Minister of Finance, budget and national planning, Zainab Ahmed, has said the federal government has concluded every plan for the removal of the controversial subsidy on the premium motor spirit (petrol) and would not revisit the matter.
Against earlier reports, the minister said the current administration is not suspending fuel subsidy removal but simply expanding the existing subsidy removal committee to include the transition committee members of President-elect Bola Ahmed Tinubu and the state governors.
“As far as the minister is concerned, the issue of subsidy removal is done and dusted. What she told the president is that ‘we have an incoming administration; do you want to take that decision without them?’” the minister’s special adviser on media and communications, Yunusa Tanko Abdullahi, said in an exclusive chat with our correspondent.
“There is no provision for subsidy payment in the 2023 Appropriation Act beyond June. Subsidy payments gulped over N1.4 trillion in 2022. So, that committee that was looking at the subsidy removal has now been expanded to include the transition committee team so that they can look at it together with the state governors,” Abdullahi said, adding that the government is not contemplating a suspension of the subsidy regime.
The finance minister also disclosed that the National Economic Council (NEC) had agreed that the timing for the removal of the subsidy should not be now but that all of the preparatory works should continue in consultation with the states and other key stakeholders, including representatives of the incoming administration.
Zainab Ahmed disclosed this to State House correspondents yesterday after a meeting of the National Economic Council (NEC) presided over by Vice President Yemi Osinbajo at the Presidential Villa, Abuja.
According to her, the council agreed that subsidies must be removed earlier rather than later, and alternatives need to be planned and put in place to mitigate the impact on ordinary citizens.
The minister further explained that an expanded committee was formed to determine the exact time and measures to be taken to provide support to the poor and vulnerable and ensure a sufficient supply of petroleum products.
She said the committee will engage with representatives from the incoming administration and key stakeholders.
According to her, 2023 has provision for the subsidy only up to June 2023, and the Petroleum Industry Act requires that all petroleum products must be deregulated 18 months after the effective date of the subsidy removal, which is also up to June 2023.
According to her, the removal of the subsidy will not be done before the transition is completed, but if the committee determines that the removal can be done by June, then the plan will be designed to exit as a tool.
“Council agreed that the first subsidy must be removed earlier rather than later because it is not sustainable. We cannot afford it anymore. We have to do it in such a way that the impact of the subsidy is as much as possible mitigated on the lives of ordinary Nigerians.
“So, this will require looking at alternatives to the post-subsidy that needs to be planned for and subsequently put in place but also what needs to be done to support the people that would be most affected as a result of the removal.
“So, we will be working together with representatives of the state; we will have a plan that we will start working on putting the building blocks towards the eventual removal of the fuel subsidy,” she said.
