Nigeria has failed to meet the United States’ minimum fiscal transparency requirements for the second consecutive year, with Washington faulting the Federal Government over weaknesses in budget reporting, audit independence, procurement disclosure and the transparency of public finances.
The finding is contained in the U.S. Department of State’s **2026 Fiscal Transparency Report**, released Tuesday after an assessment of 139 governments and the Palestinian Authority.
According to the report, 73 governments met the minimum fiscal transparency standards, while 67 failed to do so. Of those that failed, 14 made significant progress during the review period, while 53—including Nigeria—recorded no significant progress.
The assessment covered information collected between January 1 and December 31, 2025, from U.S. Embassy officials in Abuja, other federal agencies, international organisations and civil society groups.
The report comes amid growing concerns in Nigeria over the implementation of federal budgets, particularly as the government continues to deal with overlapping 2024, 2025 and 2026 budget cycles.
Budget documents lack sufficient detail
The State Department said Nigeria’s budget documents failed to provide a substantially complete picture of government revenues and expenditures.
It said the documents did not adequately break down spending to support the activities of executive offices and did not provide sufficient details on revenue sources and government expenditure.
Under the U.S. assessment criteria, a transparent budget should provide information on revenues and expenditures by ministry, identify revenue by source—including oil and non-oil income—and disclose allocations to state-owned enterprises and special accounts.
The report also questioned the credibility of Nigeria’s budget execution, saying actual revenues and expenditures did not reasonably correspond with the figures contained in the enacted budget.
The assessment represents a deterioration from the previous year. In its 2025 report, the U.S. government said Nigeria’s budget documents provided a substantially complete picture of planned revenues and expenditures and were generally reliable.
The latest report further noted that while Nigeria published its enacted budget and end-of-year report online, it failed to publish its executive budget proposal within a reasonable timeframe.
Under the U.S. standard, the proposal should be made public at least one month before the beginning of the fiscal year and before legislative approval, allowing citizens and lawmakers to scrutinise it before passage.
Auditor-General’s office criticised
Nigeria’s supreme audit institution, the Office of the Auditor-General of the Federation, also came under scrutiny.
The U.S. said the institution did not meet international standards for independence and had failed to publish substantive audit reports.
The Auditor-General’s office is expected to audit the executed budget, verify annual financial statements and publish its findings within a reasonable period.
The State Department said that although the audit office had access to the full executed budget, it had not published the necessary reports.
It warned that without an independent audit institution and publicly available audit findings, citizens and lawmakers lacked an important mechanism for holding government accountable.
Procurement, natural-resource contracts remain opaque
The report also identified weaknesses in Nigeria’s disclosure of public procurement information.
According to the U.S., the government did not make accessible information on public procurement contracts available to the public.
On natural-resource extraction, the State Department acknowledged that Nigeria had established legal criteria and procedures for awarding contracts and licences and generally followed the rules in practice.
However, it said key details of concessions—including the geographical area, resource involved, duration and company awarded the contract—were not made public after decisions were taken.
The 2026 assessment also introduced a tougher requirement requiring governments to disclose the terms and conditions of sovereign loans, including liabilities and collateralised assets.
The report noted that Nigeria had made information on debt obligations, including major state-owned enterprise debt, publicly available. However, the department did not assess whether the terms of those loans met the new standard.
Six areas identified for reform
The U.S. government recommended several measures to help Nigeria improve its fiscal transparency.
They include publishing the executive budget proposal online within the required timeframe; providing detailed breakdowns of revenues and expenditures by ministry and source; and clearly identifying spending for executive offices.
Washington also urged Abuja to ensure that actual spending corresponds with approved budgets and that major deviations are properly explained.
Other recommendations include strengthening the independence of the Auditor-General’s office, publishing audit reports and making public procurement contract information easily accessible.
Some progress acknowledged
Despite its overall negative assessment, the State Department recognised areas where Nigeria met basic transparency requirements.
It said Nigeria had made its enacted budget and end-of-year report widely and easily accessible to the public, including online.
The government was also credited with making information on debt obligations, including those of major state-owned enterprises, publicly available.
The report further said Nigeria’s sovereign wealth fund had a sound legal framework and disclosed its funding sources and general approach to withdrawals.
The U.S. government, however, concluded that these measures were insufficient to lift Nigeria above the minimum fiscal transparency threshold.
Presidency: Reforms remain ongoing
Reacting to the report, Special Adviser to the President on Media and Public Communication, Sunday Dare, said fiscal transparency, accountability and effective public financial management remained priorities of the Federal Government.
Dare said Nigeria would continue implementing reforms aimed at improving the management, reporting and disclosure of public resources.
He urged Nigerians to properly contextualise the U.S. assessment, noting that it focused specifically on the State Department’s minimum fiscal transparency requirements and should not be viewed as a comprehensive assessment of all public financial management reforms in the country.
He also pointed to initiatives including the Open Treasury programme, public budget documentation, debt disclosures and public procurement reforms.
According to him, the government is also strengthening digital procurement and other systems designed to improve the accessibility, reliability and timeliness of public financial information.
Dare said the report should serve as an external benchmark for strengthening existing reforms rather than as a complete characterisation of Nigeria’s fiscal governance.
