By Olawale Lamina
The Democratic Front (TDF) has described the 111% increase in allocations to states as a major milestone in the ongoing economic reforms of the President Bola Tinubu administration.
In a statement signed by its Chairman, Mallam Danjuma Muhammad, and Secretary, Chief Wale Adedayo, TDF argued that the states are better placed than ever before to support the federal government’s efforts to improve the well-being of the people.
We received the heartwarming news of a 111% increase in fund allocations to state governments from the Federation Account Allocation Committee (FAAC) with great joy and expectations for more economic growth and development at the sub-national levels.
”TDF notes that FAAC allocations to state governments have consistently remained in an upward trajectory since the commencement of the twin economic reforms of withdrawal of fuel subsidy and the unification of exchange rates under a market-friendly free float regime.
”The latest surge in the allocation to the states from FAAC is indicative of a geometric progression in revenue generation, financial prudence, fiscal discipline, and resource optimisation by the federal government.
”This is no doubt a remarkable milestone that should serve as an incentive to state governments to do more in the provision of social amenities, economic growth, and infrastructural development at sub-national levels across the country
”This new development is a justification of President Bola Ahmed Tinubu’s position that the removal of fuel subsidy and unification of exchange rates would reposition Nigeria’s economy for a historic rebound, if the government stays the course to allow for a long-term implementation.
”The Tinubu economic reforms have also ensured that 5% of the nation’s GDP is freed into the federation account in 2025. This is in addition to the culture of transparency, better project delivery, and credible public expenditure tracking, which have brought credibility to the management of the economy, due to the visibility of the federal government’s accounts with the Central Bank of Nigeria.
”It is also commendable to note that the success of President Tinubu’s transformative revenue generation strategy is reflected in the debt-to-GDP ratio, currently at 40%, far below the international threshold of 70% for developing countries like Nigeria.
”The significance of this monumental increase in FAAC allocations to states is the sudden boost in financial capability for state governments to embark on social intervention programs and infrastructural developments at sub-national levels.
”We, however, welcome decisions by 12 states in Nigeria to pay workers salaries above the national minimum wage of N70,000 as a good start,” it added.
TDF also urged state governors to use improved FAAC allocation to better the lot of their people by channelling state allocations to projects and programmes that would improve the living standards and conditions of their people.
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