Nigeria’s Minister of Finance, Budget and National Planning, Zainab Ahmed, has said with Nigerian National Petroleum Company (NNPC) remitting almost zero to the federation, the government can no longer sustain petroleum subsidy cost which currently stands at about N250 billion monthly.
The Minister while justifying why the subsidy must be removed by 2022 and replaced with a N5,000 a month transportation grant to the poorest Nigerians, said it was no longer sustainable.
According to Ahmed; “The Petroleum Industry Act has a provision that all petroleum products must be deregulated. And in the 2020 budget, we made a provision to assume that at the maximum by the end of June, we must exit the subsidy.
“So, this last FAAC the subsidy cost to the Federation was N243 billion. So if we look at a cost of about 250 billion per month, and it has been increasing consistently. So we’re expecting something around N120 billion per month from NNPC.
“And now we’re getting to a point where NNPC is remitting near zero. And if we don’t stop we will get to a point where they will tell you to pay me this for managing the fuel provision in the country.”
The Finance Minister emphasized that if the government continues N250 billion a month on subsidies, it would spend about N3 trillion a year on that.
Source: Voice of Nigeria