President Bola Tinubu has directed the Nigerian National Petroleum Company Limited (NNPCL) to utilize the 2023 dividends designated for the federation to cover fuel subsidy expenses, as reported by The Cable. Additionally, this decision includes halting the payment of 2024 interim dividends to the federation in order to improve the company’s cash flow…..For More READ THE FULL ARTICLE HERE ▶▶
Thank you for reading this post, don't forget to subscribe!According to Daily Trust, despite Tinubu’s announcement on May 29, 2023, about removing the fuel subsidy, there are signs that the government continues to spend significant amounts on it. However, the Federal Government has persistently denied making any payments for the subsidy.
In response to public protests over widespread hardship, which included calls for the subsidy’s reinstatement, Tinubu, in a national address, reaffirmed that the subsidy would not be restored. He characterized the removal as a tough but essential choice, stressing that the subsidy had been a financial strain on the nation’s economy and impeded economic progress.
The online newspaper’s report stated that NNPCL sought presidential approval to cover the subsidy costs after exhausting various strategies to ensure a stable gasoline supply. These strategies involved tackling oil theft and vandalism, restructuring debts, postponing payments to suppliers and contractors, delaying non-essential projects, and recovering debts.
NNPCL reported to President Tinubu that these measures had not resolved the issue, and as a result, the company could no longer contribute funds to the Federation Account. Consequently, Tinubu instructed the company to allocate taxes, royalties, and other funds intended for the Federation Account to cover the fuel subsidy costs.
The report indicates that the approval was granted on June 6, 2024. NNPCL’s projections show that total fuel subsidy expenses from August 2023 to December 2024 will amount to N6.884 trillion, which would prevent the company from remitting N3.987 trillion in taxes and royalties to the Federation Account. The specific amount of dividends to be withheld or postponed has not been confirmed.
The report concludes: “The strategies, the government oil company informed the president, have failed to address the issue, stating that going forward, the company would no longer be able to remit funds into the Federation Account. President Tinubu has thus directed the company to use the taxes, royalties, and other funds designated for the Federation Account to cover the fuel subsidy expenses.”….For More READ THE FULL ARTICLE HERE ▶▶
