Fuel subsidy removal: A reoccurring debacle
The back and front surrounding fuel subsidies removal or continuity had been a reoccurring debacle within Nigeria’s public space. Despite the country being a leading crude oil producing Nation, dependence on fuel importation continued to gulp almost half its annual budget.
Economic Experts have not hidden their disdain for the wastage dubbed fuel subsidies payment, however, organised labour, led by the Nigeria Labour Congress, Trade Union of Nigeria are ready to battle the government on the mention of subsidy removal. From time to time, since the return of Democracy in 1999, the issue of fuel subsidy removal has been an intense subject of debate.
President Muhammadu Buhari’s administration had hinted on subsidy removal in June. However, on Thursday there was a new twist, the National Economic Council, headed by the Vice President, Prof Yemi Osinbajo suspended the idea of fuel subsidies removal by the Buhari’s administration.
Nigeria’s Minister of Budget and National Planning, Zainab Ahmed, who had been pushing for the fuel subsidies removal with the insights that the Country would save close to N7 trillion, surprisingly threw in the towel, suspended the plan.
The council however agreed on the need to continue the discussion on the matter and the necessary preparatory work in conjunction with states and representatives of the incoming administration.
“Council agreed that the timing of the removal of fuel subsidy should not be now. But that we should continue with all of the preparatory works that need to be done and that this preparatory has to be done in consultation with the states and other key stakeholders including representatives of the incoming administration,” she said.
“Council agreed that the fuel subsidy must be removed earlier rather than later because it is not sustainable. We cannot afford it anymore. But we have to do it in such a way that the impact of the subsidy is as much as possible, mitigated on the lives of ordinary Nigerians.
“So, this will require looking at alternatives to the fuel subsidy that needs to be planned for and subsequently put in place. But also what needs to be done to support the people that will be most affected as a result of the removal.”
In line with Minister’s position, Nigerian NewsDirect in this editorial writes that the whole issue concerning fuel subsidy removal should be left to Bola Ahmed Tinubu’s administration.
The outgoing government need not initiate what it would be available to see through.
In this view, this paper believes that the fuel subsidies removal or continuity should be a cross for Tinubu and his government to carry.
According to an Expert, allowing the incoming administration to take responsibility for fuel subsidy should be the default position since the current government has announced a budgetary provision for fuel subsidy up till June 2023 which also aligns with the position of the Petroleum industry Act as amended.
Nigerin NewsDirect notes that rather than stir another round of controversy and confusion concerning fuel subsidy the entire gamut of the matter ought to be left for the new administration.
To this end, our stand is that NEC’s announcement on the suspension of fuel subsidy was really unnecessary owing to the fact that the Buhari government has roughly one month left to exit.
The National Economic Council should avoid making policy pronouncements that may make or mar the new administration.
This being said, the incoming government must consult widely before it would take a stand on whether to remove fuel subsidies or not.
