The Minister of Finance, Zainab Ahmed, has said that President Muhammadu Buhari has fixed June 2023 as the date for the removal of fuel subsidy.
The minister disclosed this while addressing the House of Representatives ad hoc committee investigating the fuel subsidy regime from 2013 to 2022.
She explained that if Mr Buhari’s government continues with the subsidy, the country will spend N6.4 trillion annually.
“One thing that stands out in the Medium Term Expenditure Framework was that if the nation holds on to fuel subsidy as it is designed now, we will be incurring from January to December a subsidy cost of N6.4 trillion,” Zainab said.
“But we suggested to the Federal Executive Council, and the council approved that, maybe, we could look at the option of exiting the subsidy (regime) half year. So, if we did that, then the cost would be N3.35 trillion, which is half of the N6.7 trillion.”
According to her, FEC approved the second option.
“That is the option that was conveyed by His Excellency, the President, to the National Assembly. But let me also say that even though this is a reduced option, it would mean that we are borrowing more than we would have borrowed if we did not have fuel subsidies,” Ms. Ahmed further explained. “In 2022, we are carrying the cost of subsidy throughout the whole year.”
Ms. Ahmed also mentioned that the N3.35 trillion proposed for servicing subsidies in 2023 until June, as outlined in the approved MTEF, was being considered by the National assembly.
She said the subsidy funds could have been used to assist other critical sectors such as social protection, health care, and education.
President Buhari’s regime had said last November that it would remove fuel subsidy by June this year and provide “deserving” Nigerians with a N5,000 monthly transport allowance, a move which the NLC had laughed at.
Buhari had then approved an 18-month suspension of the planned removal of fuel subsidy at the start of the year.
