The World Bank says Nigeria’s 36 states recorded a 93 per cent increase in revenues between 2023 and 2025 but education received a declining share of the sector’s expenditure.
The World Bank disclosed this in its latest Nigeria Development Update, which examined how increased public revenues have influenced spending priorities across the federation.
According to the report, states’ aggregate revenues rose by approximately 93 per cent in real terms, while expenditure increased by 92 per cent during the period.
The report attributed the improvement partly to exchange-rate reforms, petrol subsidy removal, stronger revenue administration and increased allocations from the federation account.
It said states also benefited from refunds, settlement of longstanding federal obligations, intervention funds, and stronger Value Added Tax collections.
The World Bank said education’s share of total state expenditure declined from 14.9 per cent in 2021 to 12.1 per cent in 2025.
Health expenditure remained broadly stable at approximately seven per cent, while social protection’s share increased from 1.4 per cent to 4.4 per cent.
The World Bank said capital expenditure increased significantly, accounting for 61 per cent of state spending, compared with 46 per cent previously.
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Transport infrastructure recorded the largest increase, alongside substantial spending on housing, agriculture and other economic investments.
The World Bank Country Director for Nigeria, Mathew Verghis, said increased revenues provided the opportunity to improve infrastructure, education, healthcare, and water services.
He said greater spending efficiency, accountability and improved service delivery were essential to ensuring that additional public resources benefited Nigerians.
The World Bank acknowledged improvements in states’ fiscal reporting, transparency and internally generated revenue.
The bank, however, stressed that stronger investment in human capital was necessary to translate economic reforms into sustainable employment and improved living standards.
The bank also projected average economic growth of 4.4 per cent between 2026 and 2028, subject to sustained reforms and improved service delivery.
The World Bank urged federal and state governments to ensure that increased public revenues translated into tangible improvements in Nigerians’ welfare.
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