Fuel subsidy to gulp N5.4tn this year, says FG

Fuel subsidy to gulp N5.4tn this year, says FG

The Federal Government has said a total of N5.4 trillion is earmarked for fuel subsidy this year (2024).

The amount is N1.8 trillion higher than N3.6 trillion budgeted for the same intervention in 2023.

The report of fuel subsidy budget this year is coming as a surprise against the proclamation by President Bola Tinubu during his inaugural speech that “fuel subsidy is gone”.

The administration had also repeated denied paying subsidy on fuel, especially when it was discovered that the landing cost of petrol was higher than the final pump price.

The Nigerian National Petroleum Corporation Limited has been a sole importer of fuel, distributing to both major and independent marketers. It must have therefore been incurring the additional cost.

Indeed, a draft copy report of the Accelerated Stabilization and Advancement Plan (ASAP) presented to President Tinubu by the Finance Minister, Wale Edun, on Tuesday showed that the estimated expenditure on fuel subsidy for 2024 is N5.4 trillion.

The ASAP was designed to address key challenges affecting the reform initiatives and stimulate development in various sectors of the economy.

“At current rates, expenditure on fuel subsidy is projected to reach ₦5.4 trillion by the end of 2024.

“This compares unfavourably with ₦3.6 trillion in 2023 and ₦2.0 trillion in 2022,” a draft copy of the ASAP presented by Edun stated.

In December, the government said contrary to the claim by the World Bank that the government was still paying subsidy on petrol, the era of petrol subsidy was gone for good.

Speaking in an interview on Channels TV, Minister of Information and National Orientation, Mohammed Idris, had said President Tinubu made it clear from his first day in office that his government would not sustain the payment of subsidy on petrol.