Economist, Residents React As Oyedele Says Households Spend 120% Of Income On Food

By BUKOLA ARO-LAMBO and DEBORAH BELLO, Lagos

Claims by the minister of finance and coordinating minister of the economy, Taiwo Oyedele, that some households spend as much as 120 per cent of their income on food have drawn mixed reactions from Nigerians, with an economist and residents split on the figure but united on the pressure of rising food prices.

Oyedele who spoke at Chatham House in London, said a government survey showed that some households spend more than they earn on food, forcing them to borrow.

“In fact, there was a survey we did that shows that up to 120 per cent of household income is spent on food. Like how do you spend 120 per cent of your income? You borrow food before the end of the month,” he said.

He said Nigeria’s poverty rate remained above 50 per cent despite an unemployment rate of about five per cent, pointing to the plight of Nigerians who have jobs but still cannot afford basic necessities.

“One important data that sometimes people misunderstand in Nigeria is unemployment rate is low. It’s about five per cent. Comparable to the UK, but the poverty rate is high, at over 50 per cent. That tells you something. As a policymaker, you don’t sit back and say, “We don’t have unemployment.” You have working poor,” he said.

Oyedele said the figures showed why the government must look beyond headline economic indicators and focus on the lived experiences of households. “Macroeconomic stability means little to a mother who still cannot afford food,” he said, acknowledging that food inflation remained a major concern despite the decline in headline inflation.

He put food inflation at 19.6 per cent in September, saying food prices were not easing as quickly as the broader inflation rate. “Headline inflation is falling faster than the price of a basket of tomatoes, gari, and beans. And this widens inequality,” he said.

The minister attributed persistent food inflation to low agricultural yields, seasonal farming, post-harvest losses, poor storage and logistics, the cost of transporting produce and insecurity in farming communities. He said Nigeria loses as much as 60 per cent of its tomato production to post-harvest losses, making investment in storage, transportation and agricultural productivity essential to bringing down food prices.

According to him, the government’s response focuses on increasing food supply through investments in agricultural technology, irrigation for year-round farming, storage facilities, rural roads, and security for farming communities. “We’re expanding access to finance for smallholders and small businesses who create most of our jobs,” he added.

He said the government’s cash transfer programme had reached more than 10 million households, with payments made digitally and beneficiaries verified through their National Identification Numbers.

“Our cash transfer programme has now reached over 10 million households, paid digitally and verified by national identity number, so that support reaches the people who need it, not the middlemen,” he said.

Oyedele said the administration was prioritising agriculture and non-tradable services after its analysis showed that 81.4 per cent of employed Nigerians worked in the two areas. The government, he said, wants to accelerate growth in those sectors beyond the overall economic growth rate to lift more Nigerians out of poverty and narrow inequality.

“So we are now putting effort in those two areas to accelerate the growth over and above the overall economic growth rate so that you leave them out of poverty, you close inequality and there will be no need any more for you to do cash transfers,” he said.

Reacting to the minister’s claim, A Professor of Law and development economist, Prof. Tayo Bello, while commending the government for acknowledging the realities facing most Nigerians, said the rising cost of fuel and the devaluation of the naira had eroded citizens’ purchasing power.

Bello said rising insecurity had also fuelled food inflation, as many food-producing states were operating below capacity. He urged the government to work towards easing citizens’ pain, recalling the discounted food market the Lagos State Government introduced some years ago to address the impact of rising poverty.

A public servant, Adedoyin Tanimowo, and a legal practitioner, Mercy Ola, said they did not agree with the figure, describing it as exaggerated, though both admitted that food prices were squeezing their spending on other needs.

A student, Esther Folasewa, said some households may even spend more than 120 per cent of their income on food.

A Nigerian resident, Owen Ogie, expressed concern about the rising cost of food, noting that many households struggle to afford basic items despite spending more. He said the situation had left families with less to spend on transportation, rent, healthcare, and other essentials, forcing them to cut expenses. Ogie called on the government to support local farmers, improve security and transportation, and reduce the cost of moving food from farms to markets. He also stressed the need to raise citizens’ incomes to keep pace with rising prices.

Tanimowo said spending varies according to income levels. She said rising food prices had forced her to cut back on leisure and miscellaneous expenses and rely more on public transportation. She urged the government to subsidise farm inputs, improve security for farmers, curb open grazing and establish direct farmers’ markets to reduce middlemen’s costs. She also called for better roads, reliable electricity and access to water to ease transportation, reduce food spoilage and make food more affordable.

Ola said that based on her experience and observations of those around her, she does not agree that households spend 120 per cent of their income on food. However, she noted that rising food prices had increased household spending on food, leaving other basic needs with limited attention. She said funds are now allocated to other essential needs only when absolutely necessary, and called on the government to stabilise the economy to ease the cost of food.

Folasewa said some households may spend more than 120 per cent of their income on food, sometimes borrowing to meet their feeding needs, which leads to accumulating debts. She noted, however, that additional sources of income can help some households cope. She urged the government to tackle inflation, reduce food costs, and increase workers’ salaries, and recommended creating more income-generating opportunities.