By Francis Ogwo
The Federal Government has disclosed that there is no provision for fuel subsidy in the revised 2020 budget.
President Muhammadu Buhari made this assertion in the First Year Ministerial Performance Review Retreat, at the State House on Monday adding that Nigeria cannot afford the cost.
Recall that in July, the Nigerian National Petroleum Corporation (NNPC) had, according to reports, spent over N535.9 billion on subsidy and Federation Account Allocation Committee in the first quarter of 2020.
This was followed with the Minister of State for Petroleum Resources stating also that it was huge cost for the government to continue with the subsidy regime, especially with the Premium Motor Spirit (PMS) otherwise known as petrol, as it was of no economic value to continue doing so.
In the Minster’s words: ‘’It has become expedient for the Ministry of Petroleum to explain misconceptions around the issue of Petroleum Products Deregulation. After a thorough examination of the economics of subsidizing PMS for domestic consumption, the government concluded that it was unrealistic to continue with the burden of subsidizing PMS to the tune of trillions of Naira every year.’’
Fast forward to today in Abuja, at the meeting, President Buhari said there are numerous implications on the government returning to the role of fixing or subsidizing prices.
“First of all, it would mean a return to the costly subsidy regime. Today we have 60% less revenues; we just cannot afford the cost. The second danger is the potential return of fuel queues – which has, thankfully, become a thing of the past under this administration.
“Nigerians no longer have to endure long queues just to buy petrol, often at highly inflated prices. Also, as I hinted earlier, there is no provision for fuel subsidy in the revised 2020 budget, simply because we are not able to afford it, if reasonable provisions must be made for health, education and other social services. We now simply have no choice,” President Buhari added.
