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Kunle Adesiyan


Fuel subsidy in Nigeria has long been a contentious issue that has sparked heated debates and raised questions about its economic implications. The government’s practice of providing financial support to reduce the cost of fuel for its citizens has been aimed at making fuel more affordable and alleviating the burden of high fuel prices. However, the sincerity of purpose, betrayal of trust over time, and recklessness of our leaders have cast a shadow of doubt on the effectiveness and sustainability of this subsidy.

Efforts to remove fuel subsidies have been made in recent years in order to promote a more sustainable energy sector in Nigeria. However, these efforts have faced significant stumbling blocks, with the last administration only making payments until the end of June. The announcement of the removal of the subsidy led to panic buying, as people rushed to stock up on fuel at the government-fixed price, believing it would be the last opportunity to do so. Yet, the scrapping of the subsidy did not come into effect immediately but was instead aligned with the outgoing administration’s budget.

The cost of fuel subsidies has been staggering. In the first six months of this year alone, the Nigerian government has spent $7 billion to subsidize fuel, despite the country’s dwindling economy. This amounts to 15% of the budget, surpassing the combined allocations for education (8.2%) and health (5.3%). Such a significant portion of the budget being allocated to fuel subsidies raises concerns about the allocation of resources and the sustainability of this practice. With the removal of fuel subsidy, the humongous amounts spent by the FG can now be deployed to other sectors such as education, health and human capital development while Nigerians are the ultimate beneficiaries of subsidy removal.

It is crucial for the new administration to take a decisive action. All ministries, parastatals, and government agencies should be held accountable and work diligently to ensure their efficiency. The National Orientation Agency, in particular, should have already started public sensitization campaigns when major contenders in the last general elections agreed that subsidy would be removed. Public awareness and education are vital to help citizens understand the reasons behind the subsidy removal and to mitigate the negative impacts it may have on their daily lives.

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The removal of fuel subsidies has immediate consequences, especially in the transportation sector. Mass transit and public transportation should be encouraged now as transport fares have already shot up, leaving commuters stranded at bus stops and contributing to the overall cost of living for Nigerians. The powerful labour union is now preparing for a confrontation with the new government, further highlighting the challenges and complexities of this decision.

The issue of fuel subsidy should not solely rest on the federal government; state governments should also be held accountable. Gombe State, for example, has taken proactive steps to address the challenges faced by the public in terms of transportation. Governor Inuwa Yahaya has provided 80 new buses to the Gombe State Transport Service over the last three years, aiming to facilitate the movement of people, goods and services to and from the state. This kind of intervention and investment in public transportation is commendable and serves as an example for other states to follow.

Oyo State government during its first term in office  acquired 106 buses. It is now imperative for these buses to be put to use now efficiently and effectively, ensuring that the benefits of such interventions reach the citizens who rely on public transportation.

The removal of fuel subsidies is undoubtedly a challenging decision that carries short-term consequences. However, it is a step towards building a more sustainable energy sector and reducing the strain on government finances. It is crucial for the government to communicate its plans effectively, engage with stakeholders, and develop strategies to mitigate the immediate impacts on the lives of Nigerians. Additionally, state governments should take responsibility and explore innovative solutions to support their citizens in the face of these changes.

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While the removal of fuel subsidies may come with sacrifices, it is an opportunity for Nigeria to embrace alternative energy sources, invest in infrastructure, and promote economic diversification. The long-term benefits can outweigh the short-term challenges if the government exhibit courage in ensuring that removal of subsidy has come to stay.