Subsidy Removal: Government set to disburse $800m palliatives to 50m Nigerians -Minister

*Mrs. Zainab Ahmed, Minister for Finance, Budget and National Planning, reveals the $800 million received from the World Bank is to be paid to 10 million households considered to be most vulnerable to cushion the effect of subsidy removal in the West African country

Isola Moses | ConsumerConnect

As the current administration moves to stop fuel subsidy payments, the Federal Government has secured a sum of $800 million from the World Bank as part of its post-subsidy palliative plans for Nigerian consumers.

ConsumerConnect reports Mrs. Zainab Ahmed, Honourable Minister for Finance, Budget and National Planning, disclosed this development to State House correspondents after the Federal Executive Council (FEC) meeting Wednesday, April 5, 2023, in the Presidential Villa, Abuja, FCT.

Mrs. Zainab Ahmed, Honourable Minister for Finance, Budget and National Planning

President Muhammadu Buhari presided over the FEC meeting Wednesday.

Sequel to a N3.35 trillion petrol subsidy budget in 2022, the Nigerian Government had said it would stop under-recovery payments June this year.

According to the government, subsidy or under-recovery cost the authorities the sum of N3.3 trillion in the first 11 month of 2022.

On the current administration’s resolve on the controversial fuel subsidy removal, the Mrs. Ahmed noted that the government is still working on ending the current subsidy regime June.

The Minister also disclosed that engagements with the newly-established Presidential Transition Council (PTC) and the incoming administration had been initiated.

What’s in $800m palliatives for vulnerable Nigerians?

The Federal Government further said the $800 million received from the World Bank would be disbursed to the 10 million households considered to be most vulnerable to cushion the effect of the subsidy removal.

She explained: “This is a commitment in the Petroleum Industry Act.

“There’s a provision that says that 18 months after the effectiveness of the PIA that all petroleum products must be deregulated, that 18 months takes us to June 2023.”

Ahmed stated: “Also, when we were working on the 2023 Medium-Term Expenditure Framework and the Appropriation Act, we made that provision to enable us exit fuel subsidy by June 2023.

“We are on course, we’re having different stakeholder engagements, we’ve secured some funding from the World Bank, that is the first tranche of palliatives that will enable us give cash transfers to the most vulnerable in our society that have now been registered in a national social register.”

The Minister as well noted “that register has a list of 10 million households. 10 million households is equivalent to about 50 million Nigerians.

“But we also have to raise more resources to enable us to do more than just the cash transfers and also in our engagements with the various stakeholders, the various kinds of tasks that we have go beyond the requirement of just giving cash transfers.

“Labour, for example, might be looking for mass transit for its members.”

On further details of implementation plan

The Minister said: “So, there are several things that we are still planning and working on, some we can start executing quickly, some are more medium-term implementation.”

As regards the plans for the funds, Ahmed further said that the money is currently available for disbursement and concerned stakeholders are being engaged.

She stated: “$800 million for the scale up of the National Social Investment Programme (NSIP) from the World Bank is already secured and ready for disbursement.

“We are currently engaging with all the stakeholders.

“We know that various plans are being considered, including the need for buses by the Labour, amongst several other palliative measures.”