The Nigerian Minister of Finance, Budget and National Planning, Zainab Ahmed, clarified that the federal government has not suspended the planned removal of petroleum subsidy, which is set to take place from June 2023. Ahmed’s statement came in response to media reports that the government had suspended the subsidy’s removal.
She explained that the National Economic Council had recommended the postponement of the subsidy’s removal until all necessary preparations with various segments of the government, including states and the incoming administration, were concluded. However, the government would instead expand the subsidy removal committee to include teams from the incoming administration and state governors.
The committee will determine the process for the subsidy’s removal, including the timing, alternative measures to be put in place to ensure adequate petroleum supply, and support for the poor and vulnerable.
The Subsidy Removal Committee currently comprises the Ministry of Finance, Budget and National Planning, Ministry of Petroleum Resources, Nigerian National Petroleum Company (NNPC) Limited, the downstream and upstream regulators, Central Bank of Nigeria (CBN), and the Chief Economic Adviser to the President.
The 2023 Fiscal Framework and Appropriation Act, as well as the Petroleum Industry Act (PIA), have made provisions for the government’s exit from fuel subsidy by June 2023, and the committee will work out a roadmap for the subsidy’s removal.
Ahmed reiterated that the subsidy’s removal was not sustainable, and the impact on ordinary Nigerians needed to be mitigated as much as possible. She also noted that the removal would require looking at alternatives and support for those most affected. The minister emphasized the need for the government to engage with petroleum marketers and revisit the Appropriation Act and the PIA if the removal of the subsidy extends beyond June.