There is a strange kind of theatre playing out across Nigeria right now, loud, charged, and deliberately simplistic. The script is familiar. Point to a FAAC figure, shout that governors are now “fat,” and then demand miracles overnight. It is the politics of outrage dressed as arithmetic, a coded verdict that suggests any governor who receives more must automatically deliver more, regardless of context, regardless of reality.
This is judgment by headline, not by evidence. It thrives on selective inquiry, on pulling 2019 numbers beside 2025 numbers and pretending the two eras are the same economy. Whether done consciously, mischievously, carelessly or out of sheer ignorance, the effect is the same: to hang a dog before asking if it barked.
The irony is almost cinematic. The same voices amplifying FAAC figures to indict governors are the same voices on WhatsApp groups and at markets lamenting that their own salaries, though increased, no longer stretch. They feel it in their pockets. A raise that should bring relief instead brings frustration because the naira buys less bread, less fuel, less school fees.
That is precisely the paradox governors are navigating, only at a scale of billions. You cannot demand “do more” from a governor while insisting that your own bigger paycheck has not translated to bigger comfort. The logic cannot bend in one direction for citizens and snap back in another for government.
And here lies the deeper contradiction. It is largely the same opposition that has refused to describe Tinubu’s economic reforms as helpful, that has called them painful, elite-driven, or experimental, that is now turning around to use those very reforms as a yardstick to judge governors. Bigger FAAC, they say, should mean bigger roads and cheaper food. But they will not say bigger FAAC came from subsidy removal and a floated naira, the same policies they criticize. It is applause for the president by the back door, wrapped in condemnation for the governor at the front door.
Political scientists call this cognitive dissonance in public discourse, and economists call it nominal illusion, the mistake of confusing bigger naira figures with bigger real value. John Maynard Keynes warned a century ago that people suffer from “money illusion,” judging prosperity by the face value of currency rather than what it can actually command. That illusion is now national policy debate.
Look at the example making rounds on Niger State platforms. “Gov. Sani Bello, January to June 2019, received ₦27.22 billion with deductions of ₦3.58 billion. Gov. Bago, January to June 2025, received ₦148.02 billion. Source: FAAC and BudgIT. So would you rather be governor then or now?” And then the kicker: “Don’t talk about inflation. Money has increased.” But that is exactly what we must talk about, because money without context is a magic trick.
In 2023, ₦200,000 could still approximate what ₦90,000 to ₦110,000 bought in May 2023. Today it cannot. The reason is not mysterious. Three shocks hit at once. First, fuel subsidy removal. Second, the float and devaluation of the naira. Third, a wave of inflation that peaked above 34 percent in late 2024 before easing to about 15.91 percent headline and 17.52 percent food inflation by June 2026 according to the NBS. Even with that moderation, prices are still climbing 15 to 17 percent every year.
From 2023 to the end of 2024, cumulative inflation erased roughly 70 to 80 percent of purchasing power. The government itself has admitted that the reforms came with “driving up inflation and living costs.”
The exchange rate tells the same brutal story. In May 2023, a dollar traded between ₦460 and ₦750. By 2024 it was ₦1,400 to ₦1,600. By June 2026 it hovered around ₦1,529.71, with S&P forecasting about ₦1,451 by year end. When your import bill triples because the dollar tripled, everything imported follows. Fuel, wheat, fertilizer, machinery, medicines.
Nigeria is still an import-dependent economy, so that shock does not stay at the ports. It walks straight into the market and sits beside tomatoes, crayfish, pepper, yam flour, garri, and beef, the very items the NBS listed as driving food inflation in June 2026. A bag of rice that was ₦35,000 in 2023 now sits between ₦90,000 and ₦110,000. Beans moved from ₦45,000 to about ₦120,000. A yam that sold for ₦2,500 now demands ₦8,000 to ₦12,000. A crate of tomatoes has gone from ₦15,000 to ₦50,000 and ₦80,000. Petrol that was ₦195 now crosses ₦1,230. Transport from Abuja to Jos that cost ₦3,500 now costs ₦12,000 to ₦15,000. Transport costs alone rose 16 percent year on year by April 2026, and fuel spiked again during the Iran conflict. This is not speculation. It is the lived math of households.
