The Federal Government will earmark N6.72trillion for fuel subsidy in 2023 ,Mrs Zainab Ahmed, the Minister of Finance Budget and National Planning,has said.
The Minister ,who disclosed this in Abuja on Thursday during the 2023 – 2025 Medium Term Expenditure Framework and Fiscal Strategic Paper (MTEF and FSP) Public Consultation,stated the government has projected fiscal outcomes in the medium term under two scenarios based on the underlying budget parameters/assumptions.
She said under the first scenario, the subsidy on Premium Motors Spirit is estimated at N6.72 trillion for the full year 2023”,adding that this “will remain and be fully provided for by the NNPC on behalf of the federation”.
The second scenario the minister explained is that “petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2021, in which case only N3.36 trillion will be provided for”.
She cautioned that both scenarios have implications for net accretion to the Federation Account and projected deficit levels.
She noted: “There will be tighter enforcement of the performance management framework for Government Owned Enterprises (GOEs) that will significantly increase operating surplus/dividend remittances in 2023”.
She also announced that the Nigerian National Petroleum Company Limited which had funded the fuel subsidy until last month, would henceforth leave that responsibility to the federation.
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She added that this would even create a greater strain on the fiscal position of the federal government, describing fuel subsidy as unsustainable.
