Nigerians demand an answer: Three Years After Subsidy Removal; Questions Mount Over Where Savings Went

 

ABUJA, May 29, 2026— Three years after President Bola Ahmed Tinubu announced the removal of fuel subsidy on May 29, 2023, questions are mounting over the impact of the policy and the whereabouts of projected savings.

The president made the declaration without prior briefing or documented plan, later admitting the announcement was made spontaneously. Since then, Nigerians have faced sharp increases in fuel prices, transport costs, and living expenses.

Poverty Levels Rise

According to World Bank data released in April 2026, the poverty rate in Nigeria has climbed to 63 percent, with over 140 million Nigerians now living in poverty. Before the subsidy removal, the poverty rate stood at 56 percent.

The increase has intensified public debate over whether the reform has delivered promised benefits or worsened hardship for vulnerable households.

Where Are the Savings?

The International Monetary Fund estimated that subsidy removal would save Nigeria about N700 billion monthly, roughly 2 percent of GDP. However, the World Bank’s Nigeria Development Update revealed that the Nigerian National Petroleum Company Limited, NNPCL, has remitted only about 50 percent of those gains to the Federation Account.

NNPCL officials said the remaining funds are being used to settle past arrears. Critics are questioning who authorized those arrears and why Nigerians should bear the cost of mismanagement at the state-owned company.

Former Vice President Atiku Abubakar accused the Tinubu administration of spending N17.5 trillion in one year on what the government terms “energy-security costs” and “under-recovery,” describing them as subsidy by another name. He asked why Nigerians still pay as much as N1,000 per litre if subsidy is truly gone.

Government and Expert Views

Governor Hope Uzodimma defended the policy, saying foreign reserves have risen to $49 billion and that subsidy removal ranks among the most consequential anti-corruption measures undertaken.

But Professor Adeola Adenikinju, President of the Nigerian Economic Society, questioned the social impact: “When you remove subsidy, you are supposed to take care of the poor and vulnerable, but are we doing that now? Poverty has increased. Unemployment is on the high side. In what way have we been able to mitigate the effects of subsidy removal?”

Finance Minister Taiwo Oyedele acknowledged the limits of the reform, stating that even with zero corruption and waste, Nigeria’s resources are insufficient. He noted that the country’s entire annual budget for over 200 million people is less than $50 billion, smaller than the budget of New York City.

Public Reaction

Three years on, many Nigerians say the promised “temporary pain” has become permanent, while the promised “permanent gains” remain unclear. The debate continues over transparency, accountability, and whether subsidy savings are reaching ordinary citizens or being lost to inefficiency and opaque spending.

As the 2027 election cycle approaches, the subsidy issue is expected to remain a central topic in national discourse.

The author, Mohammed Bello Doka, can be reached at bellodoka82@gmail.com