ActionAid Nigeria Demands Full Remittance of Fuel Subsidy Gains to Federation Account Amid Rising Poverty and Fiscal Crisis

ActionAid Nigeria Demands Full Remittance of Fuel Subsidy Gains to Federation Account Amid Rising Poverty and Fiscal Crisis

By: Michael Mike

ActionAid Nigeria (AAN) has expressed deep concern over the delay and partial remittance of fuel subsidy removal gains by the Nigerian National Petroleum Company Limited (NNPCL).

This followed revelations contained in the World Bank’s Nigeria Development Update (NDU) titled “Building Momentum for Inclusive Growth, AAN lamented that: “Despite the full removal of petrol subsidies as of October 2024, NNPCL only began transferring revenues to the Federation Account in January 2025 and has, since then, remitted only 50% of the gains.”

AAN in a statement by its Country Director, Andrew Mamedu decried that the withholding of critical national revenue amid worsening economic hardship is unacceptable, noting that the World Bank estimates that these gains should amount to roughly 2.6% of Nigeria’s GDP in 2024 – approximately ₦10 trillion.

AAN stated that withholding half of this revenue from the Federation Account directly undermines the constitutional revenue-sharing framework and denies both the federal and subnational governments vital resources needed to provide basic public services and reduce poverty.

Mamedu said: “At a time when inflation remains high, the cost-of-living crisis has intensified, and over 104 million Nigerians are already living in multidimensional poverty, it is unconscionable that the full benefits of subsidy reform have not been transparently and equitably applied for national development,” warning that unless this fiscal opacity is urgently addressed, the reforms intended to stabilise the economy will only deepen inequality and exclusion.

He said: “We note the World Bank’s commendation of Nigeria’s macroeconomic reforms – including exchange rate unification and tighter monetary policies – but assert that economic stability without inclusive governance and justice for the poor is unsustainable.”

Mamedu said: “Today, ActionAid Nigeria calls for the following urgent actions:

“The President, in his capacity as Minister of Petroleum Resources, must direct the NNPCL to immediately remit the full revenue gains from fuel subsidy removal into the Federation Account, in compliance with the 1999 Constitution and the Petroleum Industry Act 2021. Partial remittance is a violation of constitutional principles and endangers public finance transparency.

“The Federal Ministry of Finance and the Office of the Accountant-General must ensure full transparency in the management and distribution of subsidy savings.A publicly accessible breakdown of allocations and expenditure must be published quarterly to ensure accountability and prevent fiscal leakages.

“The National Assembly must exercise its oversight function by summoning NNPCL leadership for a public hearing and conducting a comprehensive review of arrears, subsidy payments, and remittances.This must be followed by legislative action to prevent recurrence.

“The government must prioritise channelling these revenues toward pro-poor investments – including expanding the national social protection register, improving access to affordable public transport, and supporting local food systems. Without deliberate intervention, the poorest Nigerians will continue to shoulder the cost of reforms they cannot afford.

“The forensic audit of NNPCL, as announced by the Minister of Finance, must be independent, time-bound, and made public upon completion. Nigerians have a right to know how public resources are being managed.

“The Fiscal Responsibility Commission must assert its role in monitoring and reporting breaches of fiscal transparency and revenue remittance. Fuel subsidy savings cannot become another opaque stream of public wealth lost to institutional inefficiency.

“State governments must demand their fair share of the subsidy savings and demonstrate corresponding increases in public investment in education, health, infrastructure, and social welfare. They must also be prepared to sue NNPCL, if full remittances are not made. Furthermore, states must uphold transparency and be accountable in the use of their allocations, ensuring that every naira is directed towards pro-poor programming that delivers tangible benefits to citizens.

“Citizens must actively monitor and track the use of these resources. We urge the public, civil society organisations, community leaders, and the media to hold both federal and state governments accountable. Collective vigilance and civic engagement are essential to prevent corruption and ensure that the gains from subsidy removal translate into improved living conditions for all Nigerians.”

Mamedu reminded all stakeholders that inclusive economic growth cannot be achieved through macroeconomic reforms alone. Nigeria’s aspiration for a $1 trillion economy by 2030 will remain out of reach if fiscal governance continues to neglect the poorest and most vulnerable, insisting that:
“The full and timely transfer of subsidy removal gains is not just a matter of economic reform – it is a test of political will, public trust, and national accountability.”

ActionAid Nigeria Demands Full Remittance of Fuel Subsidy Gains to Federation Account Amid Rising Poverty and Fiscal Crisis