In the last seven years, President Muhammadu Buhari has spent N6.88 trillion to subsidise Premium Motor Spirit (PMS) otherwise known as petrol.
Introduced in 1973, fuel subsidy has been a bane of corruption and counter-production for several years which has necessitated the call for its removal by numerous economic experts and international institutions.
Fuel subsidies often take a significant portion of the annual budget. In the 2023 budget proposal, Investors King reported that the Federal Government intends to spend a sum of N3.3 trillion on fuel subsidies between January and June 2023 while N6.72 trillion has been projected for fuel subsidy for a full calendar in 2023.
During an appearance at the House of Representatives, the Ministry for Finance, Budget and National Planning, Zainab Ahmed disclosed that the government’s projection for subsidy in 2023 was N6.72 trillion
It could be observed that several other countries such as India which also implemented the fuel subsidy scheme as Nigeria have removed it years back. However, fuel subsidy in Nigeria on the other hand has been on the rise since when it was implemented.
For instance, in 2015 when the present administration came on board, a sum of N316.7 billion was spent on fuel subsidy. Although there were significant decreases in 2016 and 2017, the figure, however, rose to N722.3 billion in 2018.
Similarly, according to the figure obtained from NNPC, a sum of N1.43 trillion was spent on fuel subsidies in 2021.
Additionally, from the beginning of 2022 to August, data showed that a sum of N2.565 trillion has been spent to subsidise fuel consumption in Nigeria. This is about 15 percent of the 2022 budget.
Experts both within and outside the shores of the country have nonetheless continued to warn the Federal Government that the subsidy regime is unsustainable. They claimed it will only lead to more economic challenges, revenue shortage, and debt.
