Atiku Is Playing to the Gallery, and 15 Northern States Could Collapse if Subsidies Return, Don Warns

Restoring Nigeria’s petrol subsidy could cause more than 15 northern states to collapse within three months, according to Tunji Ogunyemi, a professor at Obafemi Awolowo University.

Ogunyemi issued the warning during an interview on the Open Forum 360 podcast, while responding to African Democratic Congress presidential candidate Atiku Abubakar’s proposal to restore the subsidy if elected in 2027. He said the policy would reduce the money available for distribution through the Federation Account, on which most states depend to finance their operations.

“

I think it is calamitous, to say the least, if we reverse the subsidy regime in Nigeria in favour of returning the subsidies.

“I think it is calamitous, to say the least, if we reverse the subsidy regime in Nigeria in favour of returning the subsidies,” Ogunyemi said. He described the Federation Account as “the jugular of more than 30 states in the federation,” adding that only about four states could survive without it. He named Lagos, Delta and Rivers as states that could cope without heavy reliance on federal allocations, while citing Taraba as an example of a state highly dependent on the account.

Ogunyemi said a revenue squeeze would leave states unable to meet their obligations to workers and pensioners. “The second is that states will return to a regime of incapacity to pay salaries, let alone pensions,” he said.

“

The Federation Account is the jugular of more than 30 states in the federation. Only about four states in Nigeria can survive without the Federation Account.

He also warned that the federal government would struggle to fund both recurrent and capital spending if its share of revenue declined. Between 60% and 70% of federal expenditure goes to recurrent spending, which he described as “consumption expenditure.” Lower revenue, he said, could prevent the government from meeting even minimum spending needs, while also affecting debt servicing and Nigeria’s financial standing and creditworthiness.

Ogunyemi questioned whether Atiku’s proposal was intended to win political support, arguing that the former vice president should explain more clearly the consequences of restoring the subsidy. Atiku has said Nigerians have not seen sufficient benefits from its removal and has questioned how the resulting funds were used.

“

The second is that states will return to a regime of incapacity to pay salaries, let alone pensions.