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N20,000 monthly transfers can cut poverty, says W’Bank

Published

10 months ago

November 16, 2025

The World Bank has said Nigeria could lift up to 13.9 million people out of poverty if it implements a structured N20,000 monthly cash-transfer system targeted at poor households, warning that the country’s current safety-net programmes are too weak and underfunded to deliver meaningful relief.

The Bretton Woods institution delivered the verdict in a new report titled “The State of Social Safety Nets in Nigeria,” obtained by our correspondent on Friday. It urged an increase from the current disbursement of N5,000.

It said Nigeria’s social safety-net programmes are too poorly funded, weakly targeted, and inefficiently executed to deliver meaningful relief to the more than 100 million citizens living in extreme poverty. This comes after the bank revealed that only 44 per cent of total benefits from government-funded safety-net schemes actually reach poor Nigerians.

In its latest assessment, the bank noted that existing interventions “remain too small, too fragmented and too inefficient to move the needle on poverty,” despite the scale of economic hardship confronting millions of citizens.

“At their present scale and design, social protection programmes are simply not adequate to cushion vulnerable families or reverse the rising poverty trend,” the report stated.

It stressed that the combination of high inflation, shrinking household purchasing power, and limited beneficiary reach has weakened the impact of federal welfare spending.

According to the report, simulations show that expanding transfers to N20,000 per month, backed by stronger targeting and increased funding, “could dramatically reduce both the poverty headcount and the depth of deprivation among Nigeria’s poorest households.”

It added that with the right level of investment and a cleaner delivery system, “Nigeria has the potential to lift 13.9 million people out of poverty, more than double what current programmes can achieve.”

According to the World Bank, simulations using Nigeria Living Standards Survey data show that safety nets could significantly reduce poverty and inequality if spending is increased and benefits reach their intended targets.

The bank examined spending scenarios ranging from N500bn to N2.4tn annually, with benefit levels of N5,000 to N20,000 per household per month. The results were striking. Under a clean, perfectly targeted system with zero leakage, N500bn, roughly Nigeria’s current allocation, could lift 3.3 million people out of poverty and cover nearly 70 per cent of the poor.

With N1.8tn (0.9 per cent of GDP), about 10.6 million Nigerians could be lifted out of poverty, while spending N2.4tn (1.2 per cent of GDP, the LMIC average) could lift 13.9 million people above the poverty line.

The report read, “While the impact of the safety net expenditure in Nigeria is negligible, the low impacts are driven by low and inadequate coverage and inefficient spending. Simulations using the NLSS 2018/19 data show that safety nets can have large impacts on poverty and inequality (measured by the depth of poverty) with larger overall expenditures and with efficient spending going directly to the poor.

“The simulations examine scenarios where the overall expenditures vary from N500bn, a very low scenario comparable to the current allocation, to N2.4tn, an ambitious scenario for Nigeria but one of average expenditures (relative to GDP) in other lower-middle-income countries. The simulations vary in benefit size per household from N5,000 to N20,000 per month. The simulations assume that the budget is spent exclusively on poor people, that is, without any targeting errors, leakage, or administrative and operational costs.

“The coverage is then determined by the data based on the budget and benefit size. Poverty impacts can be very significant even under the relatively low expenditures scenario, when spent efficiently. The simulations show that spending N500bn (about 0.2 per cent of GDP) on the poor, without any inefficiency or leakage, can lift 1.6 per cent (3.3 million people) out of poverty and cover close to 70 per cent of the poor. With higher levels of expenditure on the poor, especially expenditures exceeding N1.8tn (0.9 per cent of GDP), 5 per cent (or 10.6 million people) can be lifted out of poverty. With the lower-middle-income country average expenditures of 1.2 per cent of GDP (N2.4tn) on the poor, Nigeria can lift 13.9 million people out of poverty.”

The bank urged the Federal Government to treat safety-net spending as an investment rather than a temporary palliative. “Scaling up cash transfers, particularly towards the N20,000 benchmark, represents one of the most efficient paths to reducing poverty in Nigeria,” it said, adding that wider coverage, not just higher benefit levels, would ensure more equitable relief for the millions living just below the poverty line.

