The Federal Government has announced plans to publish a detailed account of how savings generated from the removal of fuel subsidy have been utilised, amid growing public concern over the impact of the economic reforms.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Wednesday while speaking at the African Emerging Markets Forum in Abuja.
Oyedele explained that savings from the removal of fuel subsidies and reforms in the foreign exchange market have largely been offset by rising debt-servicing obligations and increased government expenditure, as the administration continues to defend reforms widely blamed for worsening living conditions.
According to him, fuel subsidies and what he described as an implicit foreign exchange subsidy previously cost Nigeria about five per cent of its Gross Domestic Product (GDP) before they were removed.
He said a significant portion of the savings had been absorbed by higher debt-servicing costs, noting that borrowing rates had risen to as much as 24 per cent from about eight per cent before the reforms.
The minister also disclosed that the government’s wage bill had nearly doubled following the increase in the national minimum wage to ₦70,000 per month.
He added that the government had expanded funding for its student loan programme, which currently provides tuition support and monthly stipends to more than 1.5 million students.
Responding to concerns over the utilisation of the subsidy savings, Oyedele acknowledged that Nigerians were justified in demanding accountability.
“I’ve heard this question so many times, and guess what? It’s a valid question,” Oyedele said.
The minister also disagreed with a recent assessment by the International Monetary Fund (IMF) that millions of Nigerians remain in poverty despite reforms that have been welcomed by investors.
He argued that a temporary decline in real incomes was an inevitable consequence of removing longstanding subsidies but maintained that the reforms would deliver long-term economic benefits.
Oyedele said the government would measure the success of its reforms using broader indicators, including multidimensional poverty, real per capita income growth and income inequality, rather than relying solely on headline GDP growth.
