FG Dismisses ‘Hidden Spending’ Claims, Clarifies World Bank Report

The Federal Ministry of Finance has refuted claims that Nigeria is engaging in “hidden spending” or diverting federation revenue, describing such interpretations as a misreading of the latest Nigeria Development Update by the World Bank.

In a statement issued on Sunday, the Honourable Minister of State for Finance, Taiwo Oyedele, said recent media reports and commentaries had distorted the report’s findings, particularly around deductions from the Federation Account.

According to the ministry, deductions by the Federation Account Allocation Committee (FAAC) have been wrongly labelled as waste or missing funds. It explained that these deductions cover legitimate fiscal obligations, including statutory transfers, savings and investments, security expenditures, cost-of-collection charges, and refunds to Ministries, Departments and Agencies (MDAs), as well as interventions benefiting states and other tiers of government.

The statement stressed that such transfers and refunds are not leakages but lawful financial flows backed by statutory provisions, including repayments and allocations due to subnational governments.

The ministry also accused some commentators of selectively using outdated data while ignoring recent reforms highlighted in the World Bank report. It noted that measures introduced in early 2026—such as a new Executive Order aimed at safeguarding petroleum revenue remittances—are already improving transparency and are projected to boost distributable revenues by about 0.4 percent of GDP annually.

Highlighting the broader findings of the report, the ministry said Nigeria’s economic outlook remains positive, citing more diversified growth across sectors, a gradual decline in inflation, improved foreign reserves, and a current account surplus. It also pointed to a reduction in the country’s debt-to-GDP ratio—the first such decline in over a decade.

The statement maintained that the World Bank report does not suggest a failing fiscal system but instead affirms that ongoing reforms are yielding results and should be sustained to drive inclusive growth.

Reaffirming the Federal Government’s commitment to fiscal discipline, the ministry said it would continue efforts to enhance transparency, boost revenue mobilisation, and ensure efficient public spending.

It also urged the media and stakeholders to report fiscal matters accurately and responsibly to avoid misinterpretations that could undermine public confidence in the country’s economic reform agenda.