The Minister of Finance, Zainab Ahmed, has said that the Federal Government made provisions for fuel subsidy in the 2022 budget, beginning from January to June, and that all payments on fuel subsidy would cease as from July 2022.CONTINUE FULL READING>>>>
The Minister stated this Monday in Abuja during a meeting with top government functionaries, including the Minister of State for Petroleum Resources, Timipre Sylva; and Ahmad Lawan, President of the Senate, over the planned removal of subsidy on petroleum products by the Federal Government.
“Let me start by stating the fact that we did make a provision in the 2022 budget for fuel subsidy from January to June. And that suggests that from July there would be no fuel subsidy”
She further observed that in view of the timing, which is “problematic,” the Federal Government decided to suspend its plan to go ahead with the removal of subsidy on petroleum products in July, particularly against the backdrop of outcomes from ongoing consultations.
The Federal Government, Ahmad added, is presently exploring alternatives to premium motor spirit as well as pushing to step-up the country’s crude oil refining capacity. She disclosed that efforts are also underway by the executive arm of government to forward a request to the National Assembly to make additional provision for fuel subsidy from July this year till a time deemed appropriate for its eventual removal.
“Let me start by stating the fact that we did make a provision in the 2022 budget for fuel subsidy from January to June. And that suggests that from July there would be no fuel subsidy,” the Minister affirmed.
According to her, “this provision was made sequel to the passage of the Petroleum Industry Act that has made a provision that all products will be deregulated.
“Subsequent to the passage of the Act, we went back an amended the Fiscal Framework that was submitted to the National Assembly to incorporate this demand, but after the budget was passed we have had consultations with a number of stakeholders.”
The Minister noted that it became clear that the timing was problematic, that practically there is still heightened inflation, and also that removal of subsidy will further worsen the situation, thereby imposing more difficulties on the citizens, a situation that President Buhari clearly does not want.
In her own words, “what we have to do now is to continue with the discussions we are making, in terms of putting in place a number of measures, one of which is the deployment of an alternative to the premium motor spirit (PMS) and also the roll out of enhanced refining capacity in the country, including the 650,000-barrel-per-day Dangote Refinery and also the rehabilitation of the four national refineries that have a combined capacity of 450,000 barrels per day.
“The increased refining capacity in the country means we will need to import less products. But also as we are discussing right now within the executive the possibility of amending the budget, we may need to come back to the National Assembly by way of amendment to make additional provision for fuel subsidy from July, 2022, going forward, or to whatever period that is agreed as the right time.
Ahmad also said that the government is still exploring ways and means through discussions with various stakeholders in the executive, as well as the civil society and labour unions to explore ways by which subsidy removal would be addressed in a manner that is graduated and will have as minimal impact on the citizens as possible.
“So, we will come back to make further amendments on the fiscal framework as well as in the 2022 budget,” the Minister concluded.CONTINUE FULL READING>>>>
