The removal of the fuel subsidy by President Bola Tinubu’s administration has led to a significant increase in revenue shared among federal, state, and local governments, rising from ₦760 billion in 2023 to ₦3.2 trillion in 2024.
This was disclosed by Sunday Dare, the Special Adviser on Media and Public Affairs to the President, during an interview on Arise Television’s Prime Time. He emphasized that prior to the subsidy removal, Nigeria was losing $7.5 billion annually, which he described as unsustainable.
Dare urged Nigerians to hold state governors accountable for the effective use of the increased revenues, which he said are now available for critical human capital development.
The Cost of Subsidy
“For over three decades, successive administrations avoided removing the subsidy despite its inefficiency and corruption-ridden structure,” Dare stated. He noted that the subsidy system had cost the country billions, with 87 Nigerian companies and individuals implicated in fraud during that period.
“At the point he [President Tinubu] came in, two brakes were necessary. This country was hemorrhaging $7.5 billion every year. The removal of the subsidy was inevitable to stabilize the economy,” he explained.
The subsidy removal has had a transformative effect on the Federation Account Allocation Committee (FAAC) disbursements. According to Dare, monthly allocations surged from ₦760 billion in 2023 to ₦3.2 trillion in 2024, tripling the funds available to state governments.
He noted that the freed-up resources are critical for addressing governance challenges, stating, “If the subsidy had not been removed, these additional funds would not be available.”
Imo State Governor Hope Uzodinma recently described the removal of the fuel subsidy as a “direct blessing” for states, emphasizing its potential to fund development projects and improve governance.
The presidency continues to stress the importance of transparency in utilizing the increased allocations. Citizens and stakeholders are encouraged to monitor how these funds are invested to ensure long-term benefits for the nation.
