The government has said it is working to manage the negative impact of the removal of fuel subsidy on poor citizens.
According to the Premium Times, the minister of Finance, Budget and National Planning, Zainab Ahmed, revealed this at the launch of the World Bank Nigeria Development Update (NDU) on Tuesday, the federal government will remove fuel subsidy and replace it with a monthly N5000 transport grant to poor Nigerians.
Mrs Ahmed, however, pointed out that the move is set for June 2022 but the federal government hopes to do it before June — in line with the Petroleum Industry Act (PIA).
She said: “The subsidies regime in the [oil] sector remains unsustainable and economically disingenuous,
“Ahead of the target date of mid-2022 for the complete elimination of fuel subsidies, we are working with our partners on measures to cushion potential negative impact of the removal of the subsidies on the most vulnerable at the bottom 40% of the population.
“One of such measures would be to institute a monthly transport subsidy in the form of cash transfer of N5,000 to between 30 – 40 million deserving Nigerians.
“We are very optimistic that the recent developments in the oil sector, such as the Petroleum Industry Act (PIA) 2021, hopefully, the full reactivation of the 4 public refineries in the country, and the completion and coming on stream of the 3 private refineries under construction in 2022, would significantly boost contribution from the sector to our economic growth efforts,” Mr Ahmed added.
“I agree with the Report that with the expansion of social protection policies during the pandemic, the government has an opportunity to phase out subsidies such as the PMS subsidy while utilizing cash transfers to safeguard the welfare of poor and middle-class households.”