BudgIT backs report
The Country Director of BudgIT, Vahyala Kwaga, agreed with the U.S. assessment, particularly its concerns about budget implementation and the independence of the Auditor-General’s office.
Kwaga said that although the Federal Government’s budget generally provided information on revenue and expenditure composition, reporting on actual implementation remained a major weakness.
He argued that the government had struggled to provide a consolidated account of its spending and earnings, despite Nigeria’s adoption of the International Public Sector Accounting Standards.
Kwaga also criticised the lack of independence of the Auditor-General’s office, saying its investigative powers and personnel management remained insufficiently independent.
He raised further concerns about vague capital expenditure provisions, the inclusion of projects through budget repeal and re-enactment legislation, and limited public disclosure of procurement processes.
He said procurement journals were not consistently made public, while information on bid-opening events and evidence of competitive bidding were often unavailable.
Kwaga added that although debt information was available, necessary debt sustainability analyses had not been published since 2023.
Global picture
Globally, the U.S. assessment found that 73 governments met the minimum fiscal transparency requirements, while 67 did not.
The countries that failed to meet the standards included major economies such as China, Egypt, Saudi Arabia, Pakistan and Ukraine.
Among the 67 countries that failed, 14 made significant progress during the review period. They included Bangladesh, Cameroon, the Central African Republic, Chad, the Dominican Republic, Ecuador, Ethiopia, Laos, Lebanon, Liberia, Libya, Niger, São Tomé and Príncipe, and Senegal.
Nigeria was among 53 countries that recorded no significant progress, alongside Algeria, Angola, Uganda, Tanzania, The Gambia, Guinea, Guinea-Bissau, Mali, Sierra Leone and Togo.
The assessment comes as Nigeria faces renewed scrutiny over controversial provisions in the 2026 budget, including allocations for religious infrastructure, constituency projects, duplicated road and school projects appearing under different agencies, and large lump-sum provisions described as “special presidential interventions” and “miscellaneous.”
The congressionally mandated Fiscal Transparency Report is published annually and is used by Washington to guide engagement with foreign governments and determine eligibility for certain forms of U.S. assistance.
With Nigeria preparing for its 2027 budget cycle, the latest assessment is likely to intensify pressure on the Federal Government to improve the openness, credibility and accountability of its public finances.
Reps’ PFIPC probe stalls as committee fails to sit
Meanwhile, the House of Representatives ad hoc committee investigating the controversial Presidential Foreign Investment Promotion Council, PFIPC, failed to hold its scheduled hearing on Wednesday, August 12, raising fresh questions about the progress of the probe.
The committee had earlier adjourned its proceedings until August 12 and announced plans to invite relevant government agencies and stakeholders.
However, the hearing did not take place, with neither the committee nor its chairman, Yusuf Gagdi, providing an immediate explanation.
The development comes at a critical stage of the investigation. The committee had previously indicated that the August 12 sitting could be its final public hearing before members begin compiling their findings and recommendations.
Controversy over alleged government agency
The controversy centres on the PFIPC, which allegedly operated as a federal government agency despite not having been established by law, executive order or another valid government instrument.
The issue came to public attention following questions over the inclusion of the purported council in the 2026 Appropriation Act, which contained a budgetary provision of about N1.3 billion for the organisation.
The House subsequently constituted a 12-member ad hoc committee, chaired by Gagdi, to investigate how an organisation allegedly lacking a legal foundation was included in the Federal Government’s budget and allowed to operate within government structures.
The investigation later expanded to allegations involving forged government documents, office acquisition, the use of government vehicle number plates and attempts to secure recognition from several ministries, departments and agencies.
Committee uncovers alleged forged documents
One of the major revelations before the committee was the discovery of allegedly forged official documents linked to the purported organisation.
The Accountant-General of the Federation, Shamseldeen Ogunjimi, told lawmakers that his office acted on a letter purportedly originating from the State House when processing a budget code for the council.
He later confirmed that the letter did not originate from the Presidency.
The committee subsequently said it had uncovered about 29 allegedly forged official documents linked to the organisation.
The documents were reportedly traced to institutions including the State House, the Office of the Head of the Civil Service of the Federation, the Office of the Secretary to the Government of the Federation and the Federal Ministry of Finance.
The Head of the Civil Service of the Federation, Didi Esther Walson-Jack, also acknowledged before the panel that sufficient due diligence had not been conducted in considering documents relating to the purported organisation.
Gagdi subsequently described the alleged appointment letter of Adeniyi Adeyemi, who presented himself as the Director-General of the PFIPC, as fake.
Adeyemi’s appearance remains unresolved
A major unresolved issue is the committee’s inability to publicly question Adeyemi.
The panel had earlier directed the Inspector-General of Police to produce him before the committee within 48 hours, saying his testimony was important to resolving outstanding questions about the organisation and the documents associated with it.
The police, however, informed lawmakers that Adeyemi was being held pursuant to a court order and could not be released to appear before the committee without appropriate judicial authorisation.
The latest failure of the committee to sit as scheduled has added further uncertainty to an investigation that has already generated significant public interest and raised broader questions about budgetary controls, institutional due diligence and accountability in Nigeria’s public sector.