N634 billion has been paid by the Federal Government between 2010-2012 as subsidy for kerosene importation over a three year period, a sum which is about a third of the country’s capital budget.
Although the government pays subsidy every year, only retail outlets of the Nigerian National Petroleum Corporation sells at the subsidized rate of N50 per litre, signifying the now obvious corruption in the management of the Petroleum Subsidy Fund, PSF.
Economic analysts wonder why the product remains subsidized, since it is not being sold at regulated price, calling for appropriate measures to be taken, before its adverse effect on the economy becomes too much to absorb.
The Chairman, House Committee on Petroleum (Downstream), Dakuku Peterside, disclosed this yesterday, at the Lagos Chamber of Commerce and Industry, LCCI Petroleum Downstream Group Seminar on Kerosene.
Peterside, who gave a breakdown of what made up the figures, revealed that in 2010, Nigeria spent over N110.068 billion to subsidise kerosene.
“There were also some investigations that showed that the downstream sector is entrenched in deep corruption in Nigeria in the 2011. That year, we spent about N324.1billion on kerosene subsidy. In 2012, although we are yet to reconcile this, we spent N200billion subsidising kerosene.
“And so in three years, we’ve spent N634 billion subsidising kerosene which one third of what we spend in a year of capital budget. But we do not spend up to N4.5billion on capital budget in a year,” Peterside said.