Deregulation of PMS prices will help avert negative consequences- Buhari

President Muhammadu Buhari says there will be negative consequences if the government continued with the business of fixing or subsidising the prices of Premium Motor Spirit (PMS) known as petrol.

Buhari, represented by Vice President Yemi Osinbajo, gave this explanation on Monday while declaring open a 2-day First Year Ministerial Performance Review Retreat at the State House Conference Centre, Abuja.

The president said that the COVID-19 pandemic had led to a severe downturn in the funds available to finance the nations’ budget and also severely hampered the government’s capacity.

He said that one of the steps government taken at the beginning of the crisis in March when oil prices collapsed at the height of the global lockdown was the deregulation of PMS.

Buhari, assured, however, that government was working towards mitigating the impact of the deregulation on the citizens.

“There are several negative consequences if the government should even attempt to go back to the business of fixing or subsidising PMS prices.

“First of all, it would mean a return to the costly subsidy regime; today we have 60 per cent less revenues; we just cannot afford the cost.

“The second danger is the potential return of fuel queues – which has, thankfully, become a thing of the past under this administration.

“Nigerians no longer have to endure long queues just to buy petrol, often at highly inflated prices; also, as I hinted earlier, there is no provision for fuel subsidy in the revised 2020 budget.

“Simply because we are not able to afford it, if reasonable provisions must be made for health, education and other social services,’’ he said.

The president said that government was extremely mindful of the pains that higher prices meant at this time.

He said that the government did not take the sacrifices that all Nigerians had to make for granted.

“We will continue to seek ways and means of cushioning pains especially for the most vulnerable in our midst.

“We will also remain alert to our responsibilities to ensure that marketers do not exploit citizens by raising pump price arbitrarily.

“This is the role that government must now play through the Petroleum Products Pricing Regulatory Agency (PPPRA).

“This explains why the PPPRA made the announcement a few days ago setting the range of price that must not be exceeded by marketers.

“The advantage we now have is that anyone can bring in petroleum products and compete with marketers, that way the price of petrol will keep coming down.’’

Buhari said the recent service-based tariff adjustment by the Electricity Distribution Companies (Discos) had also been a source of concern for his government.

The president said that like many Nigerians, he had been unhappy with the quality of service given by the Discos, but there were many constraints including poor transmission capacity and distribution capacity.

Buhari said he already signed off on the first phase of the Siemens project to address many of these issues.