Former Vice-President and presidential candidate of the African Democratic Congress, Atiku Abubakar, has described the rising disbursements by the Federal Account Allocation Committee as a “money illusion,” arguing that increased allocations to the three tiers of government have not translated into better living conditions for Nigerians.
Atiku, in a statement issued on Wednesday by his media aide, Phrank Shaibu, said the increase in FAAC allocations must be considered against the backdrop of naira depreciation, high inflation, declining purchasing power and growing government debt.
Figures cited by the former vice-president from Agora Policy showed that FAAC disbursements rose from N4.43tn in the first half of 2021 to N18.72tn in the corresponding period of 2026, representing an increase of about 322 per cent.
The figures showed that allocations increased from N5.53tn in H1 2022 to N6.76tn in H1 2023, N13.46tn in H1 2024, N17.43tn in H1 2025 and N18.72tn in H1 2026.
However, Atiku argued that the rise in nominal naira allocations should not be interpreted as evidence of economic prosperity.
“The arithmetic is brutal. In 2019, FAAC distribution was approximately N7.85tn, worth about $25.6bn at the prevailing exchange rate.
“By 2025, FAAC had risen on paper to approximately N21.9tn, yet its dollar value had fallen to roughly $14.6bn.
“So while government parades almost three times as many naira, the underlying dollar value is more than 40 per cent lower,” he said.
Atiku described the development as “money illusion,” saying the combination of naira depreciation and inflation had eroded the real value of the increased allocations.
“That is not an economic miracle. That is money illusion,” he said.
“You cannot batter the currency, allow inflation to ravage purchasing power and then wave bigger naira figures before Nigerians as evidence that the country has become richer. Bigger numbers do not cancel smaller value.”
Minimum Wage Under Pressure
The ADC presidential candidate said the erosion of purchasing power was also evident in the value of workers’ wages.
Using the minimum wage as an example, Atiku said the N30,000 minimum wage was worth about $83 in 2019 and approximately $65 by May 2023, while the current N70,000 minimum wage was worth about $53 at an exchange rate of N1,320 to the dollar.
“Think about that: the number written on the worker’s payslip has risen from N30,000 to N70,000, but its dollar value has fallen from about $83 to about $53,” he said.
“That is Tinubu’s money illusion in its simplest form. The figure in your hand is bigger, but the value in your pocket is smaller.”
Atiku questioned why the increase in FAAC allocations had not resulted in noticeable improvements in the welfare of Nigerians.
He asked why food and transport costs remained high and why Nigerians were yet to see significant improvements in electricity supply, healthcare, housing and employment.
“If FAAC is truly booming, then where is the boom?” he asked.
“Where is it in the price of food? Where is it in transport? Where is it in electricity, healthcare, housing and jobs? Where is it in the purchasing power of salaries?”
Atiku Demands Greater Accountability
The former vice-president also questioned why many states remained heavily indebted despite what he described as unprecedented increases in FAAC revenues.
He called for greater scrutiny of government spending, particularly tax concessions, import waivers, revenue exemptions, duplicated projects and abandoned projects.
“You cannot defend concessions for the powerful, tolerate waste within government and then suddenly become an apostle of fiscal discipline when ordinary Nigerians ask for relief from unbearable living costs,” he said.
“Fiscal responsibility that operates only against the poor is not reform. It is cruelty dressed up in economic grammar.”
Atiku maintained that Nigerians experience the economy through the prices of food, transportation, school fees, medicines and other essential goods and services, rather than through government statistics or FAAC communiqués.
“Nigerians do not eat FAAC figures. They do not pay school fees with percentages. They do not buy medicine with press conferences, and they do not enter buses with government charts,” he said.
“They live in the real economy, and the real economy is measured by what their money can buy.”
He argued that higher FAAC allocations should not automatically be equated with economic prosperity when Nigerians’ purchasing power remains weak and government liabilities continue to rise.
