The Presidency has criticised former Vice President Atiku Abubakar over his proposal to restore petrol subsidy if elected president, describing the policy as “retrogressive” and fiscally unsustainable.

It said Atiku’s position represented a departure from his previous stance on petrol subsidy and urged him to explain how the proposed policy would be funded.

The Special Adviser to the President on Information and Strategy, Bayo Onanuga, stated this in a release on Thursday titled, “Restoring petrol subsidies: Atiku’s volte-face and desperation for power.”

Onanuga said Atiku, who previously advocated the removal of fuel subsidy, had now “opportunistically recanted” his position ahead of the 2027 general elections.

Onanuga described the subsidy regime as “much-abused, wasteful, pillaged, corruption-ridden,” which he said had been made illegal from the end of June 2023, owing to the Petroleum Industry Act.

He noted that while it respects Abubakar’s constitutional right to propose alternative policies, the citizens deserved to understand the effects of the policy’s reversal.

“We respect Alhaji Atiku Abubakar’s constitutional right to propose alternative policies, to seek the support of Nigerians and recant a major policy prescription.

“However, Nigerians also deserve to understand what the proposed restoration of subsidy would actually mean, how it would be funded, and whether it is compatible with the legal and structural changes that have taken place in the petroleum sector,” he said.

The presidential aide cautioned that before the ex-VP’s idea deceives the masses, it’s high time the presidency subjects the “promise to a serious examination, especially in the context of Nigeria’s present economic and petroleum realities.”

“Alhaji Atiku Abubakar, former Vice President and perennial candidate for the presidency of Nigeria, has finally revealed his economic plans to Nigerians, should he be elected as President by January next year.

“Against expectations that he would announce a more creative and ingenious alternative to the programme being executed by the Tinubu administration, Atiku Abubakar behaved like a man from an archaic past who least comprehends the present economic dynamics and suggested that he would restore the much-abused, wasteful, pillaged, corruption-ridden fuel subsidy regime, which the Petroleum Industry Act made illegal from the end of June, 2023.

“Even though he used to believe that the subsidy regime must be eliminated, a point he canvassed in the run-up to his defeat in the 2023 election, he has now opportunistically recanted the major plank of his economic doctrine and turned a renegade.

“It is not difficult to explain why Atiku has latched onto the abandoned subsidy regime, five months to the election. Desperate for power, he needed to make a promise that he knew, if he were candid with our people, does not make fiscal sense, is retrogressive, and is against the genuine interest of the people.

“But before his suggestion hoodwinks the people, we must quickly subject the promise to a serious examination, especially in the context of Nigeria’s present economic and petroleum realities,” the statement partly read.

Onanuga clarified that the subsidy was a discount offered by the Nigerian National Petroleum Limited to the government.

However, the national oil company, according to Onanuga, is still owed trillions of Naira by the FG.

He added further that, while the subsidy removal was scheduled to be effective by the end of June 2023, the President only “accelerated it by weeks to stop further bleeding before the due date.”

“First, we must clear some ambiguities about the so-called subsidy. It is not some money sitting in the treasury to be disbursed to offer cheap fuel to Nigerians. It is the massive discount the NNPC offered the Nigerian government: selling fuel it bought at N100 at N50 at the pump, leading to under-recovery of costs and massive losses.

“Somewhere in the NNPC books are still trillions of Naira in subsidy costs that the Nigerian government has not paid. Contrary to Atiku’s claim in his interview, no N30 trillion subsidy windfall or savings exists anywhere except in his imagination.

“The petrol subsidy regime that Nigerians knew before May 2023 was dismantled as part of the country’s petroleum-sector reforms. The Petroleum Industry Act established a new framework for the downstream petroleum market.

“It removed the subsidy, as was previously done for diesel, kerosene and aviation fuel, ending a system that had placed a substantial and often unpredictable burden on public finances. The PIA scheduled the subsidy removal by the end of June 2023. President Tinubu only accelerated it by weeks to stop further bleeding before the due date,” read the statement.

He noted that Abubakar’s proposal signals a “reversal of current local production, and it will spell bankruptcy for smaller local refineries like Aradel’s, causing attendant job losses and a loss of foreign exchange.”

He added that the current policy has restored the nation’s pride, as opposed to the period when Abubakar and former President Olusegun Obasanjo were in power.

The statement continued, “Restoring the old arrangement, therefore, cannot simply be presented as a matter of announcing that government will once again pay part of the cost of petrol. It would require a clear legal, fiscal and administrative framework, including identifying the source of the funds and determining how such a policy would be implemented under the present petroleum-market structure.

“More importantly, Nigeria’s petroleum landscape has changed significantly since May 2023. For many years, the country relied heavily on imported petrol, with the government bearing the consequences of the gap between the regulated pump price and the cost of supplying the product.

“Today, the emergence of substantial domestic refining capacity has fundamentally altered that equation. The Dangote Refinery has become a major source of locally refined petrol. Indeed, the Dangote Refinery would not have kickstarted production for local consumption were the subsidy regime operative. This is an important point that Atiku deceptively ignored.

“Atiku’s proposal portends a reversal of current local production, and it will spell bankruptcy for smaller local refineries like Aradel’s, causing attendant job losses and a loss of foreign exchange. Because the sector is now market-driven, Nigeria now exports refined products to Europe, Asia, and the United States, restoring national pride.

“This development is a sharp contrast to when Obasanjo and Atiku were in power: Nigeria’s largest import, costing about $10 billion, was refined products!. President Tinubu has flipped that to Nigeria’s advantage.

“The N15 trillion that would have been borrowed and spent on selling discounted petrol has now significantly gone into the coffers of the three tiers of government. Now all states are fiscally stable and can pay salaries regularly and embark on infrastructure projects. In July, the three tiers shared about N3 trillion, a record, from the federation account. That is a major achievement, since the abolition of petrol price discount and distortions in the foreign exchange regime.”

Onanuga queried who would be responsible for payments if the subsidy policy was reversed.

“In practical terms, therefore, Nigerians should ask a straightforward question: If the subsidy is restored, who pays for it? What will the new pump price be? N200 or N500? If petrol is sold below its economic cost, which is about N1,200 to N1,300, someone must absorb the difference.

“Ultimately, that cost falls on the public finances—through reduced funds for infrastructure and social services, reduced allocation to states and 774 local councils, increased borrowing, higher public debt, or some combination of these,” he added.