The Minister of Budget and Economic Planning, Senator Abubakar Bagudu, has acknowledged that the economic reforms implemented by President Bola Tinubu’s administration have contributed to the rising cost-of-living pressures faced by Nigerians.

However, Bagudu maintained that the government would continue with the reforms, saying they were necessary to strengthen public finances, stabilise the economy and create the conditions for sustainable and inclusive growth.

According to a statement issued by the Federal Ministry of Budget and Economic Planning on Wednesday, Bagudu made the remarks while delivering a keynote address at the Federal Appointees Strategic Summit on the presentation and review of ministerial and Ministries, Departments and Agencies’ budget implementation.

“He acknowledged that the reforms, along with international economic pressures, had contributed to cost-of-living challenges and other pressures facing citizens, but maintained that the administration remained focused on achieving long-term economic stability and inclusive growth,” the ministry said.

The reforms included the removal of the petrol subsidy and changes to the foreign exchange market, two major policy shifts introduced after Tinubu assumed office in May 2023.

Bagudu said the decisions were taken amid significant economic challenges, noting that the government did not anticipate the scale of the turbulence that later affected the global economy.

He also identified global uncertainties, conflicts and disruptions to international trade and tariffs as additional factors driving food prices and worsening the broader cost-of-living pressures.

Despite the pressures on households, Bagudu said the reforms had improved the fiscal position of the three tiers of government by increasing the resources available to the Federal Government, states and local governments.

He said the increase in revenues accruing to subnational governments was consistent with Tinubu’s commitment to strengthening fiscal federalism and enhancing the capacity of states and local governments to fulfil their constitutional responsibilities.

“Rather than keeping additional revenues at the centre, the President has taken the position that we should give local governments and states more money and energise everyone so that we can interrogate and fulfil our responsibilities,” he was quoted as saying in the statement.

Bagudu also said the Federal Government had taken steps to settle outstanding financial obligations to states as part of efforts to strengthen the federation and improve public service delivery.

He noted that several states had previously struggled to meet their salary obligations despite relatively high international crude oil prices, while spending on infrastructure and essential public services remained limited.

The minister, however, cautioned that the progress recorded so far should not be considered sufficient, noting that Tinubu had continued to demand greater results from members of his administration.

He said the government remained focused on expanding domestic production and ensuring that improvements in macroeconomic conditions translated into better outcomes for Nigerians, particularly at the grassroots.