About ₦500bn was deducted from the Federation Account Allocation Committee revenue for May 2026 to fund a national security emergency intervention, according to multiple sources familiar with the FAAC proceedings.
The deduction was reportedly made before the monthly revenue-sharing exercise among the Federal Government, states and local government councils.
One of the sources confirmed the development, saying, “FAAC deducted ₦500bn for national security emergency fund this month.”
Another official said the deduction accounted for a major part of the gap between the total revenue generated and the amount eventually distributed to the three tiers of government.
“That is where the FAAC windfall is going too,” the source said.
The official added that commissioners of finance from the 36 states, who are members of FAAC, were aware of the deduction.
“Commissioners are not talking about it, which means they are in the loop,” the official added.
However, an official FAAC allocation document reportedly showed that substantial deductions from federation revenues were disclosed during the May 2026 FAAC meetings.
The document indicated that ₦250bn was set aside for a Military Intervention Fund, while another ₦252bn was allocated as an Infrastructure Development Fund to states. It also showed a ₦450bn deduction to the Non-Oil Excess Revenue Account, bringing the combined value of the three major deductions to ₦952bn.
The revelation came as FAAC announced the distribution of ₦2.3tn to the Federal Government, state governments and the 774 local government councils as revenue allocation for May 2026.
According to a statement issued on Wednesday by the Director of Press and Public Relations in the Office of the Accountant-General of the Federation, Bawa Mokwa, the amount shared represented an increase of ₦43bn from the ₦2.26tn distributed in the previous month.
The allocation marks a 1.9 per cent month-on-month increase and continues the upward trend in federation revenues. The ₦2.257tn shared from April 2026 revenue had exceeded the ₦2.04tn distributed for March revenue by ₦217bn, while the March allocation was ₦150bn higher than the ₦1.89tn shared in February.
The statement said the ₦2.300tn distributable revenue comprised ₦1.611tn in statutory revenue and ₦688.785bn in Value Added Tax revenue.
A communiqué issued after the meeting showed that total gross revenue available in May stood at ₦3.395tn. From this amount, ₦123.546bn was deducted as cost of collection, while ₦971.610bn was set aside for transfers and refunds.
A breakdown of the ₦2.300tn distributable revenue showed that the Federal Government received ₦818.680bn, while state governments received ₦759.141bn.
The 774 local government councils received ₦534.277bn, while oil-producing states shared ₦188.132bn as 13 per cent derivation revenue.
Although the official FAAC communiqué did not provide details of the individual items captured under transfers and refunds, sources said the ₦500bn security deduction formed part of the pre-distribution adjustments made to federation revenue for the month.
The deduction comes amid persistent security challenges across Nigeria, with federal and state governments under pressure to strengthen military, police and intelligence operations.
The country has continued to grapple with insurgency in the North-East, banditry and mass kidnappings in the North-West, farmer-herder clashes in the North-Central, separatist-related violence in the South-East, and crude oil theft and pipeline vandalism in the Niger Delta.
Despite huge annual budgetary allocations to defence and security, attacks on communities, abductions for ransom and assaults on security formations have continued to stretch the nation’s security architecture.
The administration of President Bola Tinubu has repeatedly pledged to prioritise national security, describing it as essential to economic growth and social stability.
Since assuming office in May 2023, the Federal Government has approved increased funding for the armed forces, procured military hardware and intensified intelligence-driven operations against insurgency, banditry and other violent crimes.
Security analysts say the creation of a national security emergency fund, if sustained, could provide additional fiscal support for urgent security interventions as the country battles evolving threats across different regions.
Economists also welcomed the Federal Government’s plan to establish a ₦500bn national security emergency fund but urged authorities to ensure transparent and accountable spending.
In separate interviews, the Chief Executive Officer of Economic Associates, Dr Ayo Teriba, said no Nigerian would oppose increased funding for security, given the obvious funding gaps in troop support, equipment procurement, personnel remuneration, surveillance infrastructure and recruitment of security personnel such as forest guards.
“Everybody agreed that not enough is being done on security, not enough is being spent on security, and the funding gaps on security are obvious,” Teriba said.
He noted that sourcing the fund from FAAC allocations rather than imposing fresh levies on citizens would likely attract support, but added that Nigerians would expect transparency in the management of the resources.
“If the government wants to set aside a security fund, nobody will be opposed to it. They are saying they will take it from FAAC before sharing the money. If they want to sacrifice money that they need for security, that is the only way,” he said.
Teriba stressed that the success of the initiative would depend on the government’s willingness to be transparent.
“It is up to them to reassure Nigerians that this time they mean well and that they can be transparent about what they want to use this funding for,” he added.
He also supported the opposition of the Department of State Services to foreign donations into the proposed security trust fund.
“I am happy that the DSS is saying no foreign funding because some of the insurgents are being funded by some foreign interests. Some foreign countries might be complicit, and you shouldn’t take funding from such,” Teriba said.
Also speaking, a Professor of Economics and Public Policy at the University of Uyo, Prof. Akpan Ekpo, described security as a critical requirement for economic growth and investment.
“Security is very crucial. Without security, all the investments coming in will not work. With security, you can develop a place. Without security, you can’t,” Ekpo said.
He said a dedicated emergency fund to strengthen security operations and procure modern equipment was a step in the right direction, provided the resources were managed efficiently.
