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States across the country owe contractors and retirees a combined N1.06tn in outstanding obligations despite receiving record revenue inflows in 2024, according to new data from BudgIT’s 2025 State of States report.

The organisation found that contractor arrears amounted to N434.87bn, while pension and gratuity arrears stood at N626.81bn, bringing total unpaid obligations to N1.06tn. The figures underline persistent fiscal stress at the subnational level, even in a year when federal allocations more than doubled and many states reported higher internal revenues.