The Federal Government has suspended the planned petrol subsidy removal.
Speaking during a meeting held at the National Assembly in Abuja on Monday, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said the suspension is till further notice.
Last Friday, the National Economic Council (NEC) had promised that it would make a decision on the removal of fuel subsidy in June this year when provisions for its payment in the 2022 budget expires.
Many Nigerians, including former Head of State, General Abdulsalami Abubakar, warned against the withdrawal of petrol subsidy as it would push many Nigerians into poverty.
On Monday, the minister stated that the government had made provisions for subsidy in the 2022 budget from January to June this year, and that government will forward a request to the National Assembly to make additional provisions for fuel subsidy from July this year till a time deemed appropriate for its eventual removal.
According to her, all payments on fuel subsidy ordinarily would cease as from July, 2022.
She said, “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.
“This provision was made sequel to the passage of the Petroleum Industry Act, PIA, that has made provision that all products will be deregulated.
“Subsequent to the passage of the Act, we went back and 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.
“It became clear that the timing is problematic, that practically, there is still heightened inflation, and also removal of subsidy will further worsen the situation, thereby, imposing more difficulties on the citizens, and the President clearly does not want to do that.
“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 Premium Motor Spirit, PMS, and also the roll-out of enhanced refining capacity in the country, including the 650,000 barrels 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.
“Also, while we are exploring ways and means through discussions with various stakeholders in the executive as well as the civil societies and labour unions by which we can address this removal 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.”
