Oil & Gas

FG to remove fuel subsidy in 2022, replace it with N5,000 transport stipend for Nigerians

Access Bank
Minister of Finance, Budget and National Planning, Zainab Ahmed, has revealed that the Federal Government would remove fuel subsidies by 2022.

In place of the fuel subsidy, Zainab Ahmed said the Federal Government introduce a N5000-a-month transportation grant to the poorest Nigerians.

The minister spoke at the launch of the World Bank Nigeria Development Update (NDU), on Tuesday, where she make the disclosure.

She said the grant would go to about 30 to 40 million Nigerians who make up the poorest population of the country.

She said the final number of beneficiaries will depend on the resources available after the removal of the fuel subsidy.

Said she, “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.”

The World Bank in the development update had said the poorest 40% in Nigeria consume less than 3% of the total PMS in the country, highlighting that the rich were benefiting more from the subsidies.

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