President Muhammadu Buhari says the federal government has made provisions for fuel subsidy payments in the 2019 budget.
The president said ₦305bn an equivalent of $1bn has been aside for the payment.
Speaking to the joint session of the national assembly on Wednesday in Abuja, the president said the amount will be used to cater for NNPC “under-recoveries”.
Buhari said “We have allowed N305 billion, equivalent to $1 billion for under-recoveries by NNPC on premium motor spirit in 2019.
“We will continue working to bring it downwards, so that such resources are freed to meet the developmental needs of our people.
“Let me also use this opportunity to address and clarify the under-recoveries or subsidies on petrol in a period of economic challenges, our purchasing power is weak, we must reduce some of the burden on Nigerians.”
The president — while justifying the payment of subsidy — said that subsidies today are different from what was obtainable in the past, noting that the NNPC is the sole importer of oil today.
“The problem in subsidies in the past was abuse and corruption. Today, the government through the NNPC is the sole importer of premium motor spirit
“Therefore the under-recovery is fro the NNPC trading account. This means the possibilities of some marketer falsifying claims are removed.” Buhari added
The senate recently confirmed that $1.05 billion NLNG dividend to the Nigerian state was also used for fuel imports in 2018.