The Federal Government has spent N30.64 trillion in government expenditures to mitigate the impact of President Bola Tinubu‘s policies, which have resulted in N15.8 trillion in savings for the Federation thirty months after he eliminated the gasoline subsidy and implemented other extensive economic reforms.
The government said its total incremental expenditure between June 2023 and December 2025 was N30.64 tn, exceeding the N20.4 tn in additional resources available to the Federal Government from subsidy savings, higher revenue, and borrowing by N10.24 tn, or 50.2 percent.
This shows that the removal of the petrol subsidy created significant fiscal space but did not produce a pool of idle cash for the federal government.
Instead, the government said the resources were absorbed by rising wage costs, debt servicing, infrastructure spending, and other obligations arising from the same economic reforms.
Put differently, for every N100 the federal government generated in additional resources, it spent about N150, leaving about one-third of the expenditure to be funded from its existing revenue base.
The development came as the finance minister and coordinating minister of the economy, Taiwo Oyedele, disclosed that the removal of the petrol subsidy and the unification of the foreign exchange market mobilized N15.8 trillion in additional resources for the Federation during the period.
However, the government received only N5.4tn, representing 34 per cent of the subsidy savings, while the states received N6.5tn and local governments got N3.9tn under the Federation Account allocation formula.
These figures were contained in the Federal Government’s Nigeria Reform Scorecard titled “The Benefits, Costs, and Harm Prevented,” released on Wednesday. The purpose of the news conference was to provide Nigerians with clear and factual information on the savings arising from the removal of the foreign subsidy and foreign exchange unification.
According to Oyedele, the N15.8tn was not paid into the Federation Account under a heading described as “subsidy savings.”
Instead, he said the combined effect of the petrol subsidy removal and foreign exchange reforms increased the naira value of revenues accruing to the Federation.
“Between June 2023 and December 2025, subsidy savings mobilized a sum of N15.8 trillion in resources for the Federation,” Oyedele said.
“Many people will say, ‘Where is the subsidy saving?’ As a matter of fact, there wasn’t any line in the Federation Account with the description, ‘subsidy savings.’
“So, the subsidy savings showed up in the form of higher collection by customs because, for every one dollar of import duty before, at N460, it became one dollar at N1,004, N1,003, or N1,005.
“The NRS, Petroleum Profit Tax that it collected before, same dollar, higher amount in naira. So, the savings showed up in the Federation accounts by way of higher revenue collections as a result of the reforms.”
The minister said the additional fiscal resources were not generated by the petrol subsidy removal alone, arguing that the foreign exchange reforms also ended what he described as an implicit subsidy that had created opportunities for rent-seeking.
He said, “Not just the subsidy removal, but also the exchange rate flotation, because we were subsidizing the exchange rate. And that subsidy was not going to the ordinary person or manufacturers. It was going to rent-seekers.”
The finance minister explained that although the removal of the petrol subsidy generated N15.8 trillion in savings for the federation between June 2023 and December 2025, only N5.4 trillion, or 34 percent, accrued to the federal government.
The balance was shared among the states and local governments under the statutory federation account allocation formula.
According to the scorecard, states received N6.5tn, representing 41 per cent of the total subsidy savings, while the 774 local government areas received N3.9tn, or 24 per cent.
The Federal Government also generated N3.1 trillion in additional independent revenue, mainly from increased remittances by government-owned entities, while N11.9 trillion came from additional borrowing.
This brought the Federal Government’s total incremental resources to N20.4 trillion, of which borrowing accounted for 58 percent, subsidy savings 27 percent, and other revenue 15 percent.
