The Federal Government spent N9.39 trillion on wage adjustments, minimum wage increases and allowances for public sector workers between June 2023 and December 2025, exceeding the N5.4 trillion it received as its share of savings from the removal of the petrol subsidy.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Wednesday during a Channels Television media briefing on the Federal Government’s economic reform programme.
Oyedele said the figures reflected the significant financial obligations created by the government’s economic reforms since President Bola Tinubu assumed office, noting that the Federal Government generated about N20.4 trillion in additional resources during the 31-month period.
According to him, the additional resources came largely from petrol subsidy savings, increased independent revenue and additional borrowing. However, he said the resources were substantially absorbed by increased government expenditure and other financial obligations.
The minister put the government’s total incremental expenditure during the period at N30.64 trillion, with wage-related expenses alone accounting for N9.39 trillion. He explained that the increase was driven by wage adjustments and the implementation of the new national minimum wage.
Oyedele also disclosed that the Federal Government spent N9.37 trillion servicing external debt within the same period. He attributed a significant portion of the increase in the naira cost of debt servicing to the depreciation of the local currency.
Explaining the impact of the naira’s depreciation, the minister said Nigeria’s foreign-denominated obligations are settled in dollars, meaning that a weaker naira requires significantly more local currency to service the same debt. He illustrated this by comparing an exchange rate of about N460/$ with the later rate of around N1,415/$.
Oyedele stressed that the government could not simply postpone its debt obligations because failure to meet them could have serious consequences for the country. His disclosure has further intensified debate over the deployment of petrol subsidy savings and the broader fiscal impact of the government’s economic reforms, amid competing demands from workers’ wages, debt servicing and other public expenditure.
