Fuel subsidy hurting economy, N900bn projected for 2022 — Minister

The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, has insisted that Nigeria needs to do away with the fuel subsidy payment as it was hurting the economy.

This just as the minister added that the federal government projects to spend the sum of N900 billion on subsidy in 2022

She said this at the presentation of the Draft 2022-2024 Medium Term Expenditure Framework/Fiscal Strategy Paper (MTEF/FSP) public presentation Thursday in Abuja.

Mrs. Ahmed, who noted that with as much as “N150 billion spent in a certain month”, on subsidy payment, it was beginning to be a case of “pennywise pound foolish”.

“We do need to get rid of subsidy as the country” was “subsidising consumption in the whole region.

“The beneficiaries are the marketers” she said.

According to her, when the subsidy is removed, “the economy will be better off for it.”

She explained that the pain from the removal of the subsidy will only last for a short time as “we need to bear the transition.”

In her presentation, Mrs. Ahmed said that the federal government is projecting that the 2022 budget would rise by N393 billion to N13.98trn trillion.

President Muhammadu Bahari assented to the 2021 budget of N11.5 trillion.

The minister disclosed that the federal government is expected to spend the sum of N13.98 trillion in the 2022 fiscal year.

According to the breakdown of the Expenditure, debt servicing is expected to gulp N3.6 trillion in 2022 as against N3.12 trillion in 2021, while non-debt recurrent expenditure is projected at N6.2 trillion in 2022 as against N5.64trn in 2021.