Lagos leads Nigeria’s states with N365.78 billion in H1 2026 FAAC disbursements, as total allocations rose 25.77% year-on-year.

Lagos State emerged as the biggest beneficiary of Federation Account disbursements to Nigerian states in the first half of 2026, overtaking oil-rich Delta and Rivers states as total allocations rose by 25.77% year-on-year to N4.54 trillion.

Data from the Federation Account Allocation Committee (FAAC) show that the 36 states collectively received N4.54 trillion in net disbursements between January and June 2026, compared with N3.61 trillion in the corresponding period of 2025.

The increase represents a rise of N930 billion, reflecting stronger revenues from statutory allocations, Value Added Tax (VAT), derivation revenue, the Electronic Money Transfer Levy (EMTL) and other revenue streams.

The top 10 recipient states accounted for N2.16 trillion, or 47.47% of the total amount distributed to states during the period.

This was an increase of N416.83 billion, or 23.97%, from the N1.74 trillion received by the same group of states in H1 2025.

Despite accounting for almost half of total state allocations, the top 10’s share fell slightly from 48.16% in the corresponding period of 2025, indicating that the increase in federally distributed revenues was somewhat broader across the states.

Lagos recorded the strongest performance among the top beneficiaries, receiving N365.78 billion in net FAAC disbursements in H1 2026, compared with N236.92 billion a year earlier.

The figure represents a 54.39% year-on-year increase, or N128.86 billion, the largest absolute increase among the 10 leading states.

Lagos also climbed from third position in H1 2025 to first place in H1 2026.

Unlike oil-producing states, Lagos received no derivation revenue. Its position was driven overwhelmingly by its share of VAT, reflecting the state’s large formal economy, commercial activity and consumption base.

The state received N344.06 billion in net VAT, alongside N10.91 billion in net statutory revenue, N3.31 billion from EMTL and N5.05 billion in non-oil revenue augmentation.

Lagos alone accounted for 16.96% of the total net FAAC disbursement to all 36 states during the six-month period.

Delta State ranked second, receiving N331.43 billion in H1 2026, compared with N299.96 billion in the same period of 2025.

Its allocation increased by N31.47 billion, representing 10.49% year-on-year.

Delta, which ranked first in H1 2025, remained one of the largest beneficiaries because of its oil-producing status and substantial 13% derivation allocation.

The state received N229.71 billion in derivation revenue, the highest derivation amount among the top 10 states.

It also received N262.54 billion in net statutory revenue, N63.39 billion in VAT, N510.42 million from EMTL and N3.83 billion in non-oil revenue augmentation.

Rivers State moved from second to third place, receiving N295.99 billion in H1 2026, compared with N264.90 billion a year earlier.

The state’s allocation increased by N31.09 billion, or 11.74%.

Rivers received N117.33 billion in 13% derivation revenue, reflecting its oil-producing status, while its VAT allocation stood at N145.49 billion.

Its net statutory allocation was N144.63 billion, with N4.07 billion in non-oil revenue augmentation.

Akwa Ibom retained fourth place with N270.27 billion, up 17% from N230.99 billion in H1 2025.

The state received N207.73 billion in net statutory revenue, N169.29 billion in derivation revenue and N57.13 billion in VAT.

Bayelsa also maintained fifth position, receiving N266.72 billion compared with N229.56 billion a year earlier, representing a 16.19% increase.

Its allocation included N169.26 billion in derivation revenue, N203.91 billion in net statutory revenue and N58.13 billion in VAT.

Kano retained sixth position, receiving N152.57 billion, up 27.09% from N120.04 billion in H1 2025.

The state received N79.42 billion in VAT, N63.49 billion in net statutory revenue and N5.98 billion in non-oil revenue augmentation.

Oyo also retained seventh position but recorded one of the strongest increases, with its allocation rising 45.99% to N139.09 billion from N95.28 billion.

The state’s performance was driven largely by VAT, which accounted for N97.09 billion of its net allocation.

Ondo State moved from 10th to eighth place, with N113.04 billion, up 28.29% from N88.11 billion.

Its allocation included N57.12 billion in net statutory revenue, N50.58 billion in VAT, N21.73 billion in derivation revenue and N3.51 billion in non-oil revenue augmentation.

Jigawa recorded one of the biggest improvements in ranking, moving from 13th in H1 2025 to ninth in H1 2026.

The state received N111.61 billion, compared with N85.62 billion a year earlier, representing a 30.36% increase.

Its allocation included N49.01 billion in net statutory revenue and N55.89 billion in VAT.

Borno completed the top 10 after moving up from 11th position in H1 2025.

The state received N109.65 billion, up 24.69% from N87.94 billion in the previous year, supported by N48.69 billion in net statutory revenue and N53.57 billion in VAT.

The H1 2026 figures show that FAAC disbursements remain concentrated among a relatively small number of states, although the drivers of the allocations differ.

The top 10 states accounted for 92.66% of total derivation revenue, 53.25% of net statutory disbursements, 44.02% of net VAT disbursements and 41.04% of EMTL distributions.

Five oil-producing states — Delta, Rivers, Akwa Ibom, Bayelsa and Ondo — collectively received more than N707.32 billion in derivation revenue, accounting for nearly all derivation funds shared during the period.

By contrast, Kano and Oyo featured prominently because of their strong VAT receipts and broad-based economic activity.

The figures therefore highlight the growing importance of both oil production and domestic economic activity in determining how states benefit from the Federation Account.

FAAC distributes federally collected revenues among the federal, state and local governments. Its revenue sources include statutory revenue, VAT, EMTL and other federally collected income, while oil-producing states receive a constitutionally mandated 13% derivation share from mineral revenues.

With total state disbursements rising to N4.54 trillion in H1 2026, the latest figures suggest that states with strong consumption bases and economic activity are increasingly able to compete with oil-producing states for a larger share of federally distributed revenues. (Arise News)

Update news