Enugu’s IGR Rises 126% As Lagos Tops Fiscal Performance

Enugu State recorded a 125.91 per cent increase in internally generated revenue (IGR) to N407.76 billion in 2025 from N180.5 billion in the preceding year, emerging as the second-highest revenue-performing state in Nigeria, even as Lagos retained its position as the best-performing state in the according to the 2026 State of States released by BudgIT.

The significant increase in Enugu’s revenue placed it among the states with the strongest revenue growth during the year, alongside Oyo and Gombe, which recorded increases of 112.79 per cent and 111.28 per cent, respectively.

However, BudgIT in the report titled “From Allocation to Impact: Rethinking State Spending Priorities”, noted that the composition of Enugu’s revenue growth raises questions about its sustainability, as non-tax receipts accounted for 90.79 per cent of the absolute increase in the state’s IGR.

Lagos maintained its dominance in revenue generation, recording N1.71 trillion in IGR, representing a 35.67 per cent increase from N1.26 trillion in 2024. The state also secured the first position nationally in the 2026 State of States fiscal performance ranking, supported by its diversified revenue base.

The report assessed the 2025 fiscal performance of 35 states across the country, excluding Rivers State because of the non-publication of its audited financial statements and budget implementation reports.

Evaluates states’ revenue mobilisation capacity, fiscal viability, debt sustainability and expenditure priorities, with increased emphasis on the developmental impact of public spending. According to the report, the assessment methodology was revised to move beyond conventional measures of revenue growth and expenditure volumes to examine how effectively public resources are deployed towards improving citizens’ welfare.

“Stronger revenue mobilisation does not automatically translate into better public service delivery,” BudgIT stated, stressing that the quality, composition and execution of government expenditure remain critical measures of fiscal performance.

Beyond Lagos and Enugu, Oyo and Gombe recorded IGR growth of 112.79 per cent and 111.28 per cent, respectively, while Abia and Akwa Ibom recorded increases of 64.48 per cent and 45.11 per cent.

Kano, the leading IGR-generating state in the North-West, generated N102.6 billion, representing a 35.78 per cent increase over the preceding year. Despite the improvements, the report identified continued dependence on Federation Account Allocation Committee (FAAC) transfers as a major weakness in state finances.

FAAC allocations accounted for approximately 90 per cent of Akwa Ibom’s recurrent revenue, 86.47 per cent in Anambra, 82.90 per cent in Abia and 79.28 per cent in Kano, highlighting the limited progress made by several states towards fiscal independence.

On expenditure, Lagos recorded total spending of N3.16 trillion, representing a 33.24 per cent increase, while Oyo and Enugu recorded increases of 118.71 per cent and 84.80 per cent to N978.64 billion and N880.57 billion, respectively.

The report, however, cautioned that expanding expenditure does not necessarily translate into improved development outcomes, particularly where rising operating costs and debt obligations constrain resources available for critical sectors.

Commenting on the findings, BudgIT’s Head of Research and Policy Advisory, Engr. Adejoke Akinbode, said the expansion in public revenue presents an opportunity for states to accelerate development but must be accompanied by responsible spending.

“The ultimate test of fiscal responsibility is whether public resources are translated into better healthcare, improved education, productive infrastructure and other essential services that directly improve citizens’ lives,” she said.

BudgIT urged state governments to strengthen domestic revenue institutions, improve budget credibility, prioritise high-impact development programmes and ensure that borrowing is channelled towards investments capable of generating sustainable economic and social returns.