Minister of Finance, Budget and National Planning, Zainab Ahmed, has said that about 40 million “deserving” Nigerians would get N5,000 per month as a transportation grant after the removal of fuel subsidies.
Ahmed said th isttoy at the launch of the World Bank Nigeria Development Update in Abuja.
She said, “The subsidies regime in the [oil] sector remains unsustainable and economically disingenuous.
“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 the potential negative impact of the removal of the subsidies on the most vulnerable at the bottom 40% 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.”
Ahmed also expressed hope that the Petroleum Industry Act 2021, the reactivation of public refineries, and the expected opening of three new private refineries in 2022 would boost economic growth.
She added that the social protection policies presented by Covid-19 allowed the government to safeguard the welfare of the country’s poor.
“We are very optimistic that the recent developments in the oil sector, such as the Petroleum Industry Act 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, would significantly boost contribution from the sector to our economic growth efforts.
“I agree with the report that with the expansion of social protection policies during the pandemic, the government has an opportunity to phase out subsidies such as the PMS subsidy while utilizing cash transfers to safeguard the welfare of poor and middle-class households,” the minister added.
According to the World Bank update, the poorest 40% of people in Nigeria consume less than 3% of the total available Premium Motor Spirit in the country, noting that the rich benefitted more from the subsidies.
However, the Minister stated that the total number of beneficiaries would depend on the resources available to the government after the fuel subsidies have been removed.
Ahmed also noted that the removal is set for June 2022, but hoped that it would be done before June, to be in line with the PIA.