The House of Representatives’ Ad Hoc Committee to Investigate the Petroleum Products Subsidy Regime from 2013 to 2022; grilled the Minister of Finance, Budget and National Planning, Zainab Ahmed, over payments of subsidy; on Premium Motor Spirit (petrol) by the Federal Government.
In her presentation, Ahmed disclosed that the Federal Government had now proposed a new date to end payments; on under-recovery between the landing cost and regulated pump price of PMS, stating that the subsidy regime was not sustainable; and might force the government to borrow more in 2023.
According to the finance minister, the government had now planned for payment of subsidy for only half of next year; as contained in the 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy Paper.
Ahmed disclosed that the President, Major General Muhammadu Buhari (retd.), transmitted the MTEF/FSP to the President of the Senate, Ahmad Lawan, and Speaker of the House of Representatives, Femi Gbajabiamila; as approved by the National Economic Council and the Federal Executive Council, respectively.
She stated, “One thing that stands out in the Medium Term Expenditure Framework was that if the nation holds on to fuel subsidy as it is designed now, we will be incurring from January to December, a subsidy cost of N6.4tn.
We suggested to the Federal Executive Council, and the council approved that, maybe, we could look at the option of exiting the subsidy (regime) half year.