It noted that while several interventions exist on paper, the impact of Nigeria’s welfare spending “remains negligible,” largely because too few poor households are covered and too much of the current funding leaks to non-poor beneficiaries. The bank urged Nigeria to prioritise wider coverage instead of concentrating large benefits on fewer households.

Its analysis shows that spreading N1tn across all poor households, even with smaller benefits, would lift about six million people out of poverty, compared to 5.8 million if the same amount were spent as N20,000 monthly transfers targeted at only one-third of poor households.

The broader coverage also reduces the depth of poverty more effectively, particularly for the millions of citizens just below the poverty line, who need only minimal support to cross it. The World Bank found that the poorest households, those far below the poverty line, remain untouched even by higher transfer amounts.

Under a perfect targeting system, N1tn spent on the poorest third would reduce poverty severity by 1.5 percentage points, nearly double the impact of randomly distributed transfers, but would have almost zero effect on headcount poverty because the poorest are too deep in deprivation to be lifted out with modest transfers.

Earlier, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, announced that the Federal Government plans to deliver digital cash transfers to 15 million households, estimated at 70 million Nigerians. He said 8.5 million households had already received at least one round of the N25,000 grant, with payments to the remaining 6.5 million expected before the end of the year.

Edun described the intervention as a cornerstone of the government’s strategy to cushion the impact of inflation and subsidy removal, but the World Bank report suggests the programme’s short duration and funding limits may not deliver long-term poverty reduction.

The World Bank concluded that Nigeria’s current safety-net architecture is incapable of driving the government’s poverty-eradication ambition unless urgent reforms are made.

It recommended three immediate steps, “Increase overall spending on safety nets, treating them as investments, not handouts, Expand coverage to reach more of the 100 million extremely poor Nigerians, Improve targeting and raise benefit levels to ensure transfers make a measurable impact.

“Nigeria’s safety nets, at their current funding level and implementation pattern, are too small, too narrow, and too diluted to meaningfully reduce extreme poverty,” the report declared.

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Business

Ogun begins N6bn fund disbursement to 3,855 women groups

Published

4 hours ago

September 24, 2026

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The Ogun State Government, in partnership with the Federal Government and the World Bank, has begun disbursing N6 billion from the Community Investment Fund to 3,855 women affinity groups across four local government areas under the Nigeria for Women Programme Scale-Up.

The intervention is aimed at expanding women-led businesses, strengthening household livelihoods and increasing women’s participation in economic activities.

Speaking at the flag-off ceremony in Ijebu-Ode, Governor Dapo Abiodun, represented by the immediate-past Commissioner for Women Affairs and Social Development, Motunrayo Adeleye, said the fund was designed to enable women to move from subsistence activities to sustainable enterprises.

“Today, we gather not merely to mark the disbursement of a fund, but to celebrate another important step in our deliberate journey of empowering women, strengthening families and expanding opportunities for sustainable livelihoods.

“The beneficiary groups have demonstrated their readiness for the intervention by meeting key programme requirements, including regular participation, savings and internal lending, opening bank accounts and preparing Micro-Investment Plans.”

He disclosed that the women had collectively saved N2.6bn in the past seven months, while loans accessed through the groups had risen to more than N4bn.

According to him, the figures demonstrated the financial discipline, trust and commitment developed by the WAGs.

“These figures are more than statistics; they are compelling evidence of the financial discipline, trust, commitment and readiness that the Women Affinity Groups have developed under the programme,” he said.

The governor clarified that the N6bn CIF was not an outright grant but a sustainable revolving financing facility designed to provide capital for establishing and expanding businesses, creating employment and improving household welfare.

He explained that the intervention was an extension of the Nigeria for Women Project, which commenced in the state in December 2020, following the signing of the project between the World Bank and the Federal Government in 2018.

Abiodun said the parent project established 3,792 WAGs across 1,003 communities in Odeda, Ikenne, Ijebu North-East and Yewa North Local Government Areas.

