APC Campaign Council Demands Legal, Fiscal Details of Atiku’s Petrol Subsidy Plan

By Nafiu Muhammad Lema

The All Progressives Congress Presidential Campaign Council (APC-PCC) has challenged African Democratic Congress (ADC) presidential candidate, Atiku Abubakar, to explain the legal, fiscal and operational framework of his proposed production subsidy for locally refined petrol.

Atiku had proposed a production-based subsidy targeted at petroleum products refined in Nigeria and sold to Nigerian consumers, saying the intervention would reduce production costs and ultimately lower pump prices. He said the scheme would have a spending limit, require National Assembly approval and be independently audited.

However, in a statement issued on Sunday and signed by its spokesman, Dele Alake, the APC-PCC questioned how the proposal would operate within the Petroleum Industry Act (PIA) 2021.

The council cited Section 205(1) of the PIA, which provides for market conditions to determine wholesale and retail petroleum prices, and argued that Atiku must clarify whether refiners benefiting from the proposed subsidy would be required to sell petrol at a prescribed price.

“If the answer is yes, he should identify the legal framework under which the government would impose that price condition and explain how it would operate consistently with the Petroleum Industry Act,” the council said.

It added that if refiners would not be subjected to a prescribed price, Atiku should explain how government support to producers would guarantee lower prices at filling stations.

The APC-PCC also demanded details of the financial implications of the proposal, particularly if government would supply crude oil to domestic refineries at preferential prices.

According to the council, any discount on crude supplied to local refiners could reduce revenue accruing to the Federation and, consequently, funds available to the federal, state and local governments.

It said the proposal should therefore clearly state the subsidy rate, annual spending ceiling, volume of crude or petrol covered, source of funding, mechanism for ensuring lower pump prices and safeguards against diversion, smuggling and fraudulent claims.

The council also questioned whether amendments to the PIA would be necessary to implement the proposal.

“An appropriation by the National Assembly may authorise expenditure, but it would not by itself resolve every regulatory question arising under the Petroleum Industry Act,” it said.

The APC-PCC further challenged Atiku to reconcile his current position with his previous support for downstream petroleum deregulation.

The council recalled that Atiku had previously described the petrol subsidy system as fraudulent and pledged to complete its removal, before later announcing his intention to introduce a production subsidy model.

Atiku has argued that his proposal differs from the former import-based subsidy regime because it would support domestic refining rather than imported petrol. He has also said subsidised crude would be subject to verification and domestic supply requirements.

The APC-PCC, however, said Nigerians deserved a detailed policy document and independent legal and fiscal assessment of the proposal before its implications could be properly evaluated.

The council also highlighted the Tinubu administration’s focus on alternative energy transport, including compressed natural gas (CNG) and electric buses, as an alternative approach to reducing transportation costs.

It said the administration had converted more than 120,000 vehicles to CNG and was working with state governments to expand the programme.

The council acknowledged the pressure of higher petrol prices on households but maintained that the government would continue pursuing measures aimed at reducing transportation and energy costs.

It also said the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) was working with the Federal Competition and Consumer Protection Commission on alleged price-gouging and with the Nigeria Customs Service to address cross-border diversion of petroleum products.

The APC-PCC concluded that any intervention in the downstream petroleum sector should be lawful, transparent, properly costed and capable of delivering measurable benefits to consumers.

“Until he does so, his production-subsidy plan remains an uncosted promise without a clearly identified legal or operational framework,” the council said.