Youth Party faults FG's decision on subsidy removal suspension

Youth Party has expressed disappointment over the suspension of subsidy removal by the Federal Government.

In a statement entitled ‘Remove subsidy, protect the poor,’ the party believed the decision was counter-productive, and that government should have gone ahead to remove the subsidy to stop the economic haemorrhage, and should have also helped the poor masses through other robust programmes.

In its position paper, it noted that “The Government through the Minister of Finance, Budget and National Planning, Zainab Ahmed earlier announced that the government would stop subsidy payments on petroleum products in June. Unfortunately, the government reneged on its initial position in a meeting reportedly convened by Ahmad Lawan, President of the Senate with Zainab Ahmed, Timipre Sylva, minister of State for Petroleum Resources; Mele Kyari, group managing director, NNPC Limited in attendance.”

It further pointed out that “The statement that the President is unaware of the commitment to remove subsidy is misleading.

“The real issue is not whether the President is aware of its removal or not because the President presented the 2022 budget, and signed the Appropriation Bill into law which signaled the removal of subsidy in June as only N443 billion was appropriated for subsidy payment from January to June 2022.

“Also, the President signed the Petroleum Industry Act (PIA) which expressly gave the government six (6) months to remove subsidy on petrol and allow market forces determine the price. Hence, the decision of the government to suspend the subsidy removal beyond February 16, 2022 (6 months) is illegal and in direct breach of the PIA. The President cannot claim to be ignorant of the law he signed.”

The party further said: “Currently, payment for petrol subsidy costs the government over N250 billion monthly. In a year, the government will spend over three (3) trillion naira on subsidy and this is likely to increase if crude oil price increase globally. It is unfathomable that in a pandemic the payment of subsidy is almost double the entire health and education budget. Only N820bn (5percent) was allocated to health, while education sat at N1.29 trillion (7.9percent) with a country of over 200 million people. We cannot justify spending less than 13percent of our budget on both health and education when subsidy will be taking 17.5percent of the budget. The situation is even worse when we consider the fact that the government is wantonly borrowing money and egging towards a debt crisis because we are funding subsidy.

“Equally disturbing, the government pays an estimated N30 billion every month as electricity subsidy and between 2019 – 2021 over N1 trillion was spent despite the sector being privatised over eight years ago.”