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The Federal Government has defended the removal of the petrol subsidy, while dismissing former Vice President Atiku Abubakar’s proposal to introduce a new subsidy model for crude supplied to local refineries.
Senior Special Assistant to President Bola Tinubu on Digital and New Media, O’tega Ogra, criticised the proposal during an interview on ARISE News on Monday, questioning its cost, structure and safeguards against the abuses associated with the former subsidy regime.
Ogra argued that Atiku’s proposal would merely shift the subsidy from the point where consumers buy petrol to the supply of crude oil to refineries without eliminating the underlying problems.
“A pig that you dress in white is still a pig. It’s as simple as that. That you move the subsidies from the pump to the barrel, you’re just doing the same invisible subsidy program.”
According to the presidential aide, Atiku had not provided sufficient details on how the proposed policy would operate, including the price limits, quantity of crude to be supplied to refineries, source of the crude and the projected cost.
Ogra estimated that implementing the proposal based on prevailing crude oil prices could cost between ₦19.1 trillion and ₦22.2 trillion annually.
He also questioned how the government would determine whether subsidised Nigerian crude was ultimately used to produce petrol for domestic consumption, particularly because local refineries can process crude obtained from different sources.
The presidential aide said refineries could blend Nigerian crude with imports and export some of their refined products, creating difficulties in tracking the portion of subsidised crude that actually benefits Nigerian consumers.
He therefore challenged proponents of the proposal to explain how the government would prevent subsidised crude from creating fresh loopholes and financial leakages.
Ogra cited the previous subsidy regime as an example of the potential risks, recalling that the government had initially budgeted about ₦250 billion for the programme in 2012 but eventually recorded subsidy-related receipts of approximately ₦3.5 trillion.
He also accused Atiku of repeatedly changing his position on the proposed subsidy arrangement.
“He has flip-flopped on it four times already in one week.”
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The presidential aide also rejected the argument that Tinubu abruptly ended the petrol subsidy in 2023.
According to Ogra, successive administrations had progressively reduced the subsidy before the Tinubu administration came into office, while legislation had already provided for subsidy payments only up to June 2023.
“So, the subsidy program would have ended in June regardless of whether President Bola Ahmed Tinubu said the subsidy is gone, there is no money for it.”
However, Ogra acknowledged that the policy should have been implemented more gradually because of its immediate effect on consumers.
“Honestly, Rotus, I agree with you. The subsidy should have been staggered.”
He said the Federal Government had subsequently introduced measures intended to cushion the impact of the economic reforms, including social intervention programmes and initiatives aimed at reducing transportation costs.
On conditional cash transfers, Ogra said the National Social Register had undergone an audit and revalidation following concerns about the credibility of the data.
He said beneficiaries had also been connected to wallets linked to their National Identification Numbers and Bank Verification Numbers to improve transparency and reduce leakages.
Ogra further highlighted the government’s Compressed Natural Gas initiative, saying more than 120,000 vehicles had been incorporated into the programme through subsidised conversion kits or the provision of CNG-powered vehicles.
He said expanding CNG adoption, particularly along major transportation routes, would help lower the cost of movement for Nigerians.
The presidential aide maintained that the administration’s economic reforms were aimed at creating a more sustainable system and ensuring that their benefits eventually reached citizens at the grassroots.
