The Chairman of the House of Representatives Committee on Finance, Mr. James Faleke, has stated that the government can no longer subsidize power in Nigeria.
The comment was made during the budget defense of the Ministries of Finance and other financial institutions in Abuja.
Mr. Johnson Akinnawo, the Acting Managing Director of the Nigerian Bulk Electricity Trading (NBET), announced that N705 billion has been allocated for electricity subsidies in 2025.
He has allocated two hundred and seventy-seven million naira for staff welfare in 2024.
This has attracted scrutiny from lawmakers, who have raised concerns regarding the increase from the N450 billion allocated in 2024, particularly considering the escalating electricity tariffs in the nation.
The committee chairman, Mr. James Faleke, inquired of the Managing Director whether the government continued to provide funding for the Discos. He responded affirmatively.
The federal government consistently addresses the disparity between the tariff permitted for the distribution companies and the cost-reflective tariff as determined by the commission, in accordance with their periodic guidance. Mr. Akinnawo stated that the Delta is supported by federal government appropriation, as outlined in the 2025 budget, which indicates that the federal government can fulfill an obligation of up to seven hundred and five billion naira.
Mr. Faleke promptly stated that, in light of the naira’s floating and the consistent rise in electricity tariffs, the subsidy amount has become unnecessary.
The proposed N277 million welfare allocation in NBET’s 2025 budget has been flagged, with the committee indicating that it will be removed from the NBET budget.
