The federal government has admitted that it spent over N13 trillion on fuel subsidy payout in 16 years (2005-2021), which surpasses the entire budget for health, education, agriculture, and defense in the last five years.
Boss Mustapha, Secretary to the Government of the Federation (SGF), said this in Abuja while speaking during the launch of the Nigeria Extractive Industries Transparency Initiative (NEITI), strategic plan 2022-2026.
Mustapha said that the figure could have been higher if other economic and opportunity costs to the nation were computed and built into the expenditures.
“These include the slashing of allocations for the health, education, and technology infrastructure sectors; deterioration of the downstream sector with the declining performance of Nigeria’s refineries, a discentivised private sector investment in the down and midstream petroleum sector; low employment generation since the refining process is done outside the shores of Nigeria and inefficient supply arrangements which often lead to scarcity and its attendant queues among other challenges”, he said.
The SGF added that the federal government was also following the debates around subsidy removal by the citizens, some of which include the need to fix the ailing refineries and the creation of visible safety net programmes to reduce the impact on the poor and vulnerable in the society , especially workers.
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“While we remain open to the ongoing debate, a comprehensive position to guide the incoming administration on when and how to make this decision is being developed by the Presidential Transition Council which I currently head is already fine-tuning modalities on how best to manage the subsidy removal discomfort, which will determine the best ways to approach the thorny issue,” he said.
He lauded NEITI, as the agency revealed in the strategy document, that it will expand its scope of operations to sub-national levels and become more effective in addressing EITI emerging issues – contract and ownership transparency, gender and environmental reporting, energy transition, while strengthening its intervention in policy engagements in the oil, gas and mining sectors.
Ogbonnaya Orji, Executive Secretary of NEITI, in his address said that the three major strategic objectives of the five-year plan were to enhance extractive sector governance reforms through policy research, strategic stakeholder engagement, communication and inter-agency collaboration.
Speaking on the solid mineral sector which he said is being underutilized, Orji said if it is thrown open for investment, it has the potential to contribute over 60 percent to the nation’s GDP thereby outperforming oil.
From the NEITI reports, a total of N624.1 billion was recorded as revenue that has accrued to the government from the sector over a 13 year period which in today’s exchange rate amounts to about $1.4 billion compared to the enormous $394 billion earned in the oil and gas sector in just 10 years. This shows negligence to the enormous potentials in the solid minerals sector.
He said that NEITI will be moving fully into the solid mineral sector to boost its recognition and attention just like the oil and gas sector to drive reforms and ensure that revenues from the sector are prudently deployed for the growth and development of the country.
