Subsidy removal: States’ revenues rose, but education, health spending fell — ADC’s Adio tackles governors
The combined revenues accruing to Nigerian state governments have risen from N4.8 trillion in 2022 to N15.5 trillion following the removal of petrol subsidy, but spending on education and healthcare as a proportion of state budgets has declined, African Democratic Congress, ADC, candidate for Lagos State House of Assembly, Eti-Osa Constituency 2, Ayo Adio, has said.
Adio questioned how governors have deployed the increased revenues, arguing that the major justification for subsidy removal was that additional resources would be channelled into infrastructure, education and healthcare.
Speaking during an interview on Arise TV, Adio said the proportion of state budget spending on education had fallen from 14 per cent to 12 per cent, while healthcare spending had declined from seven per cent to six per cent.
“The amount in terms of percentage of budget spending that has gone into education has actually shrunk from 14 per cent to 12 per cent. The combined amount in percentage terms of that revenue that has accrued to states for healthcare spending has shrunk from 7 per cent to 6 per cent,” he said.
Adio also said the number of states relying on loans to fund budget deficits had increased from 19 to 25, questioning whether the additional revenues had translated into improved public services.
“So, I ask you, what is working? What is working?” he asked.
He also questioned the level of infrastructure investment across the country, citing prolonged traffic and delays on major highways, including the Ore Expressway and routes linking travellers to Agbor, Ilorin and Kaduna from Abuja.
“When you travel across this country, you don’t need a prophet to tell you that not enough has gone into spending of infrastructure,” Adio said.
The ADC candidate argued that the increase in government revenues should prompt a review of how the resources are deployed, particularly in addressing the rising cost of living and production.
He backed targeted subsidies for local refiners, saying the government could provide crude to domestic refiners to improve efficiency and potentially reduce petrol prices.
Adio cited the use of targeted subsidies by countries including the United States and South Korea to support strategic industries.
“States across the world use targeted subsidies at production so that they can either become competitive to create jobs and in certain instances to pass lower costs to the end user on the last mile,” he said.
He said the rising costs of petrol, electricity, education and housing were placing additional pressure on households, and questioned whether Nigerians would benefit more from allowing governors to control increased revenues or from deploying part of the resources towards targeted industrial subsidies.
“Then you have to ask the fundamental question whether you want governors to be controlling the excess revenues that they claim that they have, or whether you want an industrial subsidy that guarantees lower prices for you at the pump,” he said.
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