Anambra State has emerged as Nigeria’s best-performing state in the 2025 Fiscal Performance Ranking, according to BudgIT’s State of States report released on Tuesday. Lagos, Kwara, Abia, and Edo completed the top five, while Cross River fell sharply from fifth in 2024 to 30th in 2025.
Rivers State, previously a consistent top-five performer, was excluded from this year’s rankings due to a state of emergency that prevented the release of audited financial data. BudgIT marked this year’s report as the 10th edition of its subnational fiscal analysis, highlighting trends in governance and fiscal sustainability across Nigeria’s 36 states.
The report noted notable movements in the 2025 rankings. “Anambra rose from second to first, Lagos held second place, Kwara climbed to third, Edo entered the top five, and Abia, previously outside the top 10, now ranks fourth,” BudgIT stated. Other improvements included Akwa Ibom, up 17 places to 10th, and Zamfara, up nine places to 17th.
At the lower end, Imo, Kogi, Jigawa, Benue, and Yobe occupied the bottom positions. The ranking methodology relied on five indices assessing states’ revenue sufficiency, growth, total expense coverage, debt sustainability, and prioritisation of capital over recurrent expenditure.
On revenue performance, Enugu now leads with an Internally Generated Revenue (IGR) to operating expense ratio of 146.68%, while Lagos maintains 120.87%. Only five states—Abia, Anambra, Kwara, Ogun, and Edo—generated sufficient IGR to cover at least half of their operating costs, down from six in 2024. Fourteen states require over five times their IGR to meet expenditures.
In capital expenditure, Abia led with 77.05% of its total expenditure devoted to capital projects, followed by Anambra, Enugu, Ebonyi, and Taraba, each allocating over 70%. Overall, 24 states spent at least half their budgets on capital projects, while several, including Bauchi and Ogun, spent over 60% on personnel and overhead.
Total recurrent revenue across the 35 states rose from N6.6 trillion in 2022 to N14.4 trillion in 2024, a 66.28% increase. Lagos contributed N1.93 trillion in 2024, accounting for 13.42% of total revenue. Gross FAAC transfers rose by 110.74% to N11.38 trillion, with states such as Oyo, Delta, and Anambra recording over 600% growth between 2015 and 2024. Despite this, 28 states still relied on FAAC for at least 55% of their revenue.
Subnational debt increased modestly from N9.89 trillion in 2023 to N10.57 trillion in 2024, with Lagos, Kaduna, Edo, Ogun, and Bauchi holding 50.32% of total debt. Encouragingly, 31 states reduced domestic debt by at least N10 billion, while foreign debt fell by over $200 million.
BudgIT also highlighted gaps in social spending. Only 66.9% of education budgets were implemented, with per capita spending averaging N6,981. Health budgets achieved 61.9% execution, with per capita spending averaging N3,483. Only a handful of states exceeded N10,000 per capita for education or N5,000 for health.
Vahyala Kwaga, BudgIT’s Group Head of Research, stressed the need for reform: “Fiscal sustainability requires states to improve revenue systems, cut waste, and prioritise infrastructure and human development investments that deliver long-term value.” The report underscores persistent imbalances despite overall growth across states.
