Pres. Buhari To Spend N6.7 trillion On Fuel Subsidy In 12 months

Petrol subsidy will consume N6.7 trillion in 2023, the Minister of Finance, Budget and National Planning, Zainab Ahmed, has revealed, as suspension of removal remains in place.

Ahmed said the payment of petrol subsidy is determined by two factors; business-as-usual or reform, with the former estimated to cost the government N6.7 trillion, while the latter is N3.36 trillion.

She made this known during the presentation of the 2023-2035 Medium Term Expenditure Framework & Fiscal Strategy Paper (MTEF&FSP) in Abuja, on Thursday.

Recall that the Federal Government had announced plan to remove fuel subsidy this year, however, with inflation affecting food prices and fuel, President Muhammadu Buhari postponed the removal in January for 18 months.

This means the possibility of fuel subsidy removal will now rest on the incoming administration after the 2023 election, which will hold in February. However, before then, the government will have spent a projected N6.7 trillion, above the N4 trillion estimated for this year.

Speaking during the presentation, Ahmed said, “Scenario 1 – the Business-as-Usual scenario: This assumes that the subsidy on PMS, estimated at N6.72 trillion for the full year 2023, will remain and be fully provided for.

“Scenario 2 – the Reform scenario: This assumes that petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2021, in which case only N3.36 trillion will be provided for.” She revealed.