The Federal Government has announced the suspension of its plan to remove petroleum product subsidies by the end of President Muhammadu Buhari’s administration.
The decision was made during the National Economic Council (NEC) meeting held at the Presidential Villa in Abuja, which was presided over by Vice President Yemi Osinbajo.
According to the Minister of Finance, Budget, and National Planning, Mrs. Zainab Ahmed, who briefed State House correspondents after the meeting, the timing for the removal of the petrol subsidy should no longer be June as previously planned.
She added that all preparatory works should continue in consultation with the states and other key stakeholders, including representatives of the incoming administration.
The decision to suspend the subsidy removal plan was made just two months before the scheduled time for the removal of the costly petrol subsidy, also known as under-recovery.
Last year, following an N3.35 trillion subsidy budget, the federal government announced that it would stop under-recovery payments in June 2023.
Speaking at the NEC meeting on Thursday, Zainab Ahmed said that “the council agreed that the fuel subsidy must be removed earlier rather than later because it is not sustainable”. She emphasized that the subsidy removal has to be done in a way that mitigates the impact on the lives of ordinary Nigerians as much as possible.
“So, this will require looking at alternatives to the post-subsidy that needs to be planned for and subsequently put in place but also what needs to be done to support the people that would be most affected as a result of the removal,” the minister said.
“So, we will be working together with representatives of the state, we will have a plan that we will start working on putting the building blocks towards the eventual removal of the fuel subsidy.
“If I may remind the forum, that the budget for 2023 has provision for subsidy only up to June 2023 and also the Petroleum Industry Act (PIA) has a provision that requires that all petroleum products must be deregulated 18 months after the effective date of the PMs removal and that period is also up to June 2023.”
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