A former President of the Nigerian Bar Association, Olisa Agbakoba, has raised fresh concerns over the state of Nigeria’s Federation Account, warning that rising revenue deductions and under-remittances are pushing the country deeper into financial distress.
Agbakoba, in a statement shared via his X handle on Wednesday, described the Federation Account as the “financial heartbeat” of the country, stressing that its current condition poses a major threat to economic stability.
According to the senior advocate, many Nigerians are unaware of the constitutional role of the Federation Account, which was established under Section 162 of the 1999 Constitution to receive and distribute revenues among the federal, state and local governments.
He alleged that huge deductions from government earnings before remittance into the account had significantly weakened public finances.
“Most Nigerians are unaware that the country has a vital financial institution known as the Federation Account. Created under Section 162 of the 1999 Constitution, this account is designed to collect and store every kobo of revenue generated by the Federal Government,” he said.
Agbakoba claimed that about N14.94tn, representing nearly 40 per cent of the federation’s total revenue in 2025, was deducted before reaching the account.
He further alleged that the Nigerian National Petroleum Company Limited withheld N500bn out of N1.1tn expected to be remitted in 2024.
The former NBA president also referenced an ongoing Federation Account Allocation Committee investigation into alleged under-remittances amounting to $42.37bn between 2011 and 2017.
He expressed concern over Nigeria’s debt profile, noting that debt servicing consumed 69 per cent of federal revenue last year, above the International Monetary Fund’s recommended threshold of between 30 and 40 per cent.
“Our total public debt has now ballooned to N159.27tn. In essence, we are borrowing against funds that we have already earned because that revenue never reaches the Federation Account,” Agbakoba stated.
He disclosed that he had prepared a policy reform proposal for President Bola Tinubu aimed at strengthening Executive Order 9 and improving transparency in the management of public revenue.
Agbakoba called for national dialogue on reforms needed to restore accountability and safeguard the country’s financial system.
