Breakdown on how Nigeria govment spend di N15.8 trillion-naira saved from fuel subsidy removal

Nigeria minister of finance Taiwo Oyedele don release breakdown on di money wey dem generate from di petrol subsidy removal.

Oyedele tok say dem generate N15.8 trillion from di subsidy between June 2023 and December 2025.

Di minister give di breakdown on Wednesday during one media conference on Nigeria reform scorecard from 2023 to 2026, afta calls from different quarters wey ask di govment to explain how dem take di money.

Di minister of finance bin earlier don assure Nigerians say dem go submit detailed report on how di money take waka.

"Between June 2023 and December 2025, subsidy savings mobilise N15.8 trillion for di federation," Oyedele tok.

Di minister of finance tok say di federal govment collect N5.4 trillion from di N15.8 trillion, while states and local govment share N10.4 trillion.

Also, di federal govment generate additional N3.1 trillion from independent revenue, mainly from remittances from govment bodies.

Oyedele tok say di federal govment total resource wey di Tinubu administration get from subsidy savings, independent revenue, and borrowing amount to N20.4 trillion.

"All togeda, federal govment resource ova di period — subsidy savings, independent revenue, and borrowing — na N20.4 trillion," e tok.

Oyedele tok say dem borrow N11.9 trillion extra between June 2023 and December 2025.

"Pipo go tok say, you tok say you don pass your revenue, why you still dey borrow? Oyedele tok.

"Di additional borrowing wey federal government do for dat time, June 2023 to December 2025, na N11.9 trillion," e tok.

Di minister tok say federal govment don spend N30.64 trillion for extra expenses during di same period.

How Nigeria govment spend di money dem see from fuel subsidy removal

Federal govment N5.4trn – State govment – N10.4trn

Out of di N15.8trn wey Tinubu administration get from di removal of fuel subsidy, N5.4trn bin go di federal govment purse, while dem share N10.4trn to states and local govments.

State and local govments for di federation receive N10.4trn from di subsidy saving.

Di minister of finance say e dey important for dem to get share sake of say no be only the federal govment bin feel di effect of di subsidy remove, state and local govments also feel am to as e show through di Federation revenue sharing to subnational governments.

₦9.39trn for wages, minimum wage and allowances

Di biggest extra money wey govment spend na ₦9.39 trillion dem use for wage adjustments; minimum wage increases and allowances for public servants between June 2023 and December 2025.

Di minister say dis amount pass di whole N5.4trn wey di federal govment receive from di share of subsidy savings.

For July 2024, President Tinubu bin approve 70,000 naira ($43) as di new minimum wage for Nigerian workers from N30,000 wey e be bifor, afta e assent to di national minimum wage legislation.

Di law provide for review of di minimum wage evri three years.

"Di extra money wey federal govment dey spend for higher wages pass di total savings wey dem earn from subsidy removal," e tok.

₦9.37trn to service external debt service

Oyedele explain say di federal govment spend another ₦9.37trn to service external debt service wey exchange-rate depreciation cause.

Togeda, di wages and external debt service wey govment dey service account for di two largest incremental expenditure lines.

Di minister tok say di increase for external debt servicing na mostly becos of di naira depreciation, becos di value of di debt remain for dollar but na naira dem dey use to pay.

"If we dey pay $1 million bifor for interest on foreign debt, na still di same $1 million, but instead of N460, e don turn N1,415 now,:

"Na more naira we go need to pay. And I don tok dis bifor, wen you get debt service to pay, you no go fit negotiate, you no go fit delay, you go pay. Becos delay or default get consequences."

₦6.5trn for Strategic infrastructure

Di third-largest incremental expenditure line na ₦6.5 trillion for strategic infrastructure.

Dis na part of di ₦30.64 trillion in incremental expenses dem record ova di period.

For June 2026, bin approve rehabilitation of 27 road projects wey dia value pass N3.9 trillion across 15 states as part of di federal govment drive to improve road infrastructure nationwide.

Minister of Works, David Umahi wey announce di informate tok say di approved projects span Adamawa, Benue, Cross River, Ebonyi, Ekiti, Kogi, Kwara, Lagos, Niger, Ondo, Osun, Oyo, Plateau, Taraba and Yobe states.

Umahi say di council approve di re-award of di 409-kilometre dual carriageway project for Niger State under di tax credit scheme to businessman Aliko Dangote at a cost of N1.8 trillion.

"Oda major approvals include N276 billion for di dualization of di Ilorin-Ogbomoso Road; N265 billion for di reconstruction of di Iseyin-Eruwa-Agbesi Road linking Oyo and Kwara states;

N217 billion for the dualization of the old alignment from Ijaye through the Federal Government College to Ilorin Road with a spur to Akinmorin; and N116 billion for the 21-kilometre Abakaliki-Afikpo Road in Ebonyi State.

"Di govment bin also approve N110 billion for di Ogbomoso-Oko-Illupu Road for Oyo and Osun states; N104 billion for di rehabilitation of Sections One and Two of di Ilorin-Omorin-Ebe-Kabba-Obajana Road for Kwara and Kogi states; N98 billion for di construction of the 30-kilometre Idi-Araba-Ayede-Olodo Road for Oyo state; and N92 billion for the rehabilitation of di Baban-Lamba-Sharan Phase Two Road in Plateau state," e tok.

About ₦10trn on existing revenue base

Nigeria goment say dey receive approximately ₦10 trillion out of di ₦30.64 trillion in incremental spending wey come from di existing revenue base.

In other words, di new resources fund about two-thirds of new spending, while di remaining third come from di existing revenue base.

Di minister tok say di figures show say di reforms no come mainly to increase govment revenue, but to address corruption in "fuel subsidy and foreign exchange market wey dem dey manage artificially."

On May 29, 2023, president Bola Tinubu assume office and afta im take di oath of office tok say im go stop petrol subsidy wey dey favour di rich pass di poor.

"Subsidy no longer fit justify im ever-increasing costs in di wake of drying resources." Oga Tinubu tok.

E tok say under im administration, dem go re-channel di money from fuel subsidy into beta investment in public infrastructure, education, health care and jobs wey go materially improve di lives of millions.

30trn on Legacy Ways and Means stock

Di minister say Nigeria inherit one ₦30 trillion legacy Ways and Means stock for May 2023.

E say dem don reduce am and if to say dem no intoduce di reform, di gbese for don reach at least ₦60 trillion and rising.

Di significance na di attempt to move away from structural dependence on monetary financing.