ABUJA, Nov. 25 (Reuters) – Nigeria’s 2022 budget does not include a transportation subsidy of 2.4 trillion naira ($ 6 billion), the chairman of the Senate finance committee said Thursday.

Finance Minister Zainab Ahmed said this week the government plans to end the country’s long-standing fuel subsidy by the middle of next year and replace it with monthly payments of 5,000 naira. to the poorest families as a transport subsidy. Read more

“We have nowhere in the budget where 40 million Nigerians will receive 5,000 naira per month as transportation allowance,” Senator Solomon Adeola told reporters in Abuja.

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Adeola said the transport payment proposal should be discussed and in particular how it will be funded.

“If such a proposal is to come true … how to identify the 40 million Nigerians who will benefit from this process.”

He said the 2022 budget under review contained a provision for a grant but did not specify what it would be used for.

Successive Nigerian governments have tried unsuccessfully to remove the fuel subsidy, which undermines revenues. Attempts to suppress it have sparked street protests and strikes.

The unions rejected deregulation of the country’s downstream oil sector which relies on imports of refined petroleum products, advising the government to speed up modernization work at the country’s four refineries.

Oil prices in Nigeria could climb to 340 naira ($ 0.83) by February, from 165 naira, with the removal of subsidies, Nigerian union leader Ayuba Wabba said, citing national oil company NNPC. .

On Tuesday, the World Bank urged Nigeria to end its costly oil subsidies within the next three to six months, improve exchange rate management and accelerate other reforms to boost growth. Read more

Ahmed said the fuel subsidy could cost Nigeria up to 3 trillion naira ($ 7 billion) per year in lost revenue.

The government budget includes record spending of 16.39 trillion naira ($ 39.8 billion) for 2022, a projected 25% year-on-year increase in government spending as the economy recovers from the impact of the COVID-19 pandemic. Read more

($ 1 = 409.63 naira)

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Report by Camille Eboh. Written by Chijioke Ohuocha. Editing by Jane Merriman

Our Standards: Thomson Reuters Trust Principles.


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