Bauchi Central senator Abdul Ningi on Thursday raised pressing questions about the federal government’s handling of proceeds from the removal of the fuel subsidy, during a Senate Committee on Appropriations session.
The senator’s inquiry has brought to the forefront growing concerns about accountability and transparency in managing funds intended for critical economic development.
When President Bola Tinubu announced the removal of the fuel subsidy on May 29, 2023, he framed it as a necessary step to save funds for reinvestment into critical sectors such as education, healthcare, and infrastructure. However, months later, the government has yet to provide a clear account of how the funds have been utilized.
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“We haven’t heard from the minister how much has been saved from the removal of fuel subsidy and how much has been expended,” Senator Ningi lamented.
The senator’s remarks echo widespread frustration, as the removal of the subsidy, alongside the floating of the naira, has contributed to severe economic hardship for Nigerians. Rising costs of goods and services have fueled protests and demands for policy reversals. Despite these challenges, the government has maintained that the policies will bring long-term benefits—a promise that now appears increasingly hollow to many citizens.
During the inquiry, Finance Minister Wale Edun requested a private, closed-door session to address the senator’s questions.
“Are we in a closed-door session? If we are not in a closed-door session, I will humbly seek for that for detailed explanations on the questions asked,” Edun pleaded.
However, this request has fueled speculation that the government might have something to hide regarding the funds realized from the subsidy removal. Critics have drawn parallels to the past, such as the handling of Nigeria’s Excess Crude Account (ECA).
Lessons from the Excess Crude Account
The ECA, created in 2004 under former President Olusegun Obasanjo, was designed as a savings account for proceeds from excess crude oil sales. It served as a buffer for the nation’s economy, especially during times of fiscal difficulty.
Given this history, many expected the Tinubu administration to establish a similar account to manage funds saved from the removal of the fuel subsidy. It is believed that such an account would have provided transparency and ensured that the proceeds were channeled toward the promised development of critical sectors.
However, the absence of a dedicated fund or transparent framework has heightened concerns about the potential misuse of the subsidy savings.
Debt Servicing and Budget Performance Under Scrutiny
Senator Ningi also raised questions about Nigeria’s rising debt profile and the government’s capacity to implement the 2024 budget effectively.
“How much have we actually used to service our debt in 2024? How much are we expecting to service the debt in 2025?” he asked.
He further criticized the poor performance of the 2024 budget, particularly regarding capital projects. With the extension of the capital component of the budget to June 30, 2025, the senator demanded assurances that implementation would improve.
“Will the minister of finance guarantee that the extension of the capital component of the 2024 budget to June 30, 2025, will give the desired results in terms of implementation that has a very low percentage now?” he asked.
Public Skepticism and Growing Distrust
Against the backdrop of a lack of transparency in managing fuel subsidy proceeds, public skepticism about the government’s fiscal policies has deepened. Many Nigerians believe the administration is failing to deliver on its promises and worry that the savings from the subsidy removal may not be utilized as pledged.
The controversy surrounding the closed-door session request adds to concerns that the government’s economic management lacks openness. With mounting economic challenges, the public awaits answers about the fate of the fuel subsidy savings and the government’s broader fiscal strategy as the Senate continues its budget defense sessions.