He added that 368 Ward Facilitators were trained and deployed, while 67,094 women beneficiaries received individual grants in April 2022.

According to him, the Scale-Up phase has expanded to seven local government areas— Ifo, Ado-Odo/Ota, Ijebu-Ode, Sagamu, Abeokuta North, Ipokia and Remo North.

He said 5,394 WAGs had been formed under the scale-up phase, reaching 124,062 women as of September 21, 2026.

“The programme has also covered 3,489 communities, with 664 trained ward facilitators, while about 26 states have visited Ogun to study its model and the World Bank has adopted the state as a training hub,” Abiodun stated.

The governor said the WAG model went beyond providing access to finance, noting that it also incorporated financial literacy, savings, responsible borrowing, collective accountability, business and entrepreneurial skills, gender awareness and life skills.

He added that beneficiaries were also being exposed to opportunities relating to health insurance, climate adaptation, strategic partnerships and National Identification Number enrolment.

“In other words, the programme is building not only businesses, but knowledgeable, financially disciplined and economically resilient women,” he said.

Abiodun reaffirmed his administration’s commitment to providing the policy support and institutional collaboration required to complement the intervention, while appreciating the World Bank, Federal Project Coordinating Unit and other partners for their support.

Also speaking, the Minister of Women Affairs, Hajiya Imaan Sulaiman-Ibrahim, represented by her Special Assistant on Technical Management, Jummaih Idonije, described the initiative as a strategic economic intervention consistent with the Renewed Hope Agenda of President Bola Ahmed Tinubu.

She said expanding women’s economic opportunities remained central to inclusive national development.

The minister commended Ogun State for its leadership in implementing the programme, urging the beneficiaries to sustain the momentum and serve as models to other WAGs across the participating local government areas.

The World Bank Task Team Manager, Michael Ilesanmi, said the programme was helping to bridge financial access gaps for women while strengthening their capacity to withstand economic pressures.

The Commissioner for Finance and Chief Economic Adviser to the Governor and Chairman of the Multi-Sectoral Committee of the NFWP-SU, Dapo Okubadejo, said the intervention underscored the importance of deliberate investment in women.

Okubadejo, who was represented by the Permanent Secretary, Ministry of Women Affairs and Social Development, Adebimpe Obienu, noted that women played significant roles as traders, farmers, processors, artisans, entrepreneurs and community builders.

He commended the World Bank, Federal Ministry of Women Affairs and other stakeholders for their contributions to the implementation of the programme, while acknowledging the support of community leaders in ensuring its acceptance at the grassroots.

Some beneficiaries, including Oyesanya Omotoke of Irede WAG in Sagamu, Ayomide Ogunleye of Ifeoluwa WAG in Ijebu-Ode and Adesola Teriba, Chairperson of Success WAG in Abeokuta North, expressed appreciation for the intervention.

They said the fund would help women strengthen their businesses and improve their livelihoods, while commending the WAG model for promoting savings, internal lending, financial discipline and collective responsibility.

Source: punchng.com

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Business

Shipowners urge Dangote to support local fleet

Published

4 hours ago

September 24, 2026

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Indigenous shipowners have called on major cargo owners, including the Dangote Group, among others, to support local fleet development by offering long-term Contracts of Affreightment for petroleum products, cement, fertiliser and other bulk cargoes.

The shipowners said cargo is the foundation of shipping, and predictable cargo contracts are what make vessel financing and acquisition possible.

The call was made by a former Nigeria Chapter President of the African Shipowners Association and Group Managing Director of Seamate Maritime Integrated Services Limited, Capt. Ladi Olubowale, at a Public-Private Dialogue with CEOs organised by the Nigerian Chamber of Shipping in Lagos recently.

The dialogue, themed ‘Unlocking efficiency in the marine and blue economy value chain’, brought together industry stakeholders, including Mr Edwin Devakumar, Group Vice President of Dangote Group (Oil and Gas), as guest CEO.

