Lawmakers Move To Remove Another Subsidy After Petrol to Boost Government Revenue
- Nigerian lawmakers are pushing for the full removal of electricity subsidies to boost government revenue
- If this is achieve it is expected to increase how much Nigerians currently pay for power
- Senate Appropriations Committee chairman Adeola Olamilekan said subsidy removal is critical to funding the 2026 budget
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The Senate Committee on Appropriations wants a complete removal of electricity subsidies to increase federal government revenue and reduce fiscal pressure.
The lawmakers made the call on Monday, February 9, 2026, during a public hearing on the 2026 budget proposal at the National Assembly.
Source: Facebook
Electricity subsidy removal
Addressing the session, the committee chairman, Adeola Olamilekan, who represents Ogun West Senatorial District, said power sector reforms must include ending electricity subsidies, describing them as a heavy burden on public finances.
He added that although the power sector has been unbundled and constitutional changes now allow states to generate electricity, the federal government still spends trillions of naira each year to support electricity tariffs.
He said:
“We need to finish the unbundling process and fully eliminate electricity subsidies. Although states can now generate power, subsidies still place a heavy strain on public finances and must be tackled to unlock more revenue.”
He argued that Nigeria’s annual revenue remains insufficient to fund the size of its budget, adding that continued subsidy payments further widen the fiscal gap.
Olamilekan asked:
“If current revenue cannot support the budget, we need to rethink our approach.
“Removing electricity subsidies will end trillion-naira payments and allow those funds to be redirected into government revenues to support the budget.”
Source: Twitter
He said the 2026 budget focuses on these reforms, calling it a “budget of consolidation,” and stressed that policies must be properly carried out and linked to programmes that help people.
For years, the government has subsidised electricity to keep costs down, a policy that costs trillions of naira each year.
Critics warn that ending the subsidy could push bills up, hit households hard, and raise costs for businesses.
Senate defends continued borrowing
During the hearing, Olamilekan also defended the government’s plan to borrow around N25.91 trillion to help fund the 2026 budget.
He said borrowing is common worldwide, even in developed countries, and argued that Nigeria cannot rely on monthly revenues alone to finance its budget.
He said:
“No government runs without borrowing. Revenue projections do not come in at once. Government must continue to function.”
He added that the government plans to raise funds from domestic banks, capital markets, and international sources, including Eurobonds, to cover the budget deficit.
Nigerian govt shares benefit of fuel subsidy removal
Earlier, Legit.ng reported that Wale Edun, finance minister and coordinator of economic policy, has revealed that President Bola Tinubu's administration's decision to scrap fuel and forex subsidies has helped the country save $20 billion.
He disclosed this while speaking at an event marking the 100th day of Esther Walso-Jack's tenure as Head of the Civil Service of the Federation.
Edun stated that the two petrol and foreign exchange subsidies had been draining 5% of the country’s GDP annually.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
