- ‘N10tr spent in 14 years of subsidy’
The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kolo Kyari, has said the Federal Government removed subsidy on Premium Motor Spirit (PMS), or petrol, because the subsidy regime was characterised by fraud among those he called cabals.
He said the system operated then was not beneficial to the masses, who were the original target beneficiaries.
Kyari said over N10 trillion was spent on fuel subsidy between 2006 and 2020 without significant impact on the masses.
The NNPC chief said marketers snuggled the subsidised PMS to neighbouring countries to make more profit and others faked documents to collect subsidy for fuel they never imported.
Kyari, who spoke in a Hausa Radio programme monitored by our correspondent in Kaduna(The Nation) at the weekend, said the fuel subsidy was the root of all the atrocities and fraud in the oil sector.
The GMD said the Federal Government removed the subsidy with a plan to reinvest the proceeds on projects that will have direct impact on the masses.
“The crude oil is a global commodity and its price is not hidden. Everyone can calculate and know how much is the cost of every final product from the crude at international market. But, since the inception of the country, the government has been paying subsidy on petrol to make it cheaper for Nigerians to buy below the cost price.
“This subsidy is designed to assist the masses of Nigeria; that is the intention. But in reality, the masses are not the beneficiaries. First, the masses are not the owners of the exotic cars buying fuel, owning the filling stations and doing the oil business.
“This subsidy that the government has been paying over the years is the root of all the atrocities and fraud committed in this country. For example, if you look at it from 2006 till 2020, we have spent over N10 trillion on fuel subsidy. Apart from that, there is also subsidy on foreign currencies. Everybody knows how much a dollar is to the naira in the market. But the government is also subsidising it. So, this and the fuel subsidy within this period is around N14 trillion to N15 trillion.
“What was happening with subsidy was that some marketers were smuggling fuel to other neighboring African countries because it was cheaper in Nigeria due to the subsidy. Another one is that some people used to present fake documents to the government to collect subsidy for fuel they never imported and the previous governments were paying them.”
