Fakoyejo OlalekanPresident Bola Tinubu has announced that the fuel subsidy is gone, stating that there will be no provision for it in his government’s budget.
Tinubu said this during his inauguration speech on Monday, 29 May 2023. He reiterated his stance against the subsidy, stating that the money could be invested in other sectors.
He said the poor households in Nigeria don’t benefit from fuel subsidy, rather, it favours the rich in Nigeria, so there’s no reason to justify the amount spent to subsidise petrol prices amid declining revenue.
“We commend the decision of the outgoing administration in phasing out the petrol subsidy regime which has increasingly favoured the rich more than the poor.
“Subsidy can no longer justify its ever-increasing costs in the wake of drying resources,” Tinubu said during his inauguration speech.
According to the president, the subsidy budget would be invested in public infrastructure, education, health care and jobs.
“We shall instead re-channel the funds into better investment in public infrastructure, education, health care and jobs that will materially improve the lives of millions.”
Tinubu’s subsidy removal set NLC showdown
The Nigeria Labour Congress (NLC) has previously spoken against the removal of subsidy before Nigeria’s refineries are repaired for operation.
Nigeria doesn’t have a working refinery aside from the newly commissioned Dangote Refinery, which is not expected to distribute fuel until July ending and early August.
Tinubu didn’t reveal his palliative measures after the removal of subsidy during his speech on Monday, neither did he disclose if he will consult the labour union before the official removal slated for June 2023.
NLC’s decision to protest the removal forced Buhari’s government to abandon its subsidy removal plan in January 2022, compelling him to leave the decision for Tinubu to decide.
Recall that Buhari’s administration only budgeted for subsidy between January to June, stating Tinubu will decide if the subsidy should be phased out or extended till December 2023.
The outgoing Finance Minister, Zainab Ahmed, said a month ago: “it is not going to be removed now, which means it will not be removed before the transition is completed. But then we have two laws that have inadvertently made the provision that we should exit by June.
“So, if the committee’s work, which will include the representatives of the incoming administration, determined that the removal can be done by June, than (sic) the work plan will be designed to exit as at June.
“But if the determination is that the period is extended it will mean that as a country, we will have to revisit the appropriation act for example, because the 2023 budget only [made] provision up to June.
“So, if we’re extending beyond June it means we have to revisit the appropriation act or amend the PIA. So, these are the reasons why we had to do this consultation, to get inputs from the government. They’re going to provide us their representatives to work together with us to have a defined process that will take us towards the removal,”
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