Labour Demands Evidence as FG Explains How Fuel Subsidy Savings Were Spent

The Federal Government has defended its handling of savings from the removal of fuel subsidy, saying the funds have been used to finance debt obligations, increase workers’ wages, support student loans and meet other critical national expenses, but organised labour insists the claims must be backed by verifiable evidence.

Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, made the remarks during the ongoing 7th Africa Emerging Markets Forum in Abuja, where he promised that Nigerians would soon receive a detailed account of how the subsidy savings have been utilised.

“There was a question about the subsidy savings, where has it gone to?… It’s a valid question,” Oyedele said.

He explained that while subsidy removal generated substantial savings, the broader objective was to eliminate economic distortions and corruption.

According to him, the funds helped replace previous Ways and Means financing, cover increased debt servicing costs following higher interest rates, fund the implementation of the ₦70,000 minimum wage, and support programmes such as NELFUND, which now provides tuition and monthly stipends to over 1.5 million students.

“We’ll provide a detailed explanation of how much we saved and how the money has been spent,” the minister assured.

Oyedele also defended the government’s borrowing strategy, saying stronger revenue collection does not remove the need for loans when expenditure exceeds income.

“There’s nothing wrong with borrowing, provided you apply it productively for every one naira and every $1 that we borrow,” he said.

Organised labour, however, rejected the explanation, describing it as misleading.

Olowoyo Gbenga, General Secretary of the Nigeria Civil Service Union and National Secretary of the Joint National Public Service Negotiating Council (Trade Union Side), argued that the government had yet to provide credible evidence showing where the subsidy savings went.

He questioned claims that the funds financed salary increases, pointing out that workers are still awaiting implementation of the 40 percent peculiar allowance linked to the new minimum wage, as well as unpaid wage awards.

“Nigerian workers will not allow themselves to be fooled again,” Gbenga declared.

An anonymous senior official of the Nigeria Labour Congress echoed the criticism, accusing the minister of presenting unverifiable claims.

“The minister is only trying to shift the blame… He should provide verifiable facts and data to back up his claims,” the labour official said.

The NLC representative further alleged that proceeds from subsidy removal had been spent on non-essential government purchases and called on the Federal Government to provide a transparent breakdown of all funds generated since fuel subsidy was removed in 2023.

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