Updated: After securing $800m World Bank grant, FG suspends removal of fuel subsidy scheduled for June

The Federal Government says it is discontinuing with the plans to remove petrol subsidy by June 2023 as earlier scheduled just as it secured $800m World Bank grant for palliatives.

The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed made this known to State House correspondents after the National Economic Council meeting on Thursday.

Persecondnews reports that the valedictory National Economic Council (NEC) meeting was presided over by Vice-President Yemi Osibanjo (SAN) at the Council Chambers of the Presidential Villa.

Ahmed said after deliberations the Council agreed that the timing of the subsidy removal is wrong.

She also stressed that the consultations with necessary stakeholders and also with the incoming administration would continue “with all of the preparatory works that need to be done”.

“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 works has to be done in consultation with the states and other key stakeholders including representatives of the incoming administration.

“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.

“We have a plan that we will start working on, putting the building blocks towards the eventual removal of the first subsidy.

“And if I may remind this forum that the budget for 2023 has a provision for fuel subsidy only up to June 2023 and also the Petroleum Industry Act has a provision that requires that all petroleum products must be deregulated 18 months after the effective date of the PMS removal and that that period is also up to June 2020,” Persecondnews quotes Zainab as saying.

The Buhari government had secured N300 billion ($800m) from World Bank to provide palliatives for Nigerians to cushion the negative effects of the planned removal of subsidy by June 2023.

The grant which was secured through the National Social Investment Programme is meant for the most vulnerable Nigerians totaling about 10 million households and equivalent to about 50 million Nigerians.