- Nigeria’s spending on petrol subsidies is taking a massive toll on other critical aspects of the economy
- A recent report shows that the federal government has been spending vast amounts on subsidies than on health, education and defence
- The total budget for subsidy for two years stands at N3.92 trillion, far less than for education, health and defence
The Nigerian government has spent about N3.92 trillion on subsidising Premium Motor Spirit, also known as petrol, from January 2020 to June 2022.
The amount is far higher than spent on defence, health and education, the three critical sectors of Nigeria’s economy.
Petrol subsidy topples important sectors
According to the Punch, in the last 30 months, the country has paid more attention to paying subsidies than the three critical sectors.
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A study of petrol subsidy expenditure and budgets for ministries from January 2020 to the first half of this year shows that the Nigerian government spent over N3 trillion to support petrol imports during the 30 months.
The government’s proposed expenditure for education, health and defence stood at N2.28 trillion, N1.68 trillion and N3.06 trillion, respectively.
The government’s expenditure on those sectors is indicative that it spent more importing and subsidising petrol for the period under review than on health, defence and education.
In 2020, total education, health and defence budgets were N1.922 trillion, while petrol subsidies consumed N450 billion.
In 2021, petrol subsidy spending skyrocketed to N1.43 trillion while the total budget for health, education and defence stood at N2.288 trillion.
Analysts angry over governments attention to subsidy payments
In the first half of 2022, the government spent about N2.04 trillion on petrol subsidies in contrast to the combined budget of N2.81 trillion for health, education and defence.
Analysts criticised the colossal expenditure by the government on petrol subsidies and its impact on education, health and defence.
They stated that the total subsidy budget in the last two years meant a lost chance to invest in critical areas of the economy to boost the literacy level and improve the standard of Living and security in the country.
NNPC reveals how much petrol will cost when subsidy is removed next year
Recall that Legit.ng reported that according to the NNPC, the average daily importation of fuel between January and August 2022 was 68 million litres which it pays N297 per litre to subsidise.
A statement by the company said the total volume of petrol imported into Nigeria was 16.46 billion litres since January 2022 and translated to a supply of 68 million, a BusinessDay report said.
The company stated that it imported about 22.35 billion litres in 2021, reaching 61 million litres per day.