By our Reporter
The Federal Government has said state governments now earn significantly more following the removal of petrol subsidy by President Bola Tinubu’s administration in May 2023.
Coordinating Minister of Finance, Wale Edun, disclosed this on Thursday at the National Health Financing Dialogue in Abuja. He explained that although ending the subsidy on Premium Motor Spirit (PMS) was a tough decision, it has yielded positive results.
According to him, the reform has boosted states’ finances, giving them more than double the funds they previously had, enabling them to contribute meaningfully to critical sectors.
Edun noted that the subsidy regime only enriched a few individuals, including foreigners, while consuming about 2.5% of the country’s GDP. He stressed that its removal has freed up resources for investment in education, healthcare, and infrastructure.
While fuel prices initially surged above ₦1,000 per litre and later dropped below ₦900, Edun said inflation has also begun to ease, falling to 21.88% in July from 22.22% in June, after peaking around 27% last year. Food inflation also declined to 22.74% year-on-year in July, compared to 39.53% in the same period last year.
He maintained that the reforms, though painful, are designed to rebuild the economy, restore investor confidence, and create opportunities across all sectors.
