President Bola Tinubu’s approval for the Economic and Financial Crimes Commission (EFCC) to monitor Federation Account Allocation Committee (FAAC) allocations to states and local governments has brought renewed attention to concerns over the weakening oversight capacity of state Houses of Assembly.

Governance experts who spoke to BusinessDay said the presidential directive highlights longstanding weaknesses in legislative accountability at the state level, warning, however, that the EFCC’s intervention must not displace the constitutional responsibilities of existing oversight institutions.

They argued that state legislatures and auditors-general should ordinarily provide the first line of accountability by scrutinising government expenditure, ensuring that public funds are used for approved purposes and holding governors accountable.

A top source within the commission confirmed to BusinessDay that monitoring of FAAC allocations had commenced.

Read also: States fail to translate record FAAC inflows into public welfare

“The process of monitoring FAAC has begun,” the source told BusinessDay.

The source, however, declined to provide further details about the exercise.

The development follows President Tinubu’s approval of the EFCC’s involvement in tracking the utilisation of allocations to the 36 states and 774 local government areas as the Federal Government seeks to strengthen accountability in public financial management.

The scale of resources flowing to subnational governments has increased significantly. Between 2023 and 2025, states received approximately N19.64 trillion from FAAC, while local governments received about N11.73 trillion, bringing their combined allocations to N31.37 trillion, according to available figures.

State allocations rose from N4.18 trillion in 2023 to N6.53 trillion in 2024 and N8.93 trillion in 2025, while local government receipts increased from N2.60 trillion to N3.77 trillion and N5.35 trillion over the same period.

Between January and September 2026, states received approximately N7.01 trillion, while local governments received N4.92 trillion, bringing their combined allocations to N11.93 trillion. Oil-producing states received an additional N1.53 trillion in 13 percent derivation revenue, according to an analysis of FAAC disbursement data by Agora Policy.

The rising allocations have intensified questions about the efficiency of public spending at the subnational level, particularly as increased revenue has not been matched by corresponding improvements in public services and living conditions in many communities.

Despite the additional resources, Nigerians continue to contend with inadequate infrastructure, poor healthcare and education facilities, unemployment and insecurity.

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Vahyala Kwaga, Country Director of BudgIT, said the federal government’s involvement in monitoring state expenditure must be guided by federalism and the constitutional separation of powers.

He noted that FAAC allocation information was already publicly disclosed, arguing that the primary responsibility for ensuring accountability in state finances rested with institutions constitutionally empowered to oversee state governments, particularly Houses of Assembly.

Kwaga said state legislatures were expected to scrutinise government expenditure, ensure allocations were used in accordance with approved budgets and provide checks and balances on the executive.

However, he expressed concern that state legislatures had been considerably weakened since 1999, limiting their ability to exercise independent oversight over governors.

“The entity responsible for ensuring that FAAC is being disbursed or is being used to fund a budget is the state House of Assembly,” he said.

He argued that strengthening the autonomy of state legislatures would provide a more sustainable approach to accountability than creating additional monitoring arrangements.

Kwaga also identified local government autonomy as essential to financial accountability, warning that excessive control by governors over the years continued to undermine federalism and the separation of powers.

On the EFCC’s role, he acknowledged the commission’s powers to investigate corruption allegations but urged it to exercise them professionally and in good faith.

Read also: How states are deploying increased FAAC revenues to drive development

He warned that the monitoring exercise must not become an instrument for targeting political opponents ahead of the 2027 general elections, calling for transparency and public disclosure of its findings.

Kwaga cautioned against concentrating on governors and state officials while overlooking accountability concerns within the federal government, including delays in capital expenditure implementation and weaknesses in public financial management by federal agencies.

Beyond monitoring, Kwaga identified weaknesses in prosecution, particularly the quality of evidence presented in court and delays in the criminal justice system, as major challenges to Nigeria’s anti-corruption efforts.

He called for greater investment in investigative infrastructure, personnel welfare and effective sanctions for public officials who abuse their offices.

Similarly, Danladi Plang, Head of Nigeria Programmes at the International Institute for Democracy and Electoral Assistance, said government institutions at federal and state levels must be allowed to discharge their respective oversight responsibilities.

Plang equally identified state auditors-general and Houses of Assembly as the first line of accountability, stressing that audit reports should be made public to strengthen transparency and provide a basis for investigating financial infractions.

“I think the first line of oversight for me would be those state agencies, so that they should be allowed to play their roles well. If they’re supposed to audit and make their audit reports public, they should do that,” he said.

He maintained that law enforcement agencies should intervene where there were indications of financial crimes rather than assume the responsibilities of institutions constitutionally mandated to oversee state expenditure.

Read also: Tinubu orders EFCC to track FAAC allocations to States, LGs

On concerns about political interference ahead of the 2027 elections, Plang warned against turning anti-corruption agencies into instruments of political persecution, stressing that financial crimes should be investigated regardless of the political season.

Although auditors-general could audit public accounts and submit reports to state assemblies, he noted that they lacked prosecutorial powers, which fell within the remit of law enforcement agencies such as the EFCC.

Plang said the independence and neutrality of anti-corruption agency leadership would be critical to ensuring that influential individuals were not shielded from investigation.

“The moment they decide to split the gallery because somebody appointed them, then of course, you know that they will not bite,” he said.

Alechenu David, Anti-Corruption Lead and Monitoring and Evaluation Officer at the Centre for Democracy and Development-West Africa, questioned the effectiveness of even relying primarily on government agencies to monitor public spending, calling for greater involvement of citizens and civil society organisations.

“One of the biggest responsibilities that should be put on the people is the responsibility of monitoring. And doing it effectively has to be done by taking responses from the citizens,” he said.

David also noted that the EFCC already had responsibilities relating to election financing, vote buying and tracking financial transactions during elections, cautioning that additional monitoring demands could affect its other responsibilities.

He called for stronger coordination among anti-corruption institutions, including the Nigeria Police Force, Code of Conduct Bureau, ICPC, EFCC and Nigerian Financial Intelligence Unit (NFIU), arguing that suspected financial crimes often involved multiple individuals and institutions requiring coordinated investigations and information-sharing.

Read also: Nigeria’s FAAC windfall raises questions over state borrowing

The monitoring initiative represents a shift towards preventive measures in public financial management, with the EFCC seeking to identify vulnerabilities in the handling of government allocations before funds are diverted.

Ola Olukoyede, EFCC chairman, had earlier explained that the FAAC monitoring was part of such measures to prevent financial crimes before public funds were diverted.

He said the commission was moving beyond its traditional emphasis on investigating financial crimes and recovering stolen funds to identifying vulnerabilities in public financial management and preventing the diversion of resources.

Olukoyede also disclosed that the commission had established a Department of Fraud Risk Assessment and Control to examine financial releases and track how public resources were utilised.