Abuja – Some senators on Wednesday advocated complete removal of subsidy on petroleum products to save the nation the huge sums being spent on subsidising importation of petrol.
The senators spoke while contributing to the consideration of the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) at plenary.
They argued that even with the subsidy, petroleum products still sold higher than the regulated price in all parts of the country except Abuja, Lagos and Port Harcourt.
They also advocated for more borrowing by the Federal Government to accelerate the industrialisation of the economy.
Sen. Ben Bruce (PDP Bayelsa) said that there was no need to borrow two or three trillion Naira every year when the nation could borrow a lump sum and utilise same in industrialising the nation.
He cited Brazil which he said took loans to develop the country.
Bruce said that Nigeria should emulate Brazil and other such economic moves and spread the repayment over 50 years.
“ If you have to borrow N50 trillion, then borrow that and industrialise Nigeria over night,” he said.
On the oil benchmark of 38 dollars per barrel of oil for 2016 budget, he said that the budget should be reviewed every three months and adjusted in line with economic realities or oil prices.
Bruce also advocated the removal of subsidy, stressing that all successive governments had maintained the wrong argument on the oil sector deregulation policy.
He said that past governments focused more on price of petrol rather than the cost of transportation, and stated that a subsidised transportation policy would cushion the effect of deregulation.
“Government should ask what the price of transportation is and not how much a litre of petrol is.
“We should think of a mass transit policy which will cost no more than N100 billion which is about 10 per cent of what we spend on subsidy.
“If people spend the same amount of money on transportation after deregulation, nobody will protest on the street.
“Nobody in UK or U.S. knows the price of petrol but in Nigeria, everybody knows because we have made the wrong arguments,” he said.
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He also canvassed that states should have more money than the Federal Government, because they were closer to the people who needed to be developed.
Sen. Toyo Alasoadura (Ondo Central) also supported ‘’big’’ borrowing by government, saying, ‘’Let us borrow on a 50-year plan, develop the nation’s infrastructure and we are in safe hands.”
He said that the benchmark of 38 dollars per barrel of oil was alright, adding that a quarterly review of the budget in line with realities would be necessary.
On his part, Sen. Solomon Adeola (APC Lagos West) suggested that the Appropriation Committee should be allowed to go back and do a thorough job and advise the senate accordingly.
“The projection of N4.5 trillion as the independent revenue of the Federal Government for 2016 is a little bit on the high side.
“But, when we look at something in the region of N4 trillion, we can start looking at the realities on ground and the indices before us,” he said.
In his contribution, Sen. Dino Melaye (APC Kogi West) queried why the nation had continued to pay subsidy even when oil prices dropped from over 100 dollars per barrel to about 45 dollars.
Sen. Bassey Akpan (PDP Akwa Ibom North East) stressed the need for timely submission of the MTEF, insisting that the senate must take a fundamental stance on fuel subsidy payments.
“The issue of subsidy is not sustainable, so I believe that as a people we must understand that we have been buying petrol at N195 per litre; so, where is the benefit of subsidy,” he queried.
But, Sen. Jubrin Barau (APC Kano North) opposed the removal of subsidy, saying that it was a form of welfare package for the citizenry.
He said that even the international community which advocated the removal of subsidy had welfare packages for their citizens.
“I say no to removal of oil subsidy, it is a kind of welfare arrangement,” he said.
Barau pointed out that the major challenge in the oil sector was pipeline vandalism which had inhibited the pumping of crude to refineries and refined products to the depots.
After the debate, further consideration of the MTEF and FSP was referred to the Committee on Finance and Committee on National Planning, with one week deadline to report back. (NAN)