The Minister of Finance, Budget and National Planning, Zainab Ahmed, has announced that the Federal Government will remove the fuel subsidy and replace it with a monthly N5000 transport grant for underprivileged Nigerians.
“The subsidies regime in the [oil] sector remains unsustainable and economically disingenuous,” Mrs Ahmed said at the launch of the World Bank Nigeria Development Update on Tuesday.
“Ahead of the target date of mid-2022 for the complete elimination of fuel subsidies, we are working with our partners on measures to cushion potential negative impact of the removal of the subsidies on the most vulnerable at the bottom 40 per cent of the population.
“One of such measures would be to institute a monthly transport subsidy in the form of cash transfer of N5,000 to between 30 – 40 million deserving Nigerians.”
According to the latest numbers, the government spends trillions of naira annually on subsidies on petroleum products.
“We are very optimistic that the recent developments in the oil sector, such as the Petroleum Industry Act (PIA) 2021, hopefully, the full reactivation of the four public refineries in the country, and the completion and coming on stream of the three private refineries under construction in 2022,” the minister added.
Mrs Ahmed said that although the plan is scheduled for June 2022, FG hopes to implement it before June — in line with PIA
Many Nigerians, however, reject the notion of removing fuel subsidies since that is the only benefit they receive from the country’s rich oil reserves.
