The Federal Government says it spent N30.64tn on additional obligations linked to economic reforms between June 2023 and December 2025, while the removal of petrol subsidy and foreign exchange reforms generated N15.8tn in additional resources for the Federation.
The figures were contained in the Federal Government’s Nigeria Reform Scorecard, titled “The Benefits, Costs and Harm Prevented,” released on Wednesday.
Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, said the N15.8tn was not kept in a separate account labelled “subsidy savings.” Instead, the reforms increased the naira value of revenues accruing to the Federation.
He explained that the unification of the foreign exchange market also contributed to the increased revenue, as government agencies received more naira for dollar-denominated collections.
Of the N15.8tn generated, the Federal Government received N5.4tn, representing 34 per cent. States received N6.5tn, or 41 per cent, while the 774 local government areas received N3.9tn, representing 24 per cent, under the Federation Account allocation formula.
Oyedele said the Federal Government’s total additional resources during the period amounted to N20.4tn. This comprised N5.4tn from subsidy-related savings, N3.1tn in additional independent revenue and N11.9tn from additional borrowing.
Borrowing accounted for 58 per cent of the resources, subsidy savings contributed 27 per cent and other revenue made up 15 per cent.
However, the government’s additional expenditure reached N30.64tn, leaving a gap of about N10.24tn. The government said the shortfall was funded from its existing revenue base.
The largest expenditure items included N9.39tn spent on wage adjustments, including the new minimum wage, wage awards and allowances for public servants.
Another N9.37tn went into additional external debt servicing, largely due to the depreciation of the naira, while N6.47tn was allocated to strategic infrastructure.
Together, the three areas accounted for about N25.22tn, or more than 82 per cent of the total additional expenditure.
Other expenses included N3.14tn in additional electricity subsidy costs, N1.24tn in higher domestic debt servicing, N423.8bn for social welfare transfers and N419.1bn for the Federal Capital Territory, Ecological Fund, Natural Resource Fund and other interventions.
The government also spent N201.26bn to cover the increased naira cost of foreign obligations.
Oyedele said the figures showed that the reforms created significant fiscal space but did not leave the Federal Government with a large pool of idle cash.
He noted that the additional resources were absorbed by rising wages, debt obligations, infrastructure projects and other government responsibilities.
The minister also argued that the foreign exchange reform eliminated what he described as an implicit subsidy that had benefited rent-seekers rather than ordinary Nigerians and manufacturers.
The latest disclosure follows continued public demands for an explanation of what happened to the savings generated after President Bola Tinubu announced the removal of petrol subsidy on May 29, 2023.
Tinubu had said the money previously spent on subsidy would be redirected towards infrastructure, education and other programmes that would benefit Nigerians.
Oyedele said the government’s latest scorecard was intended to provide a detailed account of the resources generated and how they were deployed.
He acknowledged that the reforms had come with significant costs, including higher prices, a sharp adjustment in the value of the naira and increased pressure on households and businesses.
Information and National Orientation Minister, Mohammed Idris, described the subsidy removal as one of the most significant and difficult economic decisions of the Tinubu administration.
He said the reforms were necessary to move resources away from what the government considered an unsustainable subsidy system and redirect them towards investments that could deliver longer-term benefits.
Meanwhile, the Minister of Budget and Economic Planning, Senator Abubakar Atiku Bagudu, said the Tinubu administration inherited an economy with a very low revenue-to-GDP ratio and limited fiscal capacity.
Bagudu said the government therefore had to take difficult decisions to reduce leakages, restore confidence and create more room for spending on security, infrastructure, human capital and grassroots development.
He added that measures had also been introduced to cushion the impact of the reforms on vulnerable Nigerians, while increased government revenues would improve its capacity to meet developmental and constitutional responsibilities.
