The issue of subsidy removal has been the debate for a very long time, present and past governments had made attempts to remove the subsidy on petrol.
Common Nigerians have seen this move as a means to impoverish the majority of the citizenry leaving below standard in poverty.
But this is the step that the Buhari- administration has taken to improve the economy.
The NNPC boss had revealed that the removal of the subsidy on petrol will take effect at the end February.
Prominent amongst Nigerians to criticise the move by the FG is Kaduna based Senator, Shehu Sani.
What Will Happen If Petrol Price Becomes N340 Per Litre
Senator Shehu Sani, a former federal legislator from Kaduna state, has expressed his concerns about what Nigerians will face if petrol prices rise to N340 per litre.
Sani’ s declaration comes after the Nigerian National Petroleum Company Limited (NNPCGroup )’ s Managing Director and Chief Executive Officer said that after the subsidy is removed in 2022, the price of petrol might vary between N320 and N340 per litre.
The former senator wrote on his Facebook page about what will happen if the product is offered at such a high price.
” 1. Salaries or wages will be worthless,
- Landlords will increase the rent,
The schools will increase the tuition
and parents must pay,
- Food prices, transport, water and electricity bills will increase. “
Despite the fact that Zainab Ahmed, the minister of finance, budget, and national planning, has stated that the subsidy will be replaced with a N5000- per- month transportation allowance for the poorest Nigerians, Senator Sani has stated that the government’ s proposal will not fix ” all these problems. ”
Nigerians took to their Facebook account to drop their opinions as to the debate brought up by the Kaduna based senator, Shehu Sani. Below are some of the comments gathered by JoseyWrites.
@Aminu Mohammed detected false play by the Buhari- led federal government as he said;
” And if you multiply 5K by 40 million, it will be 200billion. Multiply that by 12 months, you get 2. 4 trillion. This amount is greater than what they pay for the subsidy at least by over 800 billion. They want to scam us again! 😭😭😭”
Another user Shally Magaji applauded the senator as she said;
” I think your thinking is beyond what Kaduna people want. #alwayswithyousenator”
@Abubakar Maharaja said;
” No mind the clueless rulers. ”
Another concerned Nigerian, Nura Mohammed had this to say;
FG to replace fuel subsidy With N5, 000 transport bonus for 40million Nigerians.
” Now let’ s do the calculations as Accountants
N5000 x 40M Nigerians = N200b monthly
N200b x 12 months = N2. 4Tr
Annual Fuel Subsidy 2021= N1. 8Tr
If you are to take decision what will be your decision as an accountant. . . . . ”
@Buhari Iliyasu said;
” This is the Ticket of failing to upcoming election of APC if this happen. ”
@Sa’ adu Halidu also commented thus;
” It’ s quite unfortunate for thos inhuman government we face at this critical time. . . . . . . ”
World Bank Advises FG To Remove Petrol Subsidy
Meanwhile, the World Bank released its November 2021 Nigeria Development Update on Tuesday, November 23.
According to The Cable, the analysis indicated that Nigeria no longer profits from high oil prices because of record low revenues and excessive fuel subsidies.
Nigeria has the lowest revenue- to- GDP ratio of the 115 nations analysed by the World Bank, according to the report.
According to details gathered by JoseyWrites, the World Bank has also encouraged Nigeria’ s government to eliminate the petrol subsidy, claiming that it benefits only the poorest Nigerians.
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The Bank, on the other hand, recommended the government to devise programmes to shield the poor from the effects of the subsidy elimination.
It also recommended that the government use the savings from the gasoline subsidy to fund primary health care, basic education, and rural connectivity projects.
Report Reveals Billions Of Naira Petrol Subsidy Gulped In 7 Months
However, according to the FAAC, petrol subsidy payments consumed N714 billion in the last seven months, reducing monthly revenue accrued to the federation account.
The underpriced sales of premium motor spirit (PMS), often known as gasoline, are the subsidy or under- recovery, according to the research.
From January to September, the report offered a month- by- month analysis of all payments made to oil marketers.
NNPC paid N25. 37 billion in February for the under- recovery of PMS/value deficit, according to a document documenting the national oil company’ s statement at the September 2021 Federation Account Allocation Committee (FAAC) meeting.
For the same objective, it spent N60. 39 billion in March, 61. 99 billion in April, N126. 29 billion in May, and N164. 33 billion in June.
This is the most significant element affecting federal allocations to government accounts.
NNPC Reveals How Much Nigerians May Pay For Litre Of Petrol After Subsidy Removal In 2022
Meanwhile, Malam Mele Kyari, the Nigerian National Petroleum Company Limited’ s (NNPC) Group Managing Director and Chief Executive Officer, has stated that Nigeria should be subsidy- free by the end of February 2022.
The NNPC boss said this at a World Bank Nigeria Development Update presentation titled ” Time for Business Unusual” in November 2021.
According to PM News, Kyari noted that from February 2022, there will be no legal provision for subsidy. He, on the other hand, stated that the Nigerian government has a greater social obligation to provide for the common man and that the subsidy regime will be phased down in the most delicate and painless manner possible.
After the subsidy is removed, the price of the product might range between N320 and N340 per litre, according to the NNPC boss.
FG To Replace Fuel Subsidy With N5, 000 Transportation Grant For 40M Nigerians
Meanwhile, Zainab Ahmed, Nigeria’ s minister of finance, budget, and national planning, has announced that the subsidy will be replaced by a monthly transportation stipend of N5000 for the poorest Nigerians.
According to Zainab, the award will benefit about 20 to 40 million Nigerians who are among the country’ s poorest.
The exact number of recipients, according to the minister, would be determined by the resources available when the fuel subsidy is eliminated.
According to the World Bank’ s latest development report, Nigeria’ s lowest 40% use less than 3% of the country’ s total PMS, indicating that the wealthy profit more from the subsidies.
Despite the fact that the shift is scheduled for June 2022, Ahmed stated that the federal government hopes to complete it sooner than that, in accordance with the Petroleum Industry Act (PIA).