from the point of view of economic classification, it must be said that the increase in state expenditure has actually been used for capital expenditure,” he said.

Edun also revealed that in the last quarter, the Federal government settled more than 2 trillion in an extraordinary capital budget obligation from 2024. He said the focus would now turn to the capital release of 2025.

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Reviewing the country’s fiscal position, the Minister reported that the federal government reached 37.4% of its revenue target in the first half of 2025. “Gross income is 37.4% of government revenue targets in the first half of 2025,” he stressed. Following the GDP rebasing, he added, the debt to Nigerian GDP ratio had dropped from 52.1% to 38.8%.

In fiscal discipline, Edun said: “When we look at the fiscal position of the government and public finances, under the leadership of the president, the courageous steps have been taken to restore discipline and fiscal balance. We have ended an unauthorized funding and above the limits and means, which is a natural default when looking for funds to fund anything.”

He further revealed plans to review the cost of collecting income deducted by institutions such as Nigeria Customs Service, Federal Inland Revenue Service (FIRS), the Nigerian Upstream Oil Regulation Commission (NUPRC), as well as management costs collected by NNPC LTD to manage the two border exploration funds and public operations.

“We will look for to review the reduction of federation accounts that come from things such as collection costs from various institutions …,” he said, adding that the government would prioritize expenses and explore more ways to generate income from existing national assets.