The approval by the House of Representatives for a Federal Government (FG) N500bn virement for subsidy palliative has been greeted with mixed reactions. The National Assembly equally approved a US$800m IMF loan, a request made by the President’s predecessor, but which was unattended to by the previous National Assembly, considering that the application was made only nineteen days before the end administration’s tenor. Analysts argue that the resort to a virement was due to the delay in the formation of the President’s cabinet, a situation which prevented the presentation of a bill for budget supplementation. Looking at the implications of the subsidy palliative for households, Analysts have reacted to the cash transfer scheme which provides for an N8,000 ($10) monthly transfer for six months to approximately 12 million households (through digital accounts and wallets).
Policy observers criticize the choice of cash transfers, they recommend investment in alternative energy infrastructure such as gas and solar energy, to reduce transport costs. Analysts argue that the N500bn spent through cash transfers is largely inadequate to reduce the adverse effects of subsidy removal on the family unit. But if the government decides to proceed with the cash transfer program, analysts maintain a need for transparency and accountability in selecting eligible households, suggesting that the National Social Register be audited and published to capture all vulnerable and poor Nigerians. According to the National Bureau of Statistics (NBS) 2019 Poverty and Inequality Report, an average of 4 out of 10 individuals in Nigeria live below $1 per day; analysts believe many more households should be eligible for the palliatives. Stakeholders also raised concerns about the N70bn allocation meant to support the working conditions of National Assembly members. Policy wonks reaffirm the importance of austerity measures in the overall management of government.
