Subsidy: Experts decry lack of accurate data on Nigeria’s PMS consumption
Experts on Monday decried the lack of accurate data on Nigeria’s daily Premium Motor Spirit (PMS), also known as petrol, consumption.
This, they said, was worrisome as the pricing template was last published in November 2020 by the now defunct Petroleum Products Pricing Regulatory Agency (PPPRA).
Dr Biodun Adedipe and a former Group Executive Director, Upstream, Nigerian National Petroleum Corporation (NNPC), Mr Bello Rabiu, said this at a subsidy workshop organised for journalists by the Major Oil Marketers Association of Nigeria (MOMAN) in Lagos.
According to them, with the recent approval of three trillion naira by the Federal Executive Council to cover subsidy on PMS, also known as petrol, for another 18 months has economic implications for the country based on current realities.
Adedipe, who is the Chief Executive Officer, Biodun Adedipe Associates, said the cost of petrol subsidy outweighs its benefits.
He added that it was the reason for Nigeria’s underdevelopment.
Adedipe said the trillions of naira expended on subsidising PMS by successive administrations would have been channelled to other critical infrastructure such as roads, power, healthcare and education.
He said research had proven that subsidy was fraught with inefficiencies, fraud and corruption, unsafe business practices and mismanagement of tax payers resources.
He noted that with the current opaqueness surrounding the importation of PMS by the NNPC, it would be in the best interest of the country for the government to fully liberalised the market.
On his part, Rabiu said the 67 million litres per day given by the NNPC as Nigeria’s daily consumption could not be confirmed due to the absence of a pricing template.
He also faulted the NNPC being the sole importer of PMS, adding that marketers should be given a level playing field to import products in order to make the market competitive.
Rabiu said with the rising cost of crude oil in the international market, government would not be able to sustain the payment of subsidy unless it resorts to further borrowing with its attendant effects on the nation’s economy.
He, however, advised the government not to tamper with the Petroleum Industry Act (PIA) 2021 because of the suspension of the subsidy removal.
Rabiu said the issue should be infused into the Finance Act 2021 and amended which would be a less tedious option compared to amending the PIA.
