No going back on fuel subsidy removal, FG makes a U-turn

No going back on fuel subsidy removal, FG makes a U-turn

Less than 24 hours after the National Economic Council announced the suspension of the fuel subsidy removal, Minister of Finance, Budget and National Planning, Zainab Ahmed, says the Federal Government will go ahead with the initial removal plan.

She said NEC headed by Vice-President Yemi Osinbajo at their last meeting on Thursday never decided on subsidy removal suspension, but only agreed to expand the implementation committee.

On Thursday, the minister had reportedly said the National Economic Council (NEC) agreed to temporarily suspend the removal of petrol subsidy.

However, in a statement on Friday, Ahmed said the government had no such plans.

She said the latest plan was to expand the subsidy removal committee to include teams from the incoming administration and the state governors.

She said NEC deliberated on the issue extensively and came to the conclusion that subsidy must be removed, as it is not sustainable; but expressed need for further consultations, “especially the need to involve members of the incoming administration and representatives of the state governments”.

The minister stated, “We agreed to form an expanded committee that will be looking at the process for the removal of the subsidy, including determining the exact time as well as the measures that need to be taken to provide support to the poor and the vulnerable,” Ahmad was quoted by Yunusa Abdullahi, the minister’s special adviser on media and communications.

“There is also the need to agree to alternative measures that will be put in place to ensure that there is sufficient supply of petroleum products in the country.”

According to her, the subsidy removal committee currently comprises the Ministry of Finance, Budget and National Planning; Ministry of Petroleum Resources, Nigerian National Petroleum Company (NNPC) Limited, the downstream and upstream regulators, Central Bank of Nigeria (CBN), and the chief economic adviser to the president.

She also said the 2023 fiscal framework and appropriation act as well as the Petroleum Industry Act (PIA) had made the provision that the government should exit petrol subsidy by June 2023.

“The committee is to work out a road map for the removal of the subsidy. No change in the overall policy direction regarding the petrol subsidy is envisaged by June 2023,” the minister added.

Following a N3.35 trillion subsidy budget in 2022, the Federal Government said it would stop under-recovery payments in June 2023.

Already, the Federal Government has secured the sum of $800 million from the World Bank, as part of its post-subsidy palliative plans.

 

No going back on fuel subsidy removal, FG makes a U-turn