The Federal Government has announced plans to publicly disclose how funds saved from the removal of fuel subsidy have been utilised, amid growing public concerns over the impact of recent economic reforms.

Speaking at the African Emerging Markets Forum in Abuja on Wednesday, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the savings generated from the removal of fuel subsidies and reforms in the foreign exchange market had largely been offset by increased debt servicing obligations and higher government expenditure.

According to Oyedele, Nigeria previously spent about five per cent of its Gross Domestic Product (GDP) on fuel subsidies and what he described as an implicit foreign exchange subsidy before the reforms were introduced.

He explained that the country’s borrowing costs had risen sharply following the reforms, with interest rates increasing from about eight per cent to as high as 24 per cent, resulting in a significant rise in debt servicing expenses that consumed a substantial portion of the savings.

The minister also noted that the government’s wage bill had almost doubled after the approval of a new national minimum wage of ₦70,000, adding that public spending had also increased through the expansion of the student loan programme, which now supports more than 1.5 million beneficiaries with tuition assistance and monthly stipends.

Responding to persistent questions about the utilisation of the subsidy savings, Oyedele acknowledged the public’s concerns and assured Nigerians that details of the expenditure would soon be made available.
“I’ve heard this question so many times, and it is a valid one,” he said.

Oyedele also disagreed with a recent assessment by the International Monetary Fund (IMF), which stated that millions of Nigerians remained in poverty despite reforms that had received positive reactions from investors.

He argued that a temporary decline in citizens’ purchasing power was an unavoidable consequence of removing long-standing subsidies, stressing that the government remained focused on achieving long-term economic stability.

According to him, the administration will measure the success of its reforms using indicators such as multidimensional poverty, growth in real per capita income and income inequality, rather than relying solely on overall GDP growth.