The World Bank has warned that Nigeria’s social protection system remains weak, with millions of citizens left without government assistance despite worsening poverty.
In its latest report titled “The State of Social Safety Nets in Nigeria,” the Bank revealed that only 19 percent of Nigerians are covered by social safety net programs, and just 44 percent of total benefits actually reach the poor.
According to the report, about 51 percent of Nigerians, roughly 120 million people, lived in poverty in 2023, up from 84 million in 2019. The Bank said the increase was driven by slow economic growth, high inflation, and the removal of fuel subsidies. Inflation surged to 24.6 percent in 2023 and further to 33.2 percent in 2024, raising the cost of living for millions.
The report stated that about one in four Nigerians remains vulnerable and could fall into poverty when faced with shocks such as rising food prices or job losses. “Addressing this challenge requires well-designed, adequately funded, and efficiently implemented social safety net programs,” it noted.
The World Bank said public spending on social safety nets in Nigeria is among the lowest in the world. In 2021, Nigeria allocated only 0.14 percent of its Gross Domestic Product to social safety nets, compared to a global average of 1.5 percent and 1.1 percent in Sub-Saharan Africa.
The majority of federal spending goes through the National Social Investment Program Agency (NSIPA), which manages schemes such as the Household Uplifting Program and the National Home-Grown School Feeding Programme. However, these programs have faced funding gaps and suspensions, reducing coverage nationwide.
“Existing programs provide inadequate benefits, covering less than 4 percent of poor households’ consumption,” the report stated. The Household Uplifting Program, which reached about 2 million households at its peak, provided monthly transfers of N5,000 per household—roughly 10 percent of poor households’ spending.
The National Home-Grown School Feeding Programme currently covers around 10 million schoolchildren, but each meal costs only seven US cents per child, per day. “The benefits are too small to produce transformative effects,” the Bank added.
It noted that spending is heavily concentrated at the federal level, while states contribute little and operate fragmented initiatives. On average, each state manages safety net activities through 10 different ministries or agencies, leading to duplication and inefficiency.
The report also highlighted that Nigeria depends heavily on donor funding to run its social programs. Between 2015 and 2021, Official Development Assistance accounted for about 60 percent of federal social safety net spending. From 2018 to 2022, donor financing rose to about 147 million dollars annually, with the World Bank providing over 90 percent of this amount.
“This reliance poses the danger of not being able to continue large-scale flagship programs when external funding lapses,” the Bank warned, urging Nigeria to create fiscal space for sustainable financing through its own resources.
According to the report, even when programs reach the poor, benefit distribution remains uneven. “While 56 percent of beneficiaries are poor, only 44 percent of total benefits go to the poor,” the Bank said. The report blamed this on equal benefit amounts given to households regardless of size, meaning larger poor families receive less per person.
The World Bank argued that despite weak performance, Nigeria has the foundation to build a stronger system through the National Social Registry, which holds data on over 85 million individuals. The registry, the largest in Africa, identifies poor and vulnerable households across the country.
“Evidence shows that programs that actively use the Social Registry are more effective at reaching those most in need,” the report noted. The Bank urged the government to make the registry a central platform for all social welfare programs and link it with biometric identification and digital payment systems.
The report recommended that Nigeria use part of the savings from fuel subsidy removal and foreign exchange reforms to fund social protection. The Bank estimates that the country could save up to 5.2 percent of GDP from these reforms. “Allocating just one-fifth of these savings to social safety nets would align Nigeria’s spending with regional averages,” it said.
The World Bank suggested three main reforms: expanding coverage and benefit adequacy, improving spending efficiency, and strengthening institutions for better delivery. It also advised that donor funding should be used to test and scale programs, while government funds should sustain them.
The report added that well-targeted cash transfer programs have shown strong results. Among beneficiaries of the Household Uplifting Program, poverty fell by 4.3 percentage points, and inequality declined by 4.2 points.
The Bank’s simulation further showed that with N500 billion in efficient safety net spending—about 0.2 percent of GDP—Nigeria could lift 3.3 million people out of poverty. Increasing spending to 1.2 percent of GDP could lift nearly 14 million Nigerians.
The report said Nigeria’s economic reforms offer an opportunity to strengthen its social protection system if the government prioritizes efficient spending and proper coordination. It called for better budgeting, transparency, and use of data-driven tools to reach the poorest citizens.
“Investing in social safety nets is not charity; it is an investment in Nigeria’s people and future,” the World Bank said.
