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HomeHeadlinesNigeria may spend N18.397 bn daily on fuel subsidy payment in 2023...

Nigeria may spend N18.397 bn daily on fuel subsidy payment in 2023 – Finance Minister

By Aaron Ossai and Disun Amosun

Finance Minister, Zainab Ahmed has said that a whooping sum of N18.397 billion has been projected for payment of fuel subsidy daily in 2023 fiscal year.

The Minister who appeared before the House of Representatives ad hoc Committee on subsidy regime said Nigeria cannot continue to reel under the burden of the astronomical petrol subsidy regime amounting to 6.79 trillion dollars between the years 2013-2021, adding that it was hightime a collective decision be taken whether to exit from the subsidy or continue.

She added that whatever line on subsidy regime the country decieds to take will not be unilaterally taken by President Mohammed Bihari or the present administration, but by a larger consultative forum.

Towards this end, the minister announced that such an expanded forum that will include relevant stakeholders, including leaders of all political parties is already in the offing having received FEC approval.

The Minister of Finance, Budget and National Planing Mrs Zainab Ahmed said Nigeria is currently paying N283 as subsidy on every litre of premium motor spirit (PMS) imported into the country by Nigerian National Petroleum Corporation (NNPC) Limited.

The Minister in her presentation at the Hearing announced a projected N18.397 billion fuel subsidy payment per day going by the present parameter and explained that “fuel subsidy is the difference between the pump price which is now fixed at 165 and the landing cost which we are projecting at an average of N448 per litre in 2023, even now the cost is around that.

“So, the PMS subsidy we are carrying today in the nation is around N283 per litre, that is what we are carrying, so it is the difference between the pump price and the landing cost of petroleum products in the country,” she told the lawmakers.

In his intervention, committee member Rep Isiaka Ibrahim queried the rationale behind NNPC’s deduction from source the sum of N1.66 trillion against the sum of N1.15 trillion paid to oil marketers in 2021, leaving an excess of N500 billion by fiat.

This led the Committee to request for documentary evidence of the beneficiaries of the N500 billion paid by NNPC, and In a swift reaction to the Minister’s submission, Hon. Aliyu who contested the formular for the computation of the fuel subsidy, said: “the N6.7 trillion required for 2022, why I’m disturbed is because the 2023 financial year is approaching by September, we will be expecting Mr. President’s budget submission, and the MTEF is already before the National Assembly.

Committee chairman Rep Ibrahim Aliyu in agreeing on the need to take a radical decision on the subsidy regime noted that it’s continued payment benefited more the elites and neighboring countries that benefits from smuggled petrol from nigeria, rather than the majority of Nigerians that feels little or no part of the subsidy payment.

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