Fuel Subsidy Removal and Fraud Accountability Challenges in the Nigerian Economy: Evidence from Federal, State, and Local Government Areas

Abstract

Fuel subsidy removal remains one of the most controversial economic reforms in Nigeria. While proponents argue it frees up government funds for infrastructure and social spending, critics contend that the process is riddled with fraud and lacks accountability. This paper critically examines the implications of fuel subsidy removal on Nigeria’s economy, with a focus on how fraud and poor accountability mechanisms at the Federal, State, and Local Government levels exacerbate economic instability. Using mixed data from government records, audits, and stakeholder interviews, the study finds that the absence of transparent frameworks and institutional oversight has led to widespread misuse of savings from subsidy removal. Recommendations include strengthening fiscal accountability systems, independent audits, and decentralizing petroleum revenue usage to improve governance outcomes.

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