Nigeria’s Post-Subsidy Revenue Boom: Enugu, Abia Lead As States Race To Expand Fiscal Capacity
By IFEOMA IZUCHUKWU
Nigeria’s Post-Subsidy Revenue Boom & the Test of State Fiscal Management
The removal of Nigeria’s petrol subsidy radically altered the fiscal environment facing state governments.
Between 2022 and 2025, states recorded a sharp increase in actual revenues, with some of the fastest growth coming from states that traditionally operated with much smaller revenue bases.
A new BudgIT analysis shows the scale of that change.
Enugu State emerged as the fastest-growing state in proportional revenue terms, while Abia ranked second.
The findings offer evidence of a major expansion in state resources. They also raise a more difficult question: how effectively are governments converting that fiscal expansion into sustainable development?
Enugu Records the Fastest Growth
Enugu’s actual revenue rose from ₦102.68 billion in 2022 to ₦665.85 billion in 2025.
BudgIT calculated the state’s nominal compound annual growth rate at 86.48 per cent.
Abia followed with a CAGR of 66.05 per cent.
Niger recorded 60.47 per cent, while Taraba and Bauchi posted 54.33 per cent and 53.87 per cent respectively.
The combined revenue of the states covered by BudgIT grew at a CAGR of 47.57 per cent during the period.
The pattern shows that the fiscal changes following subsidy removal affected states across different economic categories.
Revenue growth was not limited to Lagos or other states with traditionally large economies.
The Post-Subsidy Fiscal Shift
The removal of the petrol subsidy in 2023 increased the amount available for distribution through the federation account.
BudgIT’s analysis identifies higher Federation Account Allocation Committee disbursements as a major driver of the increase in state revenues.
Its broader economic-reforms publication reports that state revenue increased from ₦4.84 trillion in 2022 to ₦15.53 trillion in 2025. State expenditure also increased from ₦6.22 trillion to ₦17.88 trillion over the same period.
This created greater fiscal space for state governments.
However, it also created greater expectations.
With more resources flowing to the states, citizens have stronger grounds to demand visible improvements in public services and infrastructure.
Growth Was Uneven Across States
The revenue boom did not affect every state at the same pace.
Edo recorded a 53.28 per cent CAGR. Imo followed at 52.89 per cent, while Katsina, Anambra and Osun recorded 52.33 per cent, 52.20 per cent and 52.07 per cent respectively.
Kogi, Plateau, Oyo, Cross River, Ekiti and Gombe also recorded growth rates of around 50 per cent or more.
At the lower end, Nasarawa posted a 27.94 per cent CAGR.
Kebbi, Zamfara, Ogun and Kaduna followed with 32.59 per cent, 32.69 per cent, 32.71 per cent and 33.55 per cent respectively.
The differences point to more than the effect of federal transfers.
They also reflect variations in state economies, revenue administration and the capacity of governments to collect internally generated revenue.
Lagos Shows Why Size & Growth Are Different
Lagos provides the clearest example of why percentage growth must be interpreted carefully.
The state remained the largest revenue generator in actual terms, increasing its revenue from ₦889.45 billion in 2022 to ₦2.63 trillion in 2025.
Yet its 43.49 per cent CAGR ranked it 22nd in the comparison.
That does not mean Lagos generated less revenue than Enugu.
It means Lagos started from a much larger base and therefore needed a substantially larger absolute increase to achieve the same percentage growth.
The distinction is important when comparing fiscal performance across states with very different economic structures.
Delta Also Expands Its Revenue Base
Delta State recorded another significant increase.
Its actual revenue climbed from ₦540.84 billion in 2022 to ₦1.45 trillion in 2025.
Its CAGR stood at 38.90 per cent, below the 47.57 per cent aggregate growth rate for the states covered by the analysis.
The figures show that substantial revenue growth does not automatically translate into a leading position in percentage-growth rankings.
The starting point matters.
Two States Missing From the Picture
The comparison covered 34 states rather than all 36.
BudgIT excluded Akwa Ibom and Rivers because complete budget implementation reports were unavailable.
The organisation said it based the analysis on actual Q1-Q4 budget implementation data to ensure that states could be compared on a consistent basis.
The exclusion limits the scope of the ranking.
Both states are major oil-producing economies and have historically generated substantial public revenue.
Their absence means the findings should not be interpreted as a complete ranking of every state’s fiscal performance.
The development also highlights a broader governance issue.
Without complete and timely financial reporting, citizens, researchers and oversight institutions cannot properly assess how public resources are raised or spent.
The Real Question Is Spending
Revenue growth is only one side of the fiscal equation.
BudgIT examined expenditure growth alongside revenue, including personnel costs, overheads, capital expenditure and allocations to key sectors.
The wider report found that capital expenditure reached ₦10.85 trillion across the states in 2025.
Yet it also found that education and health accounted for smaller proportions of total state expenditure in 2025 despite increases in nominal spending.
That finding introduces an important qualification to the revenue-growth story.
A government can spend more money on education or health in absolute terms while still giving those sectors a smaller priority within its overall budget.
Consequently, rising revenue should not be treated as proof of improved service delivery.
States Still Depend Heavily on Federal Transfers
Another challenge is the sustainability of the revenue gains.
BudgIT attributed much of the increase to higher FAAC allocations while acknowledging improvements in internally generated revenue in some states.
This means that part of the post-subsidy revenue expansion has been driven by a larger national revenue pool rather than a transformation in state-level economic productivity.
That creates a long-term policy challenge.
States need to strengthen their own revenue systems without imposing excessive burdens on households and businesses.
They also need to develop productive economies capable of generating employment, investment and sustainable tax revenue.
Transparency Must Follow the Money
BudgIT said higher public revenue must be matched by transparency, accountability and citizen participation.
It specifically identified timely budget implementation reports, open procurement processes and stronger public oversight as important safeguards.
The emphasis is significant because fiscal expansion increases not only the resources available to governments but also the stakes involved in how those resources are managed.
Where financial reporting remains incomplete, citizens cannot easily determine whether higher revenue has produced better outcomes.
The exclusion of Akwa Ibom and Rivers from the BudgIT comparison illustrates that problem.
From Revenue Growth to Public Value
The post-subsidy period has clearly changed the financial position of many Nigerian states.
Enugu’s rise from ₦102.68 billion in actual revenue in 2022 to ₦665.85 billion in 2025 is the most striking example.
Abia’s 66.05 per cent CAGR also shows how rapidly fiscal capacity can expand from a relatively smaller base.
But the larger story is not simply about which state recorded the highest percentage increase.
It is about whether Nigeria’s states can turn an extraordinary expansion in public revenue into lasting economic and social gains.
That requires more than larger FAAC allocations.
It requires stronger internally generated revenue systems, disciplined expenditure, transparent procurement, timely financial reporting and measurable improvements in public services.
The post-subsidy era has given many state governments more money to work with.
The next test is whether citizens can see where the money went—and whether their lives improved because of it.
