Ekiti Got Minus ₦6.7 Billion in January: The States Losing FAAC Money Before It Lands

In January 2026, Ekiti State's FAAC line showed something you rarely see: a negative number.

Ekiti's gross allocation that month was ₦15.57 billion. After deductions, the "Total Net Amount" was minus ₦6.69 billion. A single line called "Other Deductions" took ₦21.21 billion, more than the state's entire allocation for the month.

Ekiti isn't the only one. We went through 10 months of FAAC data (September 2025 to July 2026) and added up what was taken out of each state's allocation before the money reached the state.

The big picture: ₦832 billion deducted at source

From September 2025 to July 2026, the 36 states were allocated ₦8.75 trillion (gross). ₦831.7 billion was deducted at source:

Type of deduction	10-month total
External debt service	₦343.1bn
Other deductions	₦239.2bn
VAT deduction (Lagos only)	₦93.6bn
Contractual obligations (ISPO)	₦94.6bn

ISPO means "Irrevocable Standing Payment Orders," a state's promise that a lender or contractor can be paid straight from its FAAC money.

These deductions are not "missing" money. They pay off loans and bills the states themselves signed up for. But they show how much of a state's monthly allocation is already spent before it arrives.

The states that lose the most

Here are the states with the biggest share of their FAAC money deducted at source:

Rank	State	Gross allocation	Deducted	% deducted
1	Ekiti	₦157.6bn	₦44.0bn	27.9%
2	Kaduna	₦221.9bn	₦56.1bn	25.3%
3	Bauchi	₦197.7bn	₦46.8bn	23.7%
4	Cross River	₦167.7bn	₦39.1bn	23.3%
5	Lagos	₦760.8bn	₦173.3bn	22.8%
6	Ogun	₦171.5bn	₦37.3bn	21.8%
7	Gombe	₦161.8bn	₦24.2bn	14.9%
8	Edo	₦209.4bn	₦29.3bn	14.0%
9	Osun	₦164.9bn	₦19.1bn	11.6%
10	Katsina	₦211.9bn	₦23.8bn	11.2%

And the states that lose the least:

State	% deducted
Jigawa	1.8%
Nasarawa	2.0%
Anambra	2.4%
Bayelsa	2.4%
Akwa Ibom	2.5%

Four stories inside the numbers

1. Ekiti: one month that wiped out the allocation

In most months, Ekiti's "Other Deductions" was about ₦1.2 billion. In January 2026 it jumped to ₦21.2 billion. The FAAC table doesn't say what it was for. Without that one month, Ekiti would still be in the top 10, but nowhere near the top.

2. Kaduna: the cost of old dollar loans

Kaduna had ₦51.2 billion deducted for external debt in 10 months, almost half (48%) of its statutory allocation. In February 2026, Kaduna's net statutory allocation went negative (minus ₦1.68 billion), because the external debt deduction (₦8.29bn) was bigger than the statutory share (₦7.25bn).

If you read our post on states switching to dollar debt, this is what it looks like in practice. Kaduna owes about 92% of its debt in dollars, and the FAAC deductions are where that debt gets paid.

3. Lagos: ₦173 billion off the top, and still number one

Lagos had the biggest naira deduction of any state: ₦173.3 billion.

• ₦79.2 billion for external debt (₦8.34bn a month since March 2026)

• ₦93.6 billion labelled "VAT Deduction". Lagos is the only state with this line, at about ₦9.9bn a month in 2026.

In February 2026, Lagos's net statutory allocation was minus ₦2.50 billion. Debt service took more than its statutory share. Lagos only stays comfortable because its VAT is so large (₦111 billion gross that month).

4. Bauchi, Cross River and Gombe: the ISPO states

Some states lose more to contractual obligations (ISPO) than to debt:

• Bauchi: ₦16.3bn

• Gombe: ₦11.9bn

• Cross River: ₦11.7bn

• Katsina: ₦8.5bn

These are usually contractor or project payments the state has signed off to be paid directly from FAAC. They aren't bad in themselves, but they lock in future revenue.

What this means for residents

A state's FAAC "headline" figure can be very different from what it can actually spend. Ekiti's net allocation over 10 months was ₦113.6 billion, the lowest of all 36 states, even though its gross allocation (₦157.6bn) wasn't the lowest.

Questions to ask your state government:

1. What is the "Other Deductions" line for, and when does it end?

2. How much of next year's FAAC money is already committed to ISPOs?

3. With more dollar loans being taken, what happens to deductions if the naira weakens?

Final takeaway

In 10 months, ₦832 billion of state FAAC money was spent before it arrived. For Ekiti, Kaduna, Bauchi, Cross River, Lagos and Ogun, it was more than one naira in every five. And at least three times (Ekiti in January, Kaduna and Lagos in February), deductions were bigger than the statutory share itself.

Data source: OAGF FAAC disbursement tables (Table III, State Governments), September 2025 to July 2026, as reported by the NBS. December 2025 was not in the data set we reviewed. "% deducted" = (external debt + ISPO + other deductions + VAT deduction) ÷ total gross allocation. Gross includes statutory allocation, 13% derivation, VAT, ecology, augmentation, EMTL, exchange gain and solid minerals where paid. If you spot an error, tell us and we'll correct it.