President Muhammadu Buhari has affirmed that the costly petrol subsidy will end by 2023.
The President stated this during the presentation of the proposed 2023 budget to the National Assembly, in Abuja on Friday.
Buhari presented a record N20.51 trillion 2023 appropriation bill to the National Assembly.
The President stated that the subsidy was no longer sustainable considering the current fiscal impact.
He said, “As we seek to grow our government revenues, we must also focus on the efficiency of utilisation of our limited resources. Critical steps we are taking include immediate implementation of additional measures towards reducing the cost of governance and the discontinuation of fuel subsidy in 2023 as announced earlier.”
Buhari said discontinuing the policy was necessary for the country to manage its limited resources.
Nevertheless, he noted that there would be alternative provisions to curb the effects of the petrol subsidy removal.
The President said, “We are however mindful of the fact that reducing government spending too drastically can be socially destabilising, and so will continue to implement programmes to support the more vulnerable segments of society.
“Petrol subsidy has been a recurring and controversial public policy issue in our country since the early eighties. However, its current fiscal impact has clearly shown that the policy is unsustainable.
“As a country, we must now confront this issue taking cognisance of the need to provide safety nets to cushion the attendant effects on some segments of society.”
Minister of Finance, Budget, and National Planning, Zainab Ahmed had said the federal government will halt spending on petrol subsidy in June 2023.
Some time ago, the Nigerian National Petroleum Company (NNPC) Limited spent N2.565 trillion on petrol subsidy payments since the beginning of the year.
This year, the federal government has projected to spend N4 trillion on petrol subsidies, and another estimated N6.7 trillion in 2023 (if subsidy is not removed).