Nigeria Spends Over N13trn On Subsidy – NEITI
Nigeria expended over N13.69 trillion between 2005 to 2021 to finance subsidy payments, the Executive Secretary, Nigeria Extractive Industry Transparency Initiative (NEITI), Orji Ogbonnaya Orji, has said.
“We have outlined what needs to be done in our policy advisory, entiled: “The cost of fuel subsidy to the nation, options for policy review”, which will further provide the necessary guidance on this issue,” he stated.
Orji called for an urgent disclosure of a comprehensive welfare programme for the vulnerable, saying,
“We recommended the urgency to unveil a comprehensive Welfare Programme for the poor and the vulnerable.
“The need to support citizens in the areas of social safety nets, review of workers’ welfare, micro-credits and mass transportation has become urgent.”
Orji spoke at a programme organised by ActionAid Nigeria, in collaboration with the Centre for Social Justice and the Nigeria Labour Congress (NLC).
He said: “NEITI is fully aware and quite sensitive to the pains we are all passing through following the removal of the Petroleum subsidy, adding however that this fundamental policy shift is a necessary policy decision whose time has come.”
Orji noted that NEITI supports the President’s removal of petroleum subsidy because of its huge burden on the economy, depriving other sectors of the much-needed funds for development and social projects.
He said close to N4 trillion of the 2022 budget was slashed from the budget for health, education, infrastructure, etc to fund subsidy payments.
He said NEITI is aware that action is in progress, but we need to move as fast as the speed of light to ameliorate the interim negative consequences of the removal. He called on the Federal Government to urgently tackle crude oil theft.
The Executive Secretary revealed that the country lost $16.25trillion to oil theft between 2009 and 2020.
He noted that the act resulted in losing 140,000 barrels of crude oil estimated at $10.7million daily.
His words: “Another area we highlighted was the urgent need to tackle crude oil theft. NEITI reports between 2009 -2020 revealed that Nigeria lost over N16.25 trillion to oil theft.
“This amounts to losing over 140,000 barrels of crude valued at $10.7 million daily.”
He also charged the Federal Government to develop and publish a detailed costed and comprehensive gas policy with clear roles for state, non-state actors and investors.
This, he advised, should be linked to the transparent gas flare commercialization programme and Nigeria’s Energy Transition Plan.
According to him, NEITI is really available to support this process with information and data.
NEITI, he said, also requested that deliberate attention should be paid to reforms in Nigeria’s solid minerals sector.
Orji said these include urgent amendment of the Mining Act 2007, creating a state-owned enterprise like the NNPC Ltd but with a strong private sector-led governance structure.
He disclosed that “since 1999 to 2020, the Federal government has earned $741.4 billion as revenues from the oil/gas sector and 8.16% of the real GDP in 2020 while solid minerals earnings from 2007 to 2020 was N635.19 billion representing 0.45% of our GDP.
“NEITI’s appeal to the new administration is to pay a high premium on the reform and development of solid minerals to compete in revenue generation and prepare Nigeria for the global energy transition program that is inevitable.”
He said the journey towards a prosperous Nigeria requires stringent sanctions for criminal activities especially in the extractive sector.
NEITI commended the President for his pledge at his inaugural speech to he bold sustain the ongoing fight against corruption.
Continuing, he said, “This is most welcome. NEITI therefore recommends that the pledge on the fight against corruption should be followed with sustained Presidential pronouncement, an action plan and unveiling a national strategy for this initiative.
“The international community and our development partners are eagerly looking out for these commitments, a plan and strategy supported by the political will to punish bad behaviour, block leakages and curb wastage.
These actions will also boost citizens’ and investors confidence and accelerate economic growth and development.”
