Former Vice President and African Democratic Congress (ADC) presidential candidate, Atiku Abubakar, has proposed a new petroleum subsidy model that would move government support from fuel imports to Nigerian refineries, while placing a firm limit on how much public money can be spent.
The proposal, contained in his Atiku Economic Recovery Plan (AERP) 2027, would allow qualifying refineries to access crude oil at preferential prices, but only if they meet production, transparency and domestic supply requirements.
Atiku’s position was contained in a statement issued on Thursday by his Senior Special Assistant on Public Communication, Phrank Shaibu.
He said the plan was not a return to the subsidy system that existed before its removal but an attempt to use government support to strengthen local refining and reduce the cost of petroleum products.
“My proposal is not to resurrect the old subsidy regime. We will move subsidy from importation to production, from middlemen to Nigerian refineries, and from unverifiable claims to verifiable barrels.”
Atiku: Subsidy Must Benefit Consumers
Under the proposed arrangement, eligible public and private refineries would receive Nigerian crude at a preferential price.
But Atiku said the cheaper crude would come with conditions. Refineries would have to show how much crude they received, what they produced and how much was supplied to the Nigerian market.
He said the government would also put a clear value on the crude supplied below its market price so that the financial cost of the programme would not be hidden.
“We will determine what Nigeria can afford before we subsidise. We will not subsidise first and discover the bill afterwards,” he said.
The proposal would require the government to publish the maximum amount it is prepared to spend, while independent auditors would verify the movement of crude and petroleum products.
No Cheap Crude Without Cheaper Fuel
Atiku said refineries would not be allowed to enjoy cheaper crude while Nigerians continue to pay the full market cost of the resulting products.
Under the plan, access to subsidised crude would depend on the refinery supplying an agreed quantity of petroleum products to the Nigerian market at a price that reflects the benefit of the cheaper crude.
Crude allocation, refinery intake, production, stock levels and domestic deliveries would also be reconciled.
“If you receive subsidised Nigerian crude, you must refine it in Nigeria, supply the agreed products to Nigerians and pass the benefit to Nigerians. Otherwise, you do not qualify,” Atiku said.
He added that the system would be designed to prevent fictitious imports, unverifiable subsidy claims and manipulation of production records.
Refineries to Face Strict Conditions
The former vice president said the scheme would not be designed for any particular refinery or operator.
Instead, he said public and private refineries that meet the requirements would be eligible, with allocation determined by independently verified capacity, efficiency, domestic supply and compliance.
Operators that divert subsidised crude or products to foreign markets, falsify records or fail to meet domestic supply obligations would lose access to the programme.
They could also be required to refund the subsidy benefit and face regulatory or legal action.
“Nigeria will not subsidise anybody’s private profit. Public support must produce a measurable public benefit,” Atiku said.
Atiku Wants Subsidy Spending Capped
Another major feature of the proposal is a fixed annual spending ceiling.
Atiku said the government should decide through the national budget how much it can afford to spend on the intervention instead of allowing subsidy liabilities to build up and appear later.
“No refinery gets unlimited support. No marketer brings government a surprise bill. No agency manufactures an under-recovery after the transaction,” he said.
He said the National Assembly would know the amount appropriated, while Nigerians would know the government’s maximum financial exposure.
The proposal would also take into account how the intervention affects revenues going to the federal, state and local governments.
Atiku Says Subsidy Should Eventually End
Atiku said the proposed subsidy would have a sunset mechanism, meaning government support would reduce as Nigeria’s refining industry becomes stronger.
He said support per barrel would gradually fall as refinery capacity increases, production improves, competition grows and production costs come down.
“Our objective is not permanent subsidy,” Atiku said.
“It is to use temporary and disciplined support to build a refining industry strong enough eventually not to need subsidy.”
He said the success of the policy would be measured by its effect on refinery output, fuel prices, jobs, investment and the wider economy.
For Atiku, the aim goes beyond reducing the price of petrol.
“The ultimate objective is not merely cheaper petrol. It is cheaper transportation, cheaper food, stronger businesses, more Nigerian jobs and greater purchasing power.”
Atiku Questions Tinubu’s Subsidy Removal
The ADC presidential candidate also turned his attention to President Bola Tinubu’s decision to remove the petrol subsidy in 2023, questioning whether subsidy-related costs have continued to appear in government accounts.
Tinubu declared on May 29, 2023, that “subsidy is gone”, a decision that was followed by a sharp increase in petrol prices and higher transportation and living costs.
Atiku said Nigerians were told they had to bear the immediate pain because the subsidy had ended.
He, however, pointed to figures in NNPCL’s audited financial statements, which he said showed ₦4.84 trillion in Energy Security Expenses in 2023 and ₦7.13 trillion in 2024.
Atiku said the government should explain what those expenses represent and whether they include under-recoveries, pricing differences or other petroleum-related costs.
“If government continued absorbing differences between the economic cost of petroleum products and what was recovered from the market, then Nigerians are entitled to ask how that differs economically from the subsidy they were told had disappeared,” he said.
He argued that Nigerians should not be paying higher pump prices while public funds continue to cover petroleum-related costs that have not been adequately explained.
Atiku Demands Answers on ₦30 Trillion
Atiku also raised questions over what he described as about ₦30 trillion in Federation revenues, deductions, savings, transfers and related funds.
He was careful to state that he was not claiming the entire amount was fuel subsidy money or that it had been stolen.
Instead, he called for a detailed reconciliation showing where the money came from, where it went and the legal basis for the transactions.
“We are not saying ₦30 trillion is fuel subsidy or that ₦30 trillion has been proven stolen.”
“We are saying that approximately ₦30 trillion reflected across Federation revenues, deductions, savings, transfers and related classifications requires a complete, month-by-month public reconciliation.”
Atiku called on the government to publish every deduction, identify every beneficiary and show every transfer and balance.
He also said previous subsidy transactions should be investigated and that anyone found, through due process, to have diverted public funds should face prosecution and asset recovery.
‘Nigerians Cannot Pay for Subsidy Twice’
Atiku said his proposed model would be different from what he described as the current approach because it would establish the rules and financial limits before the intervention begins.
His administration, he said, would budget the subsidy, track every barrel, verify refinery output, monitor domestic supply and publish the accounts.
“Nigerians cannot pay for subsidy removal twice — through punishing pump prices and through unexplained subsidy-like costs against their commonwealth,” Atiku said.
He summed up his proposed approach in six words:
“Target it. Cap it. Budget it. Track it. Audit it.”
Atiku said the ultimate goal would be to gradually reduce government support as domestic refining grows until Nigeria no longer needs the subsidy.
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