The World Bank has reported that Nigeria’s 36 states recorded a 93 per cent increase in revenue between 2023 and 2025, even as education’s share of total state expenditure declined over the period.
The findings were contained in the bank’s latest Nigeria Development Update, which examined how rising public revenues have influenced spending priorities across the federation.
The report was made available to the News Agency of Nigeria (NAN) by the World Bank in Washington, D.C.
According to the report, aggregate state revenues increased by approximately 93 per cent in real terms between 2023 and 2025, while total expenditure rose by 92 per cent.
The bank attributed the revenue growth partly to exchange-rate reforms, the removal of petrol subsidies, improved revenue administration and increased allocations from the Federation Account.
It added that states also benefited from refunds, the settlement of longstanding federal obligations, intervention funds and stronger Value Added Tax (VAT) collections.
Despite the increase in available resources, however, education accounted for a smaller proportion of state spending, declining from 14.9 per cent in 2021 to 12.1 per cent in 2025.
Health expenditure remained broadly stable at approximately seven per cent of total spending, while social protection’s share rose from 1.4 per cent to 4.4 per cent over the same period.
The report also highlighted a significant shift towards capital expenditure, which accounted for 61 per cent of state spending, compared with 46 per cent previously.
Transport infrastructure recorded the largest increase in capital investment, alongside substantial spending on housing, agriculture and other economic activities.
The World Bank Country Director for Nigeria, Mathew Verghis, said the increase in public revenues presented an opportunity for state governments to expand investment in critical sectors, including infrastructure, education, healthcare and water services.
He stressed, however, that improved spending efficiency, accountability and service delivery were essential to ensuring that additional resources translated into tangible benefits for citizens.
The report acknowledged progress in states’ fiscal reporting, transparency and internally generated revenue, but emphasised the need to strengthen investment in human capital.
According to the bank, increased spending on education, healthcare and other essential services would be critical to translating economic reforms into sustainable employment opportunities and improved living standards.
The report projected average economic growth of 4.4 per cent between 2026 and 2028, subject to the continuation of reforms and improvements in public service delivery.
It urged federal and state governments to ensure that rising public revenues resulted in measurable improvements in citizens’ welfare, rather than being reflected primarily in higher spending figures.
The bank maintained that the effective allocation and management of public resources would be crucial to ensuring that the benefits of economic reforms reached Nigerians across the country.
NAN
