Former Minister of Finance, Kemi Adeosun, has made startling revelations about the federal government’s handling of fuel subsidy, claiming that every minister in the cabinet during her tenure was fully aware that the policy was detrimental to Nigeria’s economy but lacked the political will to end it.
Adeosun made the disclosure during an appearance on Channels Television’s Inside Sources programme on Friday, pulling back the curtain on internal government discussions that shaped fuel subsidy policy during the administration of former President Muhammadu Buhari.
The former minister, who resigned from office in 2018 following allegations that the National Youth Service Corps certificate she submitted as part of her official records was forged, spoke candidly about the challenges the government faced in addressing what she described as an unsustainable economic burden.
“There was no minister who did not see that subsidy was killing us,” Adeosun stated emphatically, contradicting any suggestion that the cabinet was divided on the economic impact of fuel subsidies.
According to Adeosun, the Buhari administration attempted various strategies to address the subsidy issue without completely removing it, mindful of the potential backlash from Nigerians who had grown accustomed to subsidised fuel prices.
She referenced the Subsidy Reinvestment and Empowerment Programme, known as Sure-P, as one of several initiatives aimed at managing the subsidy burden whilst cushioning its effects on citizens.
The former minister revealed that Nigeria’s consumption figures raised serious concerns within government circles, with daily fuel consumption reportedly reaching as high as 65 million litres at certain periods—a figure that seemed impossibly high given the country’s vehicle population.
“Nigeria had had like 10 million cars at the time, so what’s going on? It was not just possible,” Adeosun recalled, describing the government’s growing suspicion that something was fundamentally wrong with the subsidy system.
The breakthrough came when the government decided to deploy tracking technology to monitor fuel distribution across the country. The results, according to Adeosun, confirmed what many had suspected: Nigeria was inadvertently subsidising fuel consumption for neighbouring West African countries.
“We tried different things to stop fuel subsidy. Do you remember Sure-P? We knew that Nigeria has four international borders. And then you are subsidising, but your own fuel was 44 per cent lower than that sold in other countries, and they are land borders,” she explained.
The price differential created a lucrative incentive for smuggling, with Nigerian fuel being transported across land borders to neighbouring countries where it could be sold at significantly higher prices. The government found itself in the uncomfortable position of funding fuel consumption across West Africa, a burden it could ill afford.
“What it meant was that the federal government was not subsidising just Nigeria, but the whole of West Africa, which we could not afford to do,” Adeosun stated, highlighting the scale of the problem.
She emphasised that the funds spent on subsidies represented opportunity costs for critical infrastructure and social services. “Now, the money you spend on subsidies was money you could not spend on roads, education, or health. And there was nothing to show for the fuel subsidy. So, everybody knew that policy had to go,” the former minister said.
Despite this knowledge, the administration struggled to summon the political courage to completely remove the subsidy, aware of the potential social and economic disruptions such a decision would trigger.
President Bola Tinubu eventually took the bold step of announcing the end of fuel subsidies in May 2023, shortly after assuming office. His now-famous declaration that “subsidy is gone” marked a decisive break from decades of subsidy policy.
However, the scale of previous subsidy spending revealed the magnitude of the problem Adeosun and her colleagues had grappled with. According to available data, Nigeria spent cumulatively $74 billion, equivalent to N112.94 trillion, on fuel subsidies between 2005 and 2021—resources that could have transformed the country’s infrastructure and social services.
The challenges have not ended with the formal removal of subsidies. The Nigerian National Petroleum Company Limited reported N17.5 trillion in energy security and subsidy-related expenses in late 2024 for the prior period, according to the Nigeria Extractive Industries Transparency Initiative. This massive figure highlights the continued drain on government revenue and the complexity of completely disentangling the country from subsidy arrangements.
Despite the Tinubu administration’s declaration that subsidies were “gone,” the government has faced massive “under-recovery” costs, suggesting that some form of subsidy or price support mechanism has continued, albeit under different terminology.
Adeosun acknowledged these challenges but urged Nigerians to maintain patience with the reform process, arguing that the long-term benefits would justify the short-term hardships.
“Now that the policy is gone, of course, there are some overspills, but in the long run, Nigerians are going to be so much better off on that, because if you look at the revenues going to FAAC, they are significant,” she said, referring to the Federation Account Allocation Committee, which distributes revenue among federal, state, and local governments.
The former minister stressed that the crucial question now was how government converts the savings from subsidy removal into tangible benefits for citizens. She advocated for structural interventions rather than what she described as palliatives, which she suggested were insufficient to address the policy’s impact on ordinary Nigerians.
“So, the question has to be…how do you convert those savings to help the people? We call them policy overspills. I don’t like the word palliative. The government has to do something structural to help people adapt to these policy changes,” Adeosun stated.
She called on Nigerians to hold their leaders accountable by scrutinising budget allocations and asking informed questions about how public funds are being utilised.
“When governors publish their budgets, people have to look and ask intelligent questions. Not emotional ones, and conclude that the government is stealing money. They may not be stealing. They may just have a huge workforce and bloated budgets, but people need to ask questions,” she advised.
Adeosun’s comments represent a rare candid admission from a former government official about the political calculations and compromises that shaped fuel subsidy policy over the years. Her revelations that the entire cabinet recognised the policy’s unsustainability yet struggled to act decisively raise questions about governance, political will, and the influence of vested interests in policy-making.
During the same interview, Adeosun also addressed her resignation from office, claiming that the NYSC certificate controversy was exploited by powerful enemies who wanted her removed from the cabinet. She revealed that she informed President Buhari of her intention to pursue legal action against the federal government to clear her name, and that he supported her decision.
“I’m not confused about the fact that I had powerful enemies who I believed saw an opportunity. Let’s get rid of her,” Adeosun stated, explaining that she could not remain in government whilst suing that same government.
“I sued the federal government. You can’t be suing the government and staying in the government. You can’t. You have to go. I think it is the right thing to do,” she said.
Her resignation in 2018 came after allegations emerged that her NYSC certificate was forged. The controversy cut short her tenure as Finance Minister during a period when the government was grappling with economic challenges, including the very subsidy issues she has now spoken about publicly.
