The federal government has projected to spend N6.7 trillion on petrol subsidy payments in 2023.
Minister of finance, budget and national planning, Zainab Ahmed, said this on Thursday at the presentation of the 2023-2035 Medium Term Expenditure Framework & Fiscal Strategy Paper (MTEF&FSP) in Abuja.
She said subsidy payment projection is based on two prevailing scenarios — business-as-usual or reform.
“Scenario 1 – the Business-as-Usual scenario: This assumes that the subsidy on PMS, estimated at N6.72 trillion for the full year 2023, will remain and be fully provided for.
“Scenario 2 – the Reform scenario: This assumes that petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2021, in which case only N3.36 trillion will be provided for,” the minister said.
Ahmed, however, said both scenarios have implications for net accretion to the federation account and projected deficit levels.
In January, the federal government had put on hold the planned petrol subsidy removal for 18 months, citing “high inflation and economic hardship”.
