As part of efforts to stabilize the Nigerian economy, the federal government has unveiled a fresh plan to spend about N5.4 trillion on fuel subsidy.
This is contained in the Accelerated Stabilization and Advancement Plan report presented to President Bola Tinubu by Wale Edun, the minister of finance and coordinating minister of the economy.
The plan aims to fast-track economic recovery, assist as many Nigerians as possible, and further mitigate the impact of the ongoing economic reforms of this administration.
The plan to be implemented within one to six months will tackle inflation and further increase the purchasing power of the populace.
The report said the subsidy payment was part of difficult challenges threatening to unravel bold reforms by the president.
The report said, “Fuel subsidy: At current rates, expenditure on fuel subsidy is projected to reach N5.4 trillion by the end of 2024, This compares unfavourably with N3.6tn in 2023 and N2.0tn in 2022.”
The amount represents an average of N450bn monthly subsidy bill.
The document indicated the government had yet to reduce, “fuel subsidies to zero given the current inflationary and consequent social pressures.”
It also recommended developing a framework for market-driven pricing of petroleum products and a full fuel subsidy sunset to facilitate growth in the oil sector.
Politics Nigeria recalls that President Tinubu had declared an end to the subsidy regime during his inaugural speech on May 29, 023.
Government officials including the minister of State for Petroleum Resources, Heineken Lokpobiri, have severally denied the reinstatement of subsidy despite overwhelming evidences.