Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said federal allocations alone could not guarantee prosperity for states, urging them to develop sustainable sources of revenue and strengthen their productive capacity.

Oyedele said Nigeria recorded about N15.8 trillion in savings from fuel subsidy removal and foreign exchange reforms between June 2023 and December 2025. However, he explained that the money was shared among the Federal, state and local governments and was not a huge pool of cash retained by the Federal Government.

He said the reforms had increased monthly Federation Account allocations from between N300 billion and N600 billion before 2023 to more than N2 trillion.

The minister urged states to diversify their economies, improve internally generated revenue and focus on production, investment and job creation rather than depending heavily on federal allocations.

He also explained that the Federal Government continued to borrow because its revenues remained insufficient to meet its growing obligations, including wages, debt servicing, infrastructure and electricity subsidies.