Nigeria’s Finance, Budget and National Planning Minister, Zainab Ahmed, has revealed that the Federal Government would remove fuel subsidies by 2022 and substitute them with N5000 monthly transportation grant to the poorest Nigerians.
While speaking at the launch of the World Bank Nigeria Development Update (NDU), Ahmed said the grant wOuld reach about 30 to 40 million Nigerians who are the poorest in the country.
She made it known that the final number of beneficiaries will depend on the available resources after the removal of the fuel subsidy.
She said: “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.
“We are very optimistic that the recent developments in the oil sector, such as the Petroleum Industry Act (PIA) 2021, hopefully, the full reactivation of the 4 public refineries in the country, and the completion and coming on stream of the 3 private refineries under construction in 2022, would significantly boost contribution from the sector to our economic growth efforts.
“I agree with the Report that with the expansion of social protection policies during the pandemic, the government has an opportunity to phase out subsidies such as the PMS subsidy while utilizing cash transfers to safeguard the welfare of poor and middle-class households.”
According to the Minister, this move will commence in June 2022, but the government hopes to start it before June in line with the Petroleum Industry Act (PIA).
