We Have Implement Subsidy Removal In The Electricity Sector, We Will Do The Same For Fuel – Zainab AhmedWe Have Implement Subsidy Removal In The Electricity Sector, We Will Do The Same For Fuel – Zainab Ahmed 4

The Federal Government has said that it has succeeded in quietly removing subsidies on electricity tariffs. Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed this at the Virtual meeting of African Finance Ministers and the International Monetary Fund. The theme of the meeting was ‘The political economy of fiscal reforms’.

She said the amendment of the budget was ongoing to accommodate the incremental removal of petrol subsidy, adding that the government had to carefully adjust the prices incrementally at some levels. She further revealed that petrol subsidy has remained a huge problem for the government, and the rise in global oil prices would worsen the issue.
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“We are cleaning up our subsidies. We had a setback; we were to remove the fuel subsidy by July this year but there was a lot of pushback from the polity. We have elections coming and because of the hardship that companies and citizens went through during the COVID-19 pandemic, we just felt that the time was not right, so we pulled back on that,” Zainab Ahmed said.

“But we have been able to quietly implement subsidy removal in the electricity sector and as we speak, we don’t have subsidies in the electricity sector. We did that incrementally over time by carefully adjusting the prices at some levels while holding the lower levels down.”

“The current review that we are doing is to hold the subsidy at the level in which it is planned… We are currently doing a budget amendment to accommodate incremental subsidy (removal) as a result of the reversal of the decision and we want to cap it at that.

“Hopefully, the parliament will agree with us and we are able to continue with our plan for subsidy (removal) otherwise the way things are going we will not be able to predict where the deficit will be as a result of the fluctuation in the global market.”

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