IPMAN advises FG to remove petrol subsidy

Independent Petroleum Marketers Association of Nigeria (IPMAN) on Thursday advised Federal Government to remove subsidy on petrol in order to increase sector’s contribution to the nation’s revenue.

Mr Mike Osatuyi, National Operations Controller, IPMAN gave advice in an interview with News Agency of Nigeria (NAN) in Lagos.

He was reacting to President Muhammadu Buhari’s presentation of 2022 budget proposal to National Assembly.

Buhari, while presenting N16.39 trillion ‘Budget of Economic Growth and Sustainability’, had noted poor performance of oil in 2021 budget.

president said this was due to shortfall in production , as well as significant cost recovery by Nigerian National Petroleum Corporation to cover shortfall between its cost of importing petrol and the pump price.

Osatuyi said that petrol subsidy eroded significantly eroded revenues that should have been available to fund 2021 budget.

president has identified problem and the solution is to remove the subsidy,” he said.

He, however, noted that before proceeding with the policy, the government should provide alternatives to Nigerians in order not to increase inflation in the country.

Osatuyi said there was an urgent need to switch massively to gas utilisation in Nigeria because the country had over 200TCF of proven reserves of natural gas.

He said the government should focus on the implementation of the autogas scheme and distribution of free cooking gas cylinders because they would help cushion the effects of the full deregulation of the downstream sector.

Osatuyi also called for the reduction in the cost of governance to eliminate borrowing to fund parts of the budget annually.

He said: “If as a government your total is N8 trillion and you are preparing a budget of N13 trillion, it means you will have to borrow to fund the budget.

“You can decide to reduce cost of governance and block leakages so that you don’t need to borrow to fund your budget.” (NAN)

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