Fuel subsidy hurting Nigeria, it must stop- Sanusi

Lamido Sanusi, former Emir of Kano, said that it amounts to “stupidity” for the Federal Government to continue subsidy payments when it is clear that it is pushing the nation into ”bankruptcy.”

He, therefore, called on the incoming government of Asiwaju Bola Tinubu to stop the policy.

Sanusi, who is also a former governor of the Central Bank of Nigeria (CBN), said those in support of subsidy must realise that “cheap fuel” is not more beneficial to the poor than education, healthcare and power.

His words: “In 2011, we tried to explain that it’s bad economics; for every $1 billion Nigeria spends on fuel subsidy, it is $1 billion out of education, $1 billion out of healthcare, $1 billion out of power, $1billion out of infrastructure.

“What you (people in support of subsidy) are saying is that for the poor people in this nation, cheap fuel is more important than education, more important than healthcare, more important than power, etc. If you do that for 30, 40 years, what kind of country are you going to have? Which is what we have had.”

Sanusi described what currently obtains in Nigeria as a hedge and not subsidy.

He added: “As subsidy is, you’ll say if the price is X, we’ll pay 20 percent of it. That’s a subsidy. You will never pay more than X. For a product, whose price I do not control, it doesn’t matter whether the oil price is $200 or $150 a barrel, the Nigerian government has an unlimited pocket, and it will fund the difference.

“The exchange rate can move from N150 to N500 and the Nigerian government will fund it (subsidy). It’s stupidity. You’re heading to bankruptcy. We are walking into bankruptcy with our eyes open.

“We can’t ignore that, and therefore, if I have a new government on May 29 that tells me, ‘Oh, I’m going to continue paying this subsidy for the next three years,’ I’m going to say you’re not serious.

“I’m going to just close my eyes and get ready for the next election in 2027 because we’re going to be here in 2027 talking about the same things.

“People say phase it, but what happens if you start phasing and a year from now you’ve had a massive devaluation? ”

El-Rufai, who is the governor of Kaduna State, said that President Muhammadu Buhari had agreed that fuel subsidy spending made no sense but refused to halt it.

He said: “Between September and November 2021, the National Economic Council gave us an assignment to work out what to do if we withdraw subsidy, how much will be raised, etc. We worked with experts and the World Bank.

The council, according to him, developed a framework on what to do with what would be saved once subsidy is halted, and how to release more money for education, health, infrastructure, etc.

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