The Federal Government have introduced palliatives worth N4.3 trillion to mitigate the effects of the fuel subsidy removal under the current administration, as reported by Sunday PUNCH.
These palliatives include cash payments to over 18.7 million vulnerable households and the acquisition of CNG-powered buses amid rising inflation. Other measures encompass agricultural interventions and financial aid to manufacturers, small, and medium-sized enterprises.
These actions stem from President Bola Tinubu’s commitment to alleviate the economic hardships faced by Nigerians. The World Bank had previously warned that 7.1 million Nigerians were at risk of falling into poverty if the government did not provide adequate compensation or palliatives following the fuel subsidy removal. The removal led to a significant increase in petrol prices, adversely affecting poor and economically insecure households, resulting in an estimated monthly income loss of N5,700 per household.
In response, President Tinubu, in a national broadcast on July 31, announced an initial set of palliatives. These included N100 billion for 3,000 units of 20-seater CNG-fueled buses, N200 billion to boost agricultural production, N75 billion for manufacturers, and N125 billion for micro, small, and medium-sized enterprises and the informal sector.
In August last year, the Federal Government also announced N5 billion as palliative measures for each state and 180 trucks of rice. Governor Babagana Zulum of Borno State stated that this allocation would help states procure 100,000 bags of rice, 40,000 bags of maize, and fertilizers to address food shortages.
Additionally, the government introduced a N35,000 monthly provisional wage award for all treasury-paid Federal Government workers for six months, starting in September last year. The Director-General of the Budget Office, Ben Akabueze, revealed that this would cost the government N315 billion for six months.
Furthermore, the Minister of Information and National Orientation, Mohammed Idris, announced a payment plan of N75,000 to 15 million households at N25,000 per month for three months (October to December 2023), totaling N1.13 trillion.
There was also a controversial N70 billion palliative earmarked for lawmakers to support the working conditions of National Assembly members. Additionally, the Federal Government extended a N75 billion loan facility to 1.5 million market women, bringing the total palliative and loan pledge last year to N3.27 trillion.
Recently, President Tinubu announced another N1 trillion in palliatives during the 142nd National Economic Council meeting. This includes a National Construction and Household Support Programme, providing N50,000 grants for three months to 100,000 families in each state, N155 billion for assorted foods, N540 billion for household grants, and N10 billion allocations for CNG buses to each state and the FCT. This latest initiative is expected to benefit 3.7 million families, bringing the total number of households supported to 18.7 million.
Special Adviser to President Tinubu on Information and Strategy, Bayo Onanuga, emphasized the president’s compassion and determination to alleviate the ongoing economic hardships. Onanuga noted that while previous interventions had an impact, the current measures aim to provide more significant relief amid persistent inflation and economic challenges.
Economists support the distribution of cash palliatives to mitigate the effects of the petrol subsidy removal on the less privileged. Professor of monetary economics, Olusegun Ajibola, stated that palliatives are essential during emergencies when economic survival is under threat. Another economist, Johnson Chukwu, emphasized that the government must care for the less privileged without allowing palliative schemes to enrich the political class.
