“The truth is that subsidy has been removed,” Babatunde Fashola, SAN, former minister of works and housing, said during an interview on Channels Television on Wednesday to get his insight on the fuel subsidy removal issue that has generated so much public debate and concern amongst Nigerians.
“First to think of it, we see subsidy only as price, but the truth is that subsidy is driven by law and pricing,” he added, explaining the complex relationship between the law and pricing as it concerns fuel subsidy.
Since President Bola Ahmed Tinubu announced in his speech during his inauguration and swearing-in on Monday that the “subsidy is gone,” the country has been going through one of its most trying periods.
Following that announcement and words of endorsement from the Nigerian National Petroleum Corporation (NNPC) Limited, queues have returned to the nation’s petrol stations, with petrol prices selling between N480 and N700, BusinessDay has learned.
The former minister said that the past government didn’t make any provision for fuel subsidy in the 2023 budget, and currently subsidy payments are due to expire in June.
“The 2023 budget has no subsidy budget beyond June. So as a matter of policy, this outgoing government has said we cannot fund subsidy anymore—we are taking it to the end of our administration.
“As a matter of law, the Nigerian people passed a law to end subsidy in June because it was made by the National Assembly,” he explained.
“Before then, the Nigerian people passed the Petroleum Industry Act (PIA) to say this thing must end. A date has been set for it by law, and what remains for this administration, in my view, is how to manage the impact and what it will do with the possible savings that come from not paying for it,” he noted.
He agreed that there is a window of possibility for the Nigerian people to get their representatives in the National Assembly to rescind the fuel subsidy removal decision, a decision that, according to him, will come at a high cost.