The Federal Government of Nigeria has saved approximately N1.45 trillion between June and September from the removal of petrol subsidy, according to FAAC allocation records obtained from the National Bureau of Statistics and Nigeria’s Governors Forum websites.
Monthly contributions to the Non-Oil Revenue (Savings) account totalled N696.93 billion in June, N389.7 billion in July, N71 billion in August, and N289 billion in September.
President Bola Tinubu declared the end of the subsidy in May 2023. Prior to this, the Nigerian National Petroleum Company Limited spent N1.828 trillion on subsidies from January to May 2023, 55 percent higher than the same period in 2022.
Tinubu announced that N1 trillion was saved in June and July alone, which will now be used for intervention programmes benefiting families.
“In a little over two months, we have saved over a trillion Naira that would have been squandered on the unproductive fuel subsidy, which only benefitted smugglers and fraudsters,” he said.
Apparently, Festus Osifo, Trade Union Congress President, questioned the government’s claim of saving N1 trillion after the subsidy removal, urging transparency in utilising the funds.
“The president and commander-in-chief, on his own, came and said the country has saved N1 trillion. The federal government went everywhere to announce that if the subsidy is removed, it’s going to save substantial money,” Osifo said during an interview at the Arise Television News programme.
Osifo expressed that there’s no need for further borrowing and that the government should use part of the saved money for the benefit of Nigerians.
Meanwhile, Mohammed Idris, Minister of Information and National Orientation, acknowledged substantial savings from the subsidy removal and stated that funds were provided to state governments to ease the policy’s impact on citizens. The exact amount wasn’t disclosed.
He said, “So much money has been saved since the removal of the subsidy. Some of the money that has been saved has been given to states.
“Mr. President believes that state governments are closer to the people than federal ones. That is why the administration has been passing funds through the governors to provide palliatives to cushion the effects of the subsidy removal.
“I cannot give the exact figure right now because it is an ongoing exercise.”