The Special Adviser to President Bola Tinubu on Information and Strategy, Bayo Onanuga, has explained the difference between a fuel margin discount and a government subsidy.
This comes amid controversy over the Federal Government’s proposed 30-day fuel discount.
Onanuga made the clarification in a statement posted on his X handle on Friday, explaining the difference between the two policies.
The government announced 30-day fuel discount at Nigerian National Petroleum Company Limited, NNPCL, outlets.
In the statement titled “Margin Discount and a Subsidy Are Not the Same,” the presidential aide explained that a margin discount occurs when a fuel retailer reduces or temporarily waives its profit margin to pass the savings on to consumers.
He said, “The ADC and NDC should carefully re-read this ministerial brief: Margin Discount and a Subsidy Are Not the Same.
“Every marketer adds a margin to the price it pays for the fuel it sells. A margin discount means the retailer chooses to take a smaller margin, or no margin at all, for a period, and passes the savings on to the customer. The cost of the discount is borne by the retailer alone.
“A subsidy is different. It is when the government pays part of the price the consumer would otherwise pay.
“That money comes from public revenue funds that would otherwise go to salaries, schools, hospitals and infrastructure. That is the regime this administration ended in 2023, and it is not coming back.”
