Removal of subsidies: NLC warns that rising fuel prices will affect transport costs and food prices

The Nigerian Labor Congress has warned that the planned removal of fuel subsidies and subsequent increase in fuel prices will affect all aspects of life including transport, cost of food, clothing, housing and others.

This was revealed by Mr. Ikechukwu Nwafor, Chairman of the NLC in Ebonyi, in an interview with News Agency of Nigeria (NAN) in Abakaliki on Friday.

It comes after Senate Speaker Ahmed Lawan claimed the removal of the fuel subsidy was not a directive from President Muhammadu Buhari.

What the NLC says

Nwafor said it is high time for Nigeria to fix its own refineries, adding that Nigeria can end the import of fuel into the country if it can keep the refineries running.

“You have to understand that now is not the right time to increase the price at the pump when the cost of living is already difficult. Food prices are already beyond the capacity of officials.

“How are the civil servants, who are the engine of the economy, going to get out of this?

“What we are saying to the federal government is to consider the consequences of the increase on the masses and the current economy,” said Nwafor.

He warned that the increase will affect all facets of life including transportation, high cost of groceries, clothing, housing among others.

He also said that the NLC chapter in Ebonyi State was planning to embark on a protest on January 27, urging all Nigerians and Ebonyi State to rise up against the removal of oil subsidies and rising the price of fuel.

“Of course, the increase will affect all citizens and we say no to it”, he said

What you should know

  • Zainab Ahmed, Minister of Finance, Budget and National Planning, had said that the federal government planned to remove fuel subsidies in 2022 and that part of the revenue that would be saved from the removal of subsidies would be used to serve millions of households through the conditional cash transfer. program.
  • Kaduna State Governor Malam Nasir El-Rufai said Nigeria was losing N250 billion a month on petrol subsidies and state governors pledged to help the federal government put end to the fuel subsidy scheme.
  • The World Bank also said that Nigeria spends $4.5 billion on fuel subsidies, which represents 2% of GDP or 35% of oil and gas revenues. The global financial institution said Nigeria’s PMS grant imposes a massive and unsustainable fiscal burden. The cost of the PMS subsidy in 2020 has increased from just 4% of oil and gas revenues that are first transferred to NNPC ($0.3 billion) to 35% in 2021 ($4.5 billion or approximately 2% of GDP) and that Nigeria’s average daily oil production fell from 2.0 million barrels per day (bpd) in 2019 to 1.8 million bpd in 2020 and less than 1.6 million bpd in during the first nine months of 2021, its lowest level in two decades.
  • Information and Culture Minister Lai Mohammed vowed to consult with relevant departments and ministries to clarify the federal government’s exact position on the controversy surrounding the removal of fuel subsidies in 2022.
  • This week, the vice president’s office denied that the National Economic Council (NEC) led by Yemi Osinbajo had recommended raising the price of Premium Motor Spirit (PMS), otherwise known as gasoline, to N302 per litre, adding that there are ongoing discussions on the fuel subsidy issue.
  • Meanwhile, the Nigerian Governors Forum (NGF) has also announced that it will engage with organized labor groups in Nigeria on the planned removal of fuel subsidies.

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