- Minister says govt will cushion impact of subsidy removal
- Says govt is determined to give Nigerians 7,000 megawatts by 2021
By Demilade Aderibigbe
An appeal has gone to organised labour to shelve its proposed strike action over the removal of fuel subsidy and the increase in the electricity tariff, an action which they said could only lead to more hardship for Nigerians.
The Minister of Information and Culture Alhaji Lai Mohammed stated this in Lagos on Saturday while speaking with select online newspaper publishers.
According to Mohammed, contrary to the accusation that the Muhammadu Buhari administration is high handed, unmindful and insensitive to the pains and plights of the Nigerians, the full deregulation of the petroleum sector, especially the PMS, and the increase in electricity tariff would in the long run benefit the ordinary people. He said government is determined to cushion the effect of the tough decisions on Nigerians.
The Minister said the government can no longer afford to subsidize both PMS and electricity consumption which has been privatized and handed over to private organizations a cost which he said runs into trillions of Naira.
Mohammed said it is more painful that ordinary Nigerians are not benefiting from the subsidy regime which has been in place for decades, adding that the government spent about N10.4 trillion on fuel subsidy between 2006 t0 2019, most of which went to people who collected sunsidy for products they didn’t import or which has been diverted to neighbouring countries, where the prices are much higher.
He said: “The truth is that the government can no longer afford the cost of subsidy, especially under the prevailing economic conditions where revenue and foreign exchange earnings by the government have fallen by almost 60 percent due to the downturn in the fortunes of the oil sector.”
Mohammed said an average of N743.8 billion per annum was spent on “needless” subsidy, adding that the drastic fall in government revenue explains why the government had to take tough decision, even as there are plans to cushion the effect of those decisions on the people.
He said even with the current price of PMS in the country, the product is still cheaper in the country than in many neighbouring countries, where same litre exchanges for between N359 to N366, whereas it costs N161 locally.
On electricity, the tariff adjustment is to support the industry on which the government has spent almost N1.7 trillion since the privatization over a decade ago.
He said Nigerians who consume less than 10 hours of electricity a day are excluded from the new tariff, even as he said anyone with complaints over arbitrary or estimate billing can lodge same with their DISCOs for rectification.
The Minister said to put an end to the menace of estimated billings, the government is embarking mass metering programme where provisions has been made to provide meters for over five million Nigerians, which must be driven by local producers in order to create more jobs.
He said the government is determined to connect another five million Nigerians who are not on the national grid with solar power in the next 12 months, a step, he disclosed would again produce about 250,000 jobs and impact on 25 million beneficiaries via a reliable and sustainable solar system.
He sued for the understanding of Nigerians over the hard decisions which he said would help save trillions for the country.
He disclosed that the ongoing work by the German company Siemens would boost power supply in Nigeria and help end the perennial power problem in the country as Nigerians will enjoy 7,000 megawatts of reliable power supply by end of 2021, 11,000 megawatts by the end of 2023, which is phase two and 25,000 megawatts in the third phase.