₦20trn Missing From Federation Account, Agbakoba Raises Alarm Over Revenue Leakages

Senior Advocate of Nigeria, SAN, and former Nigerian Bar Association President, Olisa Agbakoba, has raised concerns over alleged massive revenue leakages from Nigeria’s Federation Account, claiming that more than ₦20 trillion may have been lost through under-remittances and unauthorised deductions.

Agbakoba, in a policy paper titled “Where Is Our Money? Nigeria’s Federation Account Crisis and the Case for Reform,” questioned the management of revenues accruing to the Federation Account established under Section 162 of the 1999 Constitution.

According to him, all revenues collected on behalf of the federation, including oil earnings, customs duties, company taxes and regulatory fees, are constitutionally required to be paid into the Federation Account before distribution to the federal, state and local governments.

He alleged, however, that huge portions of such revenues are deducted before reaching the account.

Citing the World Bank’s Nigeria Development Update, Agbakoba stated that about ₦14.94 trillion representing 39 per cent of federation revenue in 2025 was reportedly deducted before remittance into the Federation Account.

The senior lawyer also questioned the remittances by the Nigerian National Petroleum Company Limited, alleging that the oil company remitted only ₦600 billion out of an expected ₦1.1 trillion in 2024.

He further referenced an ongoing Federation Account Allocation Committee, FAAC, investigation into alleged under-remittance of $42.37 billion by NNPCL between 2011 and 2017.

Agbakoba linked the alleged leakages to Nigeria’s worsening debt burden, noting that the country’s total public debt stood at ₦159.27 trillion at the end of 2025, according to figures from the Debt Management Office.

He said debt servicing consumed 78 per cent of federal revenue in 2023 and 69 per cent in 2024, leaving limited resources for infrastructure, healthcare, education and security.

According to him, Nigeria has continued to borrow funds to finance services that should ordinarily be funded from internally generated revenues.

The SAN argued that the constitutional framework establishing the Federation Account failed to provide clear provisions on accountability, auditing, remittance timelines and sanctions for violations.

He alleged that the loopholes have enabled agencies to deduct management costs before remittance, operate unauthorised accounts and retain revenues outside government oversight.

Agbakoba also referenced a 2023 House of Representatives investigation which reportedly uncovered the existence of unauthorised parallel accounts despite the implementation of the Treasury Single Account, TSA.

While acknowledging that the TSA introduced in 2015 under former Finance Minister Ngozi Okonjo-Iweala helped reduce leakages in government accounts, he argued that the policy did not address the constitutional issues surrounding the Federation Account.

He called for urgent reforms to strengthen transparency, accountability and constitutional safeguards in the management of Nigeria’s public revenues.