The Presidency has criticised former Vice President Atiku Abubakar’s proposal to restore fuel subsidy if elected president, describing the policy as retrogressive and financially unsustainable.
Bayo Onanuga, Special Adviser to the President on Information and Strategy, said this in a statement on Thursday, arguing that restoring the subsidy would reverse reforms carried out in the petroleum sector under President Bola Tinubu.
Onanuga said Atiku’s proposal was a departure from his previous position on fuel subsidy, alleging that the former vice president had supported its removal before the 2023 presidential election.
He said, “Atiku Abubakar has finally revealed his economic plans to Nigerians, should he be elected as President by January next year,” adding that the proposal to restore subsidy was “retrogressive” and against the interests of Nigerians.
According to him, the subsidy was not money kept in government coffers for distribution to Nigerians, but the difference between the actual cost of petrol and the regulated pump price.
He said the subsidy regime had imposed a huge burden on public finances, adding that its removal was provided for under the Petroleum Industry Act before the Tinubu administration accelerated the process in June 2023.
Onanuga argued that restoring subsidy would require a fresh legal and fiscal framework, including identifying the source of funding and determining how the policy would operate under the current petroleum market structure.
He also said Nigeria’s petroleum industry had changed significantly since 2023, particularly with the growth of domestic refining capacity.
“Today, the emergence of substantial domestic refining capacity has fundamentally altered that equation. The Dangote Refinery has become a major source of locally refined petrol,” he said.
The presidential aide further warned that returning to the old subsidy regime could undermine smaller domestic refineries, lead to job losses and increase pressure on Nigeria’s foreign exchange reserves.
He said the government had instead redirected resources previously used to subsidise petrol to the three tiers of government, noting that about N3tn was shared from the Federation Account in July.
Onanuga also highlighted the government’s promotion of Compressed Natural Gas as a cheaper alternative to petrol, saying CNG could help reduce transportation and energy costs.
He said, “We believe sustainable relief is different from recreating a fiscal arrangement that will again cripple our country.”
Onanuga, however, acknowledged that the rising cost of petrol had created significant hardship for households and businesses, saying the government would continue to pursue measures aimed at reducing the burden.
He challenged Atiku to provide details on how his proposed subsidy would be funded, asking how much the programme would cost annually, whether the government would borrow to finance it and whether amendments to existing petroleum legislation would be required.
The presidential aide said Nigerians also deserved to know what exactly the proposed subsidy would cover, given the country’s increased domestic petrol production.
He urged political actors to ensure that proposals on the economy were backed by clear fiscal calculations and legal frameworks.
“Political promises must be backed by fiscal arithmetic,” Onanuga said, urging Atiku and other political actors to present Nigerians with the full fiscal and legal implications of any proposal to restore fuel subsidy.