The construction site feels it even more. Building is an import and diesel business. Cement that was ₦4,500 per bag is now ₦10,000 to ₦12,000. Iron rods that sold for ₦600,000 per ton now demand ₦1.4 million to ₦1.6 million. Diesel has moved from ₦650 to between ₦1,200 and ₦1,400 per litre. Artisans who charged ₦5,000 daily now ask ₦15,000 to ₦20,000. Contractors are not greedy, they are hedging. They must price in FX risk, generator costs, and inflation expectations above 20 percent. The result is mechanical. A project budgeted at ₦100 million in 2023 now requires ₦220 million to ₦250 million to deliver the same scope. That is not mismanagement. That is macroeconomics.
Wages tell the same painful arithmetic. The minimum wage was ₦30,000 in 2023. It is now ₦70,000. But when inflation hit 34.8 percent in 2024, that raise was swallowed before it landed. Real wages fell. The federal response has been a $3 billion social protection push and cash transfers to 15 million households, yet the IMF still estimates that 63 percent of Nigerians remain in poverty. If a worker’s paycheck must double just to stay in place, then a governor’s budget must more than double just to build the same school, clinic, or road.
This is where theory helps us see clearly. The “Purchasing Power Formula” is simple but unforgiving. Value today equals value in the past divided by one plus inflation over time. Run that with 30 percent average inflation in 2024 and about 16 percent in 2025 to 2026, and ₦100,000 in May 2023 is worth ₦200,000 to ₦220,000 in June 2026.
Nobel laureate Milton Friedman’s famous dictum that “inflation is always and everywhere a monetary phenomenon” meets the Nigerian reality that it is also a fiscal and exchange rate phenomenon. Paul Krugman’s work on cost-push inflation explains why a devaluation and subsidy removal together create a price surge that outruns income growth. And Amartya Sen’s capability approach reminds us that development is not about how much money is announced, but about what people can actually do and be with it. By that measure, the conversation must shift from nominal FAAC to real outcomes.
So why did this happen? The Tinubu administration argues the logic was deliberate. Remove subsidy, unify and float the naira, and allow market prices to reflect true costs. The immediate pain was expected. Officials now point to easing inflation, a more efficient FX market, GDP growth around 11.2 percent, and reserves above $50 billion as early signs. The IMF and World Bank acknowledge the reforms but warn of “adjustment pain” and “high inflation risk squeezing incomes.” That is the honest tension. Pain now for stability later, or pain now with no guarantee of later.
The bottom line is uncomfortable but clear. States are receiving more FAAC in naira terms, sometimes three times more than in 2019. But in real terms, half of that increase has been vaporized by inflation and depreciation. ₦100 million today cannot build what ₦100 million built in 2023. A ₦200,000 salary today feels like ₦90,000 in 2023. Until food inflation and FX settle below 10 percent, both citizens and governments will feel poorer despite bigger numbers on paper.
We cannot, therefore, condemn the federal government for rising costs while simultaneously praising it for bigger allocations and then turning to demonize governors for not performing miracles with those same allocations. That is double standard. Yet the governors are not off the hook. Politics is a mirror. The same governors who rush to credit the president for “record FAAC” must also show, transparently and measurably, what that money is doing in classrooms, hospitals, farms, and roads. To whom much is given, much is expected.
The public may not understand macroeconomics, but they understand a completed borehole, a working primary health center, and food that does not require a second mortgage. In the end, value is not in the allocation. Value is in what the allocation becomes.
Bagudu can be reached via bagudumohammed15197@gmail.com or 07034943575.
