Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, said yesterday that the Federal Government was borrowing money to fund petrol subsidies, insisting that the subsidy regime had become totally unsustainable. Ahmed, who disclosed this at the public presentation of details of the 2023 budget in Abuja, stated: “Fuel subsidy cost was a very high one; We have been funding it from borrowing.”
According to her, petrol subsidy will “remain up to mid-2023 based on the 18-month extension announced early 2022. In this regard, only N3.36 trillion has been provided for the PMS subsidy.” President Muhammadu Buhari’s administration had announced plans to end subsidy from July 2022 but changed its position when faced with threats of nationwide protests by labour.
Party members and some officials of the administration were said to have convinced President Buhari that the decision will negatively affect his public rating and that of the ruling party and this forced the government to later announce an extension of the subsidy regime to lapse in June this year, one month after leaving office.
The minister also said the reconciliation between the ministry and the Nigerian National Petroleum Company Limited, NNPCL, is still ongoing to determine crude oil revenues and what should accrue to the federation account.