Senator: Fuel Subsidy Removal Saves Nigeria N10 Trillion Annually
Nigeria is now saving over N10 trillion annually following the removal of the fuel subsidy, according to a senior lawmaker. Senator Solomon Adeola, Chairman of the Senate Committee on Appropriations, disclosed the figure, stating the policy has eased significant fiscal pressure on the nation.
Speaking in Ogun State, Senator Adeola, who represents Ogun West, described the former subsidy regime as a “cankerworm” that benefited very few Nigerians at the detriment of the overall population. He drew from his experience as former chairman of the Senate Committee on Finance, noting the government previously borrowed between N6 trillion and N7 trillion yearly to fund the subsidy. The removal, he argued, has eliminated this long-standing drain on public finances.
Officially enacted in May 2023 after President Bola Tinubu’s inauguration, the policy aimed to reduce budget deficits, curb financial leakages, and free resources for critical national investments. While the move has triggered higher fuel prices and inflation, prompting reactions from labour unions and civil society similar to the varied reactions trail Nnamdi Kanu’s legal developments, the administration maintains the savings are being redirected to infrastructure.
Senator Adeola asserted the savings are fueling extensive infrastructural renewal. He highlighted projects like the Lagos-Calabar Coastal Highway and the Sokoto-Badagry Super Highway, which will feature approximately 66 dams upon completion. “The President is creating a new Nigeria,” Adeola stated, framing these projects as foundational to long-term growth. This focus on development comes amidst broader national security and economic efforts, including responses to incidents like the midnight attack Sokoto residents experienced, underscoring the government’s multifaceted challenges.
The presidency corroborated the scale of savings in 2024, with Special Adviser Sunday Dare stating $7.5 billion is now saved annually. These funds are part of a broader economic strategy, such as the Accelerated Stabilization and Advancement Plan (ASAP), aiming to bolster sectors including transportation, where airlines like Overland Airways resumes operations, and commerce, akin to strategic moves when a brand like Pele’s brand acquired new ownership. The government envisions these savings enabling partnerships and investments that stimulate the economy, not unlike a strategic Uba partners Cig collaboration in the financial sector.
Despite the economic rationale, the policy remains a subject of public debate, balancing immediate hardships against promised future gains from reinvested subsidy savings.
