Friday, the Federal Government announced that it has not halted the elimination of petroleum subsidies in Nigeria.
Minister of Finance, Budget and National Planning, Zainab Ahmed, disclosed on Thursday that the government had suspended the scheduled removal of petroleum product subsidies by the end of President Muhammadu Buhari’s administration. The latest position contradicts this disclosure.
Ahmed had explained at the conclusion of the National Executive Council meeting that the removal of the subsidy would likely go into effect in June because the Petroleum Industry Act, PIA, and the 2023 budget provided subsidies until June, so any delay could necessitate an amendment to the PIA and budget provision.
In a statement signed on her behalf by her Special Adviser, Media & Communications, Yunusa Tanko Abdullahi, on Friday, Ahmed stated that the Federal Government is not suspending the removal of the petrol subsidy.
She stated that the government had expanded the committee to include representatives from the incoming administration and state governors.
In response to media reports that the federal government had suspended the removal of petrol subsidies, the government issued the following statement: “Instead of suspending the removal, the government has expanded the subsidy removal committee to include teams from the incoming administration and the state governors.
“The Honourable Minister of Finance, Budget, and National Planning, Mrs. Zaniab Ahmed, stated that the National Economic Council (NEC) deliberated at length on the issue and reached the conclusion that the subsidy must be removed because it is unsustainable, but there is a need for further consultations, particularly with the incoming administration and State government representatives.
“We agreed to form a larger committee that will examine the procedure for the removal of the subsidy, including the determination of the exact date and the measures necessary to provide assistance to the poor and the vulnerable.
“Additionally, alternative measures must be agreed upon in order to ensure that the country has a sufficient supply of petroleum products. Current members of the Subsidy Removal Committee include the Ministry of Finance, Budget and National Planning, the Ministry of Petroleum Resources, the Nigerian National Petroleum Company (NNPC) Limited, the downstream and upstream regulators, the Central Bank of Nigeria (CBN), and the Chief Economic Adviser to the President.
“Both the 2023 Fiscal Framework and Appropriations Act and the Petroleum Industry Act (PIA) stipulate that the government must cease providing petroleum subsidies by June 2023. The committee will devise a plan for eliminating the subsidy. By June 2023, no change in the overall policy trajectory regarding the petrol subsidy is anticipated.”