Atiku: FAAC surge has not translated into stronger purchasing power
FORMER Vice-President, Atiku Abubakar, has challenged the Federal Government’s claim of stronger public finances, arguing that the sharp increase in Federation Account Allocation Committee (FAAC) disbursements has largely been wiped out by naira depreciation and inflation.
Atiku, the presidential candidate of the African Democratic Congress (ADC), said the growth in allocations to the federal, state and local governments represents a rise in nominal naira figures rather than a corresponding improvement in economic value.
He made the assertion in a statement issued on Wednesday by his media aide, Phrank Shaibu. Data cited by Atiku from Agora Policy showed that FAAC disbursements rose from N4.43 trillion in the first half (H1) of 2021 to N18.72 trillion in H1 2026.
That represents a 322 percent increase in five years. FAAC distributions stood at N5.53 trillion in H1 2022 and N6.76 trillion in H1 2023 before rising sharply to N13.46 trillion in H1 2024 and N17.43 trillion in H1 2025.
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But Atiku said the increase should not be interpreted as evidence that Nigeria’s governments or citizens have become substantially wealthier.
FAAC rises, dollar value falls
According to the former vice-president, the more revealing measure is the real value of the allocations after accounting for the naira’s depreciation.
He said Nigeria distributed about N7.85 trillion through FAAC in 2019, equivalent to approximately $25.6 billion at the prevailing exchange rate.
By 2025, annual FAAC distributions had climbed to about N21.9 trillion, but Atiku said the dollar equivalent had dropped to roughly $14.6 billion.
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“In 2019, FAAC distribution was approximately N7.85 trillion, worth about $25.6 billion at the prevailing exchange rate,” he said.
“By 2025, FAAC had risen on paper to approximately N21.9 trillion, yet its dollar value had fallen to roughly $14.6 billion.”
He said the figures showed that the increase in naira revenue had been accompanied by a significant erosion in value.
“So while government parades almost three times as many naira, the underlying dollar value is more than 40 percent lower,” Atiku said.
He described the development as ‘money illusion,’ saying a larger nominal figure does not necessarily mean greater economic capacity.
Minimum wage loses dollar value
Atiku said the same dynamic could be seen in workers’ incomes. He noted that the N30,000 minimum wage was worth approximately $83 in 2019 and about $65 by May 2023.
The N70,000 minimum wage currently translates to roughly $53 at an exchange rate of N1,320 to the dollar, according to his calculation.
Atiku said the comparison demonstrates how currency depreciation can erode the impact of nominal wage increases.
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“The number written on the worker’s payslip has risen from N30,000 to N70,000, but its dollar value has fallen from about $83 to about $53,” he said.
He argued that the purchasing power of salaries, rather than their nominal naira value, should be used to assess whether workers are actually better off.
‘Where is the boom?’
Atiku also questioned why the sharp rise in FAAC distributions had not produced a visible improvement in Nigerians’ living conditions.
“If FAAC is truly booming, then where is the boom?” he asked.
He pointed to food prices, transportation, electricity, healthcare, housing and employment as areas where Nigerians should be able to see the benefits of higher government revenues.
The former vice-president further questioned why many state governments remain heavily indebted despite receiving significantly larger allocations from the federation.
He called for greater scrutiny of public expenditure, including tax concessions, import waivers, revenue exemptions, duplicated government projects and abandoned projects.
Atiku said fiscal discipline should apply across government rather than being reflected mainly in measures affecting ordinary Nigerians.
He argued that the economy should ultimately be judged by what citizens can afford with their incomes, rather than by the size of government revenue figures.
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“Nigerians do not eat FAAC figures,” he said, adding that households experience the economy through the cost of food, transport, school fees, medicine and other essential goods and services.
Atiku said rising FAAC allocations could therefore not, on their own, be regarded as evidence of economic prosperity while inflation, currency depreciation and government liabilities continued to undermine purchasing power.
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About the Author
Yakubu Ibrahim
Analyst
Abuja, Nigeria
Yakubu Ibrahim is an analyst who writes stories bordering on corruption, politics, and business. He has won four journalism awards and worked in two media organisations.
