Following the failure to remove the subsidy on petrol, the Federal Government has revised the 2012 budget proposal, of which it intends to spend N888.1 billion as subsidy on petrol and kerosene this year. In the revised proposal, the government cut aggregate expenditure by N100.25 billion, to bring total expenditure for the year to N4.648 trillion, down from the N4.749 trillion in the budget proposal submitted last December by President Goodluck Jonathan.
Minister of Finance and Coordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, who briefed journalists in Abuja, Wednesday, said the new petrol price had implications on the 2012 budget. The minister explained that the 2012 Fiscal Framework earlier submitted to the National Assembly had assumed 100 per cent subsidy removal with only N155 billion provided for carry-over of 2011 subsidy payments. Giving a breakdown of the N888.1 billion built into the revised budget, the minister said that the subsidy on petrol and kerosene in 2012 is N656.30 billion, while N231.8 billion is a carryover from outstanding payments for 2011.