It has always been a difficult pill for successive regimes to swallow and was therefore not surprising when the National Executive Council, a body that advises the government on economic affairs, on Thursday deferred the much-advertised removal of fuel subsidy, scheduled for implementation in June, to the incoming government of Senator Bola Ahmed Tinubu.

The meeting presided over by the vice president, Prof Yemi Osibajo, with the 36 state governors and some ministers as members, said the timing was not right for its implementation because of the ongoing transition from one regime to another, and therefore suspended its plan to remove the fuel subsidy indefinitely.

Nigeria’s minister of finance, budget, and national planning, Zainab Ahmed, made the announcement after the NEC meeting, saying the government has resolved not to remove the subsidy in June until the transition, leaving the decision for the incoming government.

Despite the fact that the 2023 appropriation act does not include a provision for the continuance of the subsidy beyond June, 2023, she stated that the future administration has the option of revisiting the budget or eliminating the subsidy.

She further clarified that if there are plans to stop subsidizing petroleum products in the country, the outgoing administration has already arranged for the formation of a committee that will include members of the new administration.

Mrs Ahmed noted that, while the NEC disagreed with the timing of the elimination, she stressed that the country could no longer sustain the subsidy and that the government must find a solution to end it once and for all.

“What I said is that it is not going to be removed now, which means it will not be removed before the transition is completed. But then we have two laws that have inadvertently made the provision that we should exit by June. So, if the committee’s work, which will include the representatives of the incoming administration, determined that the removal can be done by June, then the work plan will be designed to exit as at June,” she said.

“But if the determination is that the period is extended it will mean that as a country, we will have to revisit the appropriation act for example, because the 2023 budget only [made] provision up to June.

“So, if we’re extending beyond June it means we have to revisit the appropriation act or amend the PIA. So, these are the reasons why we had to do this consultation, to get inputs from the government. They’re going to provide us their representatives to work together with us to have a defined process that will take us towards the removal”, she said.

Recall that the federal government had announced at the beginning of this year that it would be ending the era of fuel subsidy in June as stated in the Petroleum Industry Act (PIA). The government claims that the subsidy is unsustainable and rife with corruption.

The federal government also obtained a $800 million loan from the World Bank as a palliative for the removal of subsidies to 50 million vulnerable Nigerians, in order to ease the challenges that the removal could pose to the country.

Meanwhile, Asiwaju Bola Ahmed Tinubu, the president-elect, appears to agree with the Buhari administration on subsidy removal, as he repeatedly stated during his campaigns that he would not hesitate to deregulate petroleum.

However, the development elicited uncomfortable reactions from Nigerians, who feared that the removal of subsidy could crumble the livelihood of the majority of the citizens. Also, some social commentators condemned the timing of the event as many Nigerians are experiencing economic hardship, due to inflation.

In the same vein, the Nigerian Labour Congress also disagreed with the federal government on the removal of fuel subsidy. The pressure group urged the government to fix the moribund refineries in the country before taking such action, with the warning that it could set the country on fire.

However, it is not yet known if the incoming administration will make total deregulation of the downstream sector its first priority.