President Muhammadu Buhari has insisted that there is no going back on its decision to increase tariff hike in the country, as there would be negative consequences if the government continued subsidising the prices fuel and electricity.
Buhari stated this at First year Ministerial Performance Review Retreat, at the State House Conference Centre, Abuja, on Monday, September 7, 2020.
He said regrettably, government could not go back on its decision to deregulate the petroleum sector and allow the forces of demand and supply at the international level to dictate the prices of Premium Motor Spirit.
The president, who was represented by Vice President Yemi Osinbajo, said the COVID-19 pandemic, had led to a severe downturn in the funds available to finance its budget and had severely hampered government’s capacity to deliver.
He added that one of the steps taken at the beginning of the crisis in March when oil prices collapsed at the height of the global lockdown, was the deregulation of the price of premium motor spirit (PMS) such that the benefit of lower prices at that time was passed to consumers.
“This was welcome by all and sundry. The effect of deregulation though is that PMS prices will change with changes in global oil prices.
“This means quite regrettably that as oil prices recover we would see some increases in PMS prices. This is what has happened now. When global prices rose, it meant that the price of petrol locally will also go up,” he said.
According to Buhari, there were several negative consequences if government should even attempt to go back to the business of fixing or subsidizing PMS prices. He also disclosed that the Federal Government has spent about N1.7 trillion to supplement electricity tariff shortfalls in a bid to keep the sector alive.
The President explained that the problems associated with the power sector privatization exercise informed the decision of government to keep supporting the largely privatised electricity industry.
The president said those who got less than 12 hours supply, or the Band D and E Customers must be maintained on lifeline tariffs, meaning that they would experience no increase, stressing that this is the largest group of customers.
He explained that government had also taken notice of the complaints about arbitrary estimated billing.
Naija News recalls that the recent fuel price increase on September 2, 2020, following the removal of subsidy on petrol in Nigeria, has continued to generate outrage among stakeholders.
Femi Falana a well respected human right activist in his reaction in a recent article called the decision a deliberate effort to exploit the season.
Speaking via a recent article the respected lawyer also accused the president Muhammadu Buhari of deceiving the public.
Falana stated that only President Buhari is empowered by law to fix fuel Price.