Nigeria saved N15.8trn from petrol subsidy removal in 30 months – Oyedele

The Federal Government mobilised N15.8 trillion in resources for the federation from savings generated by the removal of the petrol subsidy between June 2023 and December 2025, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said.

Oyedele disclosed this on Wednesday at a media conference on the scorecard of the Federal Government’s economic reforms between 2023 and 2026.

According to him, the N15.8 trillion in subsidy savings comprised N5.4 trillion received by the Federal Government, while N10.4 trillion was shared among state and local governments.

He said the savings were reflected through increased revenue collections, particularly as the naira value of dollar-denominated transactions rose following the exchange-rate reforms.

“Between June 2023 and December 2025, subsidy savings mobilised the sum of N15.8 trillion in resources for the federation,” Oyedele said.

The minister added that the Federal Government generated an additional N3.1 trillion in independent revenue during the period, mainly through remittances from government-owned entities.

He said the combination of subsidy savings, incremental independent revenue and additional borrowing brought the Federal Government’s total incremental resources to N20.4 trillion.

“Altogether, the federal government’s incremental resources over the period — subsidy savings, independent revenue, and incremental borrowing — came to N20.4 trillion,” he said.

Oyedele disclosed that the Federal Government obtained N11.9 trillion in additional borrowing during the period, stressing that the figure would have been “far higher and economically destabilising” without the fiscal space created by the reforms.

N30.64trn spent on additional expenditure

The minister said the Federal Government incurred N30.64 trillion in incremental expenditure between June 2023 and December 2025.

Of the amount, N9.39 trillion was spent on wage adjustments, minimum wage increases and allowances for public servants.

Another N9.37 trillion went towards servicing external debt, while N6.5 trillion was allocated to strategic infrastructure.

Oyedele noted that expenditure on higher wages alone exceeded the Federal Government’s entire share of the savings generated from petrol subsidy removal.

“The incremental amount that the federal government spends paying higher wages is more than the entire savings that the federal government earned from subsidy removal,” he said.

He explained that the sharp increase in external debt-servicing costs was largely driven by the depreciation of the naira.

According to him, although the dollar value of Nigeria’s external debt obligations remained unchanged, the amount required in naira to service them increased significantly.

“If we were paying $1 million before in interest on our foreign debt, it is still the same $1 million, but instead of N460, it’s now N1,415,” Oyedele said.

“And I’ve said this before, when you have debt service to pay, you don’t negotiate, you don’t delay, you pay. Because delay or defaults have consequences.”

The minister maintained that the reforms were not primarily introduced to increase government revenue but to tackle what he described as entrenched corruption in Nigeria’s artificially managed fuel subsidy and foreign exchange markets.