Olubowale explained that Nigeria’s maritime strategy must move beyond debates about vessel ownership to “creating commercial conditions that make indigenous vessel acquisition bankable.”

“Give credible Nigerian shipowners long-term Contracts of Affreightment, and those contracts become the commercial foundation upon which vessels can be financed, acquired and deployed,” Olubowale said.

Olubowale argued that shipping is capital-intensive and Nigerian owners cannot sustainably acquire large vessels without guaranteed cargo volumes and bankable employment contracts.

He said Dangote, with its refinery, cement and fertiliser operations generating huge maritime cargo volumes, is well placed to catalyse local fleet growth by allocating portions of its cargo requirements to qualified indigenous operators under multi-year CoAs.

Such contracts, he noted, would enable Nigerian shipowners to approach banks, development finance institutions, export credit agencies and international financiers with identifiable cargo and predictable revenue.

Olubowale also raised concern over the dominance of foreign-controlled vessels in lifting Nigerian crude from terminals at Forcados, Bonny and Escravos, earning huge freight revenues from Nigerian cargo.

He said the policy question should be how to convert the movement of Nigerian cargo into domestic assets, jobs, technical capacity and long-term economic value.

“There is no structural reason why Nigerian companies should not ultimately own and operate Suezmax tankers and other large commercial vessels. But fleet development must be connected to cargo, finance, technical capability and long-term employment,” he said.

He advocated a four-pillar model for fleet development — Cargo, Contract, Finance and Vessel — where cargo owners provide volumes, CoAs create bankable contracts, financiers fund vessel acquisition, and Nigerian owners provide vessels and services.

According to him, the model would complement, not replace, government interventions like the Cabotage Vessel Financing Fund.

Olubowale stressed that the government’s role should be that of enabler, regulator and facilitator, while the private sector drives the commercial engine.

“Nigeria’s ambition to build a globally competitive marine and blue economy will require deeper collaboration between cargo owners, indigenous shipowners, banks, investors, ports regulators and government,” he said.

He added that as intra-African trade grows under the African Continental Free Trade Area, maritime transport will become even more critical, and Nigeria must deliberately use its huge cargo base to build a sustainable indigenous shipping industry.

“The maritime industry must ultimately be driven by the private sector. If we connect Nigerian cargo to Nigerian maritime capacity, we will not merely acquire ships — we will build a sustainable shipping industry,” he said.

Source: punchng.com

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Business

Electricity subsidy may hit N2tn amid tariff freeze

Published

4 hours ago

September 24, 2026

Newsbreak365_Admin

The Federal Government may spend about N2 trillion to subsidise electricity this year as it maintains its position against an immediate increase in electricity tariffs.

The Minister of Power, Joseph Tegbe, disclosed the government’s position on electricity tariffs at a media parley in Abuja on Monday while marking his first 100 days in office.

“There are no immediate plans to increase electricity tariffs. Our goal is to build a commercially viable power sector while protecting vulnerable consumers,” Tegbe said.

The minister’s position comes against the backdrop of the N1.93tn electricity subsidy incurred by the Federal Government in 2025, according to the Nigerian Electricity Regulatory Commission’s 2025 Annual Report.

NERC said the subsidy obligation represented 57.44 per cent of the total Nigerian Bulk Electricity Trading invoice during the year and averaged N160.69bn monthly.

The commission said the government incurred the subsidy because allowed electricity tariffs remained below cost-reflective levels, with the Federal Government covering the resulting gap.

“In the absence of cost-reflective tariffs, the government undertakes to cover the resultant gap (between the cost-reflective and allowed tariff) in the form of tariff subsidies.

“It is important to note that due to the absence of cost-reflective tariffs across all DisCos, the government incurred a subsidy obligation of N1.93tn (57.44 per cent of total NBET invoice) during the year,” the commission said.

With the government maintaining that there are no immediate plans to increase tariffs, the subsidy burden could remain around the N2tn level this year. The subsidy burden neared N2tn in 2024 and 2025 despite the Band A to E tariff categorisation introduced in 2024.

