Erstwhile minister of finance, Kemi Adeosun, has revealed that ministers who served under the late President Muhammadu Buhari were fully aware that the fuel subsidy regime was crippling Nigeria’s economy, despite the enormous sums budgeted for it.

Ms Adeosun, who resigned from office in 2018 following allegations surrounding her National Youth Service Corps (NYSC) certificate, made the disclosure on Friday during an interview on Channels Television.

“There was no minister who did not see that subsidy was killing us. We tried different things to stop fuel subsidy,” she said. 

According to her, it was evident within government circles that the policy was unsustainable and grossly distorted fuel consumption figures, especially due to Nigeria’s porous borders and widespread smuggling to neighbouring countries.

Mrs Adeosun recalled with the introduction of the Subsidy Reinvestment and Empowerment Programme (SURE-P), Nigeria’s fuel price was about 44 per cent lower than in neighbouring countries, making smuggling inevitable.

“Do you remember SURE-P? We knew Nigeria has four international borders. You were subsidising fuel, and your price was far lower than other countries’, yet they are land borders,” she stated.

President Bola Tinubu had, in May 2023, announced the removal of fuel subsidy, which cumulatively cost Nigeria about $74 billion (N112.94 trillion) between 2005 and 2021.

Expanding on the issue, Ms Adeosun disclosed that although the federal government eventually confirmed massive fuel diversion across borders, it lacked the political courage at the time to completely remove the subsidy.

“At some point, consumption figures rose to about 65 million litres per day. We did the maths. Nigeria had around 10 million cars at the time – so what was going on? It wasn’t possible,” she explained.

She said the government later introduced tracking mechanisms, which exposed the scale of fuel smuggling.

“What it meant was that Nigeria was not subsidising just Nigerians, but the whole of West Africa-and we couldn’t afford that,” she added.

Mrs Adeosun stressed that funds spent on fuel subsidy deprived critical sectors such as roads, education, and healthcare of needed investment.

“There was nothing to show for fuel subsidy. Everybody knew that policy had to go,” she said. 

However, she noted that with the subsidy now removed, Mr Tinubu’s led federal government must ensure that savings are channelled into structural development that directly benefits citizens.

While calling for patience, Mrs Adeosun said Nigerians would ultimately reap the benefits of the policy shift.

“Now that the policy is gone, there are overspills, but in the long run, Nigerians will be much better off. If you look at revenues going to FAAC, they are significant,” she said.

She, however, advised citizens to critically scrutinise government budgets rather than make emotional conclusions.

“When governors publish their budgets, people should ask intelligent questions, not emotional ones, and immediately conclude that money is being stolen.

“They may not be stealing; they may just have bloated budgets and large workforces. People need to ask questions,” Mrs Adeosun added.