Public sector reform rarely makes headlines. Budgets are written, accounts reconciled, reporting templates updated, and few outside government notice. Yet it is often these quiet administrative changes, rather than grand announcements, that determine whether public money ultimately translates into functioning schools, stocked clinics and better public services.
That reality is now playing out across Nigeria, where a series of public financial management reforms supported by the Partnership for Agile Governance and Climate Engagement (PACE) has helped states unlock US$27 million in performance-based financing under the World Bank’s US$500 million Human Capital Opportunities for Prosperity and Equity Governance (HOPE-Gov) Programme.
The achievement is more than a funding story. It is a case study in how improvements in budgeting, fiscal transparency and local government financial management can create tangible fiscal rewards while strengthening the machinery of government itself.
Launched by the Federal Government of Nigeria and the World Bank in December 2024, HOPE-Gov was designed around a simple premise: states that demonstrate measurable improvements in governance systems qualify for performance-based financing. Rather than rewarding expenditure alone, the programme incentivises reforms in budget planning, fiscal transparency, human resource management and public financial management, particularly in sectors critical to human development, such as primary healthcare and basic education.
Preliminary findings from the independent Year Zero verification suggest the approach is already yielding results. States that met key governance benchmarks have unlocked a combined US$27 million, reflecting progress in areas ranging from budget planning and coordinated annual work planning to fiscal transparency and local government budgeting.
At the heart of many of these reforms is PACE, which has built on the institutional legacy of the Partnership to Engage, Reform and Learn (PERL) and worked alongside the Partnership for Learning for All in Nigeria (PLANE) to strengthen the systems underpinning public financial management and improve educational outcomes in the States.
Its work in Kaduna, Kano and Jigawa focused not on headline-grabbing projects but on the foundations of government performance: improving the links between policy, planning and budgeting; strengthening budget preparation processes; aligning local government budgets with Nigeria’s National Chart of Accounts (NCoA); and enhancing fiscal transparency through an improved Citizens’ Budget framework.
These reforms may sound technical, but their implications are profound.
Across developing economies, weak public financial management systems are often as significant a constraint on service delivery as inadequate funding. The World Bank and other international institutions have long argued that countries achieve better development outcomes when public resources are allocated through credible budgets, linked to policy priorities, and supported by transparent reporting and accountability mechanisms.
For Kaduna, Kano and Jigawa, stronger financial systems matter because the sums involved are already substantial.
Kaduna proposed ₦115.4 billion for education and ₦71.6 billion for health in its 2024 budget. Kano allocated ₦168.4 billion to education and ₦90.6 billion to health in its 2025 budget. At that scale, even modest improvements in planning, allocation and expenditure management can have outsized effects on public service delivery.
Viewed from that perspective, the value of HOPE-Gov extends well beyond the additional financing it provides. The programme rewards states for building systems that improve how they use the far larger domestic resources already flowing into education and healthcare.
The Year Zero assessment illustrates this dynamic. It confirmed that Bayelsa, Borno, Kano, Kebbi and Yobe qualified for a combined US$15 million under Disbursement Linked Results (DLRs) 2.1 and 2.2 for strengthening budget planning and coordinated annual work planning. Additional states qualified through improvements in fiscal transparency and local government budgeting, bringing total disbursements to US$27 million.
One of the most significant contributors to this outcome was PACE’s enhanced Citizens’ Budget Framework.
Sixteen states qualified for US$500,000 each by meeting fiscal transparency requirements, unlocking a further US$8 million, nearly one-third of the total Year Zero disbursement. Yet the importance of the framework lies not only in the financing it attracted. By making budget information more accessible and understandable to citizens, it strengthened the transparency and accountability that are increasingly recognised as essential ingredients of effective government.
The reforms at local government level may prove even more consequential over time.
Across Kaduna, Kano and Jigawa, all 94 Local Government Areas prepared and published their 2026 budgets using the National Chart of Accounts. The introduction of a common budgeting framework has improved consistency, comparability and transparency in local government finances while helping states satisfy key World Bank disbursement requirements.
More importantly, it has laid the groundwork for stronger local planning and resource allocation in sectors that directly affect citizens’ lives.
PACE’s influence has also extended beyond its core focus states.
Working through the Nigeria Governors’ Forum (NGF), the programme disseminated practical reform tools, templates and methodologies that were subsequently adopted and adapted across the federation. Its Local Government Budgeting and Reporting Toolkit, distributed nationwide through the Association of Local Governments of Nigeria (ALGON), provided all 774 local government areas with practical guidance on implementing the National Chart of Accounts and improving budget transparency.
The widespread uptake of these tools helps explain why many states that qualified for HOPE-Gov financing were able to do so using approaches originally developed and tested through PACE-supported reforms.
That broader adoption points to an important lesson. Successful governance reform is rarely about creating entirely new systems. More often, it involves demonstrating workable solutions, refining them through practice and creating pathways for scale.
The early results from HOPE-Gov suggest that this model is beginning to take hold. While the US$27 million unlocked so far is significant, its lasting importance may lie elsewhere: in stronger institutions, more transparent budgeting processes and better financial management systems capable of delivering greater value from every naira spent.
For states grappling with rising service delivery demands and constrained fiscal space, that may prove the most valuable dividend of all. The real prize is not the money earned through reform. It is the capacity to govern public resources more effectively long after the incentives have been paid.