FG Lists Benefits Of Fuel Price Increase To Nigerians

The Federal Government has revealed that the recent hike of Premium Motor Spirit (PMS)— fuel price will benefit Nigerians, Brandnewsday reports.

The hike in the cost of fuel, as a consequence of deregulation in the past few days, has led to various reactions, including a planned nationwide strike by the labour union.

Some Nigerians also have fingered President Muhammadu Buhari led-administration of being inconsiderate to feel the plight of Nigerians, despite the downtime during this COVID-19 pandemic.

Lai Muhammed: Fuel price

Speaking on the benefits of the increase in petrol price, the Minister of Information, Lai Mohammed while addressing newsmen in Lagos, Saturday stated that, unlike popular opinions, the government is not insensitive to Nigerians, adding that the full deregulation of the petroleum sector and the service-based electricity tariff adjustment will, in the long run, benefit the ordinary people.

Muhammed said: “Let’s start with deregulation. Ordinary citizens are not the beneficiaries of the subsidy on petroleum products that have lasted for years. Between 2006 and 2019, a total of 10.4 trillion Naira was spent on fuel subsidy, most of which went to fat cats who either collected subsidy for products they didn’t import or diverted the products to neighbouring countries, where prices are much higher. Instead of subsidy, ordinary Nigerians were subjected to a scarcity of petroleum products.

”They endured incessant long queues and paid higher to get the products, thus making the subsidy ineffectual.”

According to him, aside from the benefits, the government can no longer afford the cost of subsidy due to the economic conditions.

“Apart from that, the truth is that the government can no longer afford the cost of the subsidy, especially under the prevailing economic conditions. Revenues and foreign exchange earnings by the government have fallen by almost 60%, due to the downturn in the fortunes of the oil sector. And there is no provision for subsidy in the revised 2020 budget.

“So where will the subsidy money come from? Remember that despite the massive fall in revenues, the government still has to sustain expenditures, especially on salaries and capital projects,” Lai Mohammed added.