The presidency has described former Vice-President Atiku Abubakar’s proposal to restore petrol subsidy if elected president in 2027 as “retrogressive”, accusing him of making the promise out of desperation for power.
On Wednesday, the African Democratic Congress (ADC)
presidential candidate, said he would restore the petrol subsidy if elected
president in 2027.
However, Bayo Onanuga, special adviser to President Bola
Tinubu on information and strategy, said the proposal would return Nigeria to a
subsidy regime that was “wasteful, corruption-ridden and financially
burdensome”.
In a statement on Thursday, Onanuga said Atiku is entitled
to propose alternative policies but argued that Nigerians deserved to know how
his proposed subsidy would be funded and implemented under the current
petroleum-sector framework.
He said Atiku’s position represented a reversal of his
previous stance on petrol subsidy, noting that the former vice-president had
advocated the removal of the subsidy before the 2023 presidential election.
“It is not difficult to explain why Atiku has latched onto
the abandoned subsidy regime, five months to the election,” Onanuga said.
“Desperate for power, he needed to make a promise that he
knew, if he were candid with our people, does not make fiscal sense, is
retrogressive, and is against the genuine interest of the people.”
‘NO N30trn SUBSIDY WINDFALL’
The presidential aide disputed Atiku’s claim that the
federal government had failed to account for about N30 trillion in savings and
revenues from subsidy removal.
Onanuga said the N30 trillion figure did not represent
subsidy savings, describing the former vice-president’s claim of a subsidy
windfall as unfounded.
“Contrary to Atiku’s claim in his interview, no N30 trillion
subsidy windfall or savings exists anywhere except in his imagination,” he
said.
Onanuga said the subsidy regime involved the Nigerian
National Petroleum Company Limited (NNPC) absorbing the difference between the
cost of petrol and the regulated pump price, resulting in substantial costs to
government.
He said the Petroleum Industry Act (PIA) established a
framework for ending the subsidy regime by June 2023, adding that Tinubu only
accelerated the process by a few weeks after assuming office.
He added that Nigeria’s petroleum sector had changed
significantly since the removal of subsidy, particularly with the emergence of
substantial domestic refining capacity.
Onanuga cited the Dangote Refinery as a major development
that had altered the country’s dependence on imported petrol.
He argued that restoring the old subsidy system could
undermine local refining and place smaller domestic refineries under financial
pressure.
According to him, Nigeria is increasingly moving from
reliance on imported refined products towards domestic refining, with potential
benefits for energy security, foreign-exchange conservation and job creation.
“The subsidy debate must therefore be grounded in the
realities of today’s market rather than treated as though Nigeria’s petroleum
sector has remained unchanged,” he said.
‘WHO WILL PAY FOR SUBSIDY?’
Onanuga challenged Atiku to explain how much his proposed
subsidy would cost and where the money would come from.
“If petrol is sold below its economic cost, which is about
N1,200 to N1,300, someone must absorb the difference,” he said.
“Ultimately, that cost falls on the public finances—through
reduced funds for infrastructure and social services, reduced allocation to
states and 774 local councils, increased borrowing, higher public debt, or some
combination of these.”
The presidential aide said the government recognised the
hardship caused by higher petrol prices but argued that sustainable relief
should not involve recreating a fiscal arrangement that previously placed
significant pressure on public finances.
He cited the government’s compressed natural gas (CNG)
initiative as an alternative aimed at reducing transportation and energy costs.
Onanuga urged Atiku and other political actors to provide
clear fiscal and legal details for any proposal to restore petrol subsidy.
“Political promises must be backed by fiscal arithmetic,” he
said.
He asked Atiku to explain the annual cost of the proposed
programme, its funding source, whether the government would borrow to finance
it, and whether amendments to existing petroleum-sector laws would be required.
“Nigeria cannot afford to return to policies whose costs are
hidden from citizens until they appear later as debt, reduced government
spending on social services, and further pressure on the national currency,” he
said.
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