The Nigerian government has secured $800 million, equivalent to N368,288,000,000 from the World Bank under the National Social Investment Programme as part of palliative measures to mitigate the negative effects of the planned removal of the petroleum subsidy by June 2023.
Hajiya Zainab Ahmed, Minister of Finance, Budget, and National Planning, made the announcement Wednesday while fielding questions from State House reporters following the Federal Executive Council (FEC) meeting at the Presidential Villa in Abuja.
She stated that the secured fund was ready for distribution.
When asked about the palliatives that would be put in place before the removal of the subsidy on premium motor spirit, also known as petrol, the minister said: “The second question on exit of fuel subsidy, this is a commitment in the Petroleum Industry Bill. There is 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.
“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’re 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. Today, that register has a list of 10 million households. 10 million households are equivalent to about 50 million Nigerians.
“But we also have to raise more resources to enable us do more than just the cash transfers and also in our engagements with the various stakeholders, the various kinds of tasks that we have to go beyond the requirement of just giving cash transfers. Labour, for example, might be looking for mass transit for its members.
“So, there are several things that we’re still planning and working on, some we can start executing quickly, some are more medium-term implementation.”
When asked how much funding she received from the World Bank for the planned exit, she stated, “$800 million for the scale-up of the National Social Investment Programme at the World Bank and it’s secured, it’s ready for this disbursement.”
When asked if the current administration had discussed subsidy removal with the incoming administration, she said, “There are a lot of discussions going on at different levels, including with members of the transition committee of the incoming government.”
Dr Chris Ngige, Minister of Labour and Employment, stated last week that the incoming administration of Bola Tinubu would be left to handle all issues concerning palliative measures to be implemented to alleviate the impending discomfort caused by the discontinuation of petrol subsidies if they were finally implemented in June 2023.
Ngige, while reacting to a question on the issue, said, “The subsidy palliatives will be left to the incoming government to implement. We’ll simply hand over to them.
“Of course, we will give recommendations which they are at liberty to either accept or reject.”
Clement Agba, Minister of State for Budget and National Planning, stated on March 15 that no decision had been reached on how to mitigate the likely effects of the proposed fuel subsidy removal on the citizenry as the government prepared to phase out petroleum product subsidies in the middle of 2023.
In response to a question, he stated that despite the fact that a committee led by Vice President Yemi Osinbajo had been working for about a year, nothing definitive had been agreed upon.
Agba expressed hope that the committee working with state governors would reach a consensus on the issue soon but added that there is no timetable for Osinbajo's committee to conclude the discussion, which he said is ongoing.
When asked to speak on palliative measures that would be put in place to mitigate the impacts of the subsidy removal, he said: “For over a year plus now, the Vice President, Yemi Osinbajo has been leading a committee working on this and the National Economic Council also has a committee that has also been working on this.
“So, the stage that we are in now is how to finalize the suggestions that have come out from both the federal government and the governors’ side.
“Like you know, it is something that is going to affect the entire nation.
“They will just have to ensure that everyone is carried along, that is both the federal and sub-national governments.”