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Why Labour Must Accept Petrol Subsidy Removal

By Adewole Kehinde

The 72nd edition of the Nigerian National Petroleum Company (NNPC) Ltd Monthly Financial and Operations Report (MFOR), was released on Wednesday, 22nd December 2021 and indicated that fuel subsidy raises hits N1.16tn in 11 months (January to November 2021).

Also the report indicated that Nigerian National Petroleum Company Ltd’s remittances to the Federation Accounts Allocation Committee fell by N1.78tn in 11-month period. The funding performance report captured the projected monthly remittance as N122.767bn, but this target was never met for all of the 11 months.

I wondered why the Nigeria Labour Congress would want the Federal Government to be spending a whopping N1.16tn on subsidies yearly when the amount would have gone a long way to alleviate poverty, create jobs and improve infrastructure across the country and enable small scale industries to spring up across the country.

Labour already knows that the Petroleum Industry Act 2021 has put an end to fuel subsidy and it will be illegal for the Nigerian National Petroleum Company (NNPC) Ltd to subsidize Petroleum Motor Spirits with almost N173.132bn per month.

For clarity purposes, below is the breakdown of monthly subsidy payment as obtained from the NNPC Ltd: the oil company spent N25.374bn in February, N60.396bn in March, N61.966bn in April, N126.298bn in May, N164.337bn in June, N103.286bn in July, N173.132bn in August, N149.283bn in September, N163.709bn in October and N131.4bn in November respectively!

From the above, it could be seen that the Nigerian National Petroleum Company (NNPC) Ltd is spending so much on petrol subsidy.

Imagine N1.16tn going into genuine poverty alleviation and infrastructure development every year, Nigerians won’t have the cause to complain of hardship in buying PMS at N340 per liters.

I must commend the Nigerian Governors’ Forum for agreeing to back the Federal Government in halting the petrol subsidy regime, even though it is now a constitutional matter.

The State Governors must ensure that the extra money coming from the subsidy removal go into genuine use to create jobs and fix our educational and health system.

On a final note, the Federal Government must be tactical in handling the effect of subsidy removal and give hope to Nigerians.

 

Adewole Kehinde is a Public Affairs Analyst based in Abuja and can be reached via 08166240846, 08123608662. E-mail: kennyadewole@gmail.com

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