Considering the considerable fall in the prices of crude, the Nigerian Senate on Wednesday slashed projected subsidies in the 2015 budget of the Federal Government.
In approving the Medium Term Expenditure Framework 2015 to 2017 (MTEF) the upper legislative chamber cut the subsidy budget from N200 billion to N100 billion.
It also reduced the subsidy allocated to kerosene from N91.08 billion to N45.52 billion.
This is the first time that the Budget Office of the Federation has captured allocation for kerosene subsidy in the budget.
Chairman of the Joint Committee on Finance and National Planning; Economic Affairs and Poverty Alleviation, Sen. Ahmed Makarfi, said the reduction was due to the fall in oil prices at the international market.
“The joint committee recommends a downward review of subsidy payment for PMS from N200 billion to N100 billion and kerosene from N91.08 billion to N45.52 billion.
“This is as a result of the current low prices in crude oil prices at the international oil market.
“The relevant committees of the National Assembly should through oversight, ensure the full implementation of the proposed kerosene subsidy and the availability and of the product’’, he said.
Makarfi also said the reduction in the subsidy allocations to petrol reflected government’s commitment to transparency and accountability in the entire oil and gas sector.
In his remarks, the Senate President, David Mark said there was need for a budget cut across the three arms of government in view of the current economic reality.
Mark said the government must continue with it reform policy in order to promote the growth of the non-oil sector.
He expressed delight on the expeditious passage of the MTEF, adding that “this is the kind of cooperation required to build our nation.’’
Also, the Deputy President of Senate, Ike Ekweremadu, said the country must learn from wasteful spending of the past, adding “we must engage in prudent spending in order to build our foreign reserve.’’
He said that many countries had survived with fewer resources, adding that “Nigeria must look away from relying on oil and spending on oil wistfully.’’
“The provision may not be unconnected with ripples generated by the investigation into alleged non-remittances of some funds in the sector.