Aside from Band A customers who pay the real cost of electricity, customers on other bands still enjoy government subsidies, which are now close to N2tn.

Earlier, electricity generation companies questioned the effectiveness of the Federal Government’s N4tn Presidential Power Sector Debt Reduction Programme, warning that fresh liabilities estimated at over N7tn could accumulate before the programme is fully implemented.

The power producers, under the aegis of the Association of Power Generation Companies, said that while they were not opposed to the Federal Government’s plan to raise bonds to settle outstanding obligations, the initiative would not provide a lasting solution to the liquidity crisis in the Nigerian Electricity Supply Industry because debts continue to accumulate monthly.

“Every month, the DisCos are not paying 100 per cent. NBET is not paying 100 per cent. The N4tn legacy debt is until December 2024. So, how about the accumulation for 2025? And what is already accumulated for 2026? So by the time you finish issuing this N4tn bond over seven years, by 2033, two times what you’re going to pay would have accumulated. So what is your plan?” the APGC Chief Executive, Joy Ogaji, asked the question.

Ogaji also called on the Federal Government to adopt a more sustainable approach to electricity subsidies, arguing that the current subsidy arrangement exists largely on paper because there is no corresponding budgetary provision.

“One of the sustainable ways is for the Federal Government to acknowledge the fact that they cannot subsidise the power market. Because you can see it’s only on paper that the government is subsidising power. It’s not in the budget.

“There is no monetary provision anywhere for subsidies, not even in the supplementary budget; it’s nowhere. It’s just being. You said you would pay. We have not seen it,” she stressed.

The CEO proposed that the government should clearly define the level of subsidy it could afford and make budgetary provisions for it instead of maintaining a blanket subsidy policy that has contributed to mounting debts across the electricity value chain.

Speaking on Monday, the minister said the administration was working to address the sector’s long-standing debt, revenue leakages, metering gaps and infrastructure constraints.

He said his first 100 days, covering June 8 to September 16, had largely focused on diagnosing the problems across the electricity value chain, stabilising existing infrastructure and restoring market discipline.

According to him, gas supply to power plants was constrained by damaged pipelines and commercial conditions that discouraged investment, while ageing equipment, deferred maintenance and stalled projects prevented available capacity from reaching consumers.

He said the sector was also weakened by poor payment discipline, with generation companies receiving only 27 per cent of their bills.

“When President Bola Tinubu entrusted me with the responsibility of serving as Minister of Power, I made four promises to Nigerians. I promised a disciplined approach to solving the sector’s problems. I promised to pursue grid stability through structured, strategic reforms. I promised visible incremental improvements.

“Upon assuming office, the diagnosis we undertook at the onset revealed constraints at every segment of the electricity value chain. Gas supply to power stations was limited by damaged pipelines and commercial terms that discouraged investment.

“Our generation fleet was heavily dependent on thermal plants, with ageing equipment, deferred maintenance, stalled projects, and capacity unable to reach consumers. The sector diagnosis revealed payment of only 27 per cent of generation companies’ bills, undermining their ability to maintain plants and pay gas suppliers,” Tegbe stated.

The minister said transmission infrastructure was similarly under pressure from vandalised towers and lines, overstretched equipment and frequent system tripping.

NERC explained in its 2025 report that, under the subsidy regime, the government covers the gap between the cost-reflective and allowed tariffs through tariff subsidies.

The regulator said the subsidy is applied to the generation cost payable by DisCos to NBET, while the portion of generation costs not covered by the DisCos is invoiced to the Federal Ministry of Finance for settlement.

It said the framework was introduced partly to prevent unpaid subsidy debts from accumulating on the balance sheets of DisCos and limiting their ability to raise finance for critical investments in their networks.

The N1.93tn subsidy obligation recorded in 2025 highlights the financial cost of keeping electricity tariffs below the cost of supplying power.

For 2026, the government’s decision not to immediately raise tariffs means it will continue to bear a significant portion of the cost of electricity while efforts are made to improve collections, infrastructure, gas supply and service delivery.

Source: punchng.com

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