Tariff increase is for Nigerians consuming 12 hours electricity per day – Buhari

President Muhammadu Buhari has stated that only customers who get electricity for 12 hours and above per day would have their tariff increased.

Buhari said this on Monday, September 7, during his second-term First Year Ministerial Performance Review Retreat in Abuja.

The First Year Ministerial Performance Review Retreat focuses on examining the performance of the ministers and other officials in the President’s cabinet.

Buhari also said the government revenue had shrunk by 60 per cent due to the COVID-19 pandemic but the government was not considering borrowing to fund subsidy for electricity and petrol.

He said that it is “grossly irresponsible” to borrow to subsidise electricity tariff amid the economic crunch caused by the lockdown occasioned by the COVID-19 pandemic.

READ ALSO: FG approves increase in electricity tariff

He also said no provision was made for fuel subsidy in the Revised 2020 Budget, noting that about N1.7trn has been spent on tariff shortfalls to support the electricity sector since its privatisation.

Buhari, who was speaking through the Vice President Yemi Osinbajo said, “The COVID-19 has led to a severe downturn in the funds available to finance our budget and has severely hampered our capacity.

”One of the steps we took at the beginning of the crisis in March when oil prices collapsed at the height of the global lockdown was the deregulation of the price of premium motor spirit such that the benefit of the lower prices at the time was passed on to consumers.

“The effect of the deregulation is that pump prices of petrol will change with the changes in global oil prices. This means quite regrettably that as oil prices go higher, we could see some increases in pump price. This is what has happened now when global prices rose, it meant that the prices of petrol locally will also go up.

“Also, there is no provision for fuel subsidy in the Revised 2020 Budget simply because we are not able to afford such a cost.

“If reasonable provision must be made for health, education, and other social services, we simply cannot sustain petroleum subsidies.”

“The recent service-based tariff adjustment by the discos has also been a source of concern to many of us. Let me say frankly like many Nigerians, I have been very unhappy with the service by many of the discos. But there are many constraints including poor transmission and distribution capacities. I’ve already signed off the first phase of the Siemens Project to address many of these issues.

“Because of the problems of the privatisation exercise, the government has had to keep supporting the largely privatised electricity industry. So far, to keep the industry going, we have spent close to N1.7trn especially by way of supplementing tariff shortfalls. We simply do not have the resources at this time to continue in this way. And it will be grossly irresponsible to borrow to subsidise generation and distribution which are both privatised.”

Daily Times reports that the increase in fuel price and electricity tariff have attracted reactions from Trade Union Congress and civil societies, organisations and labour unions.

FG approved the increase in August 28 and trade unions have made a decision to set to hold nationwide protests this week.