Editorials

Refine fuel subsidy use

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An attendant at a fuel station in Nairobi. FILE PHOTO | NMG

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Summary

  • The energy regulator on Thursday reinstated fuel subsidy after State House intervention, cutting pump prices for the first time since June.
  • There should be clear laws guiding the collection and implementation of the fuel subsidy.
  • How the subsidy works should not be the discretion of State House and ministry officials.

It is commendable that the government reduced prices of fuel in the latest monthly review, giving consumers the much-needed relief as households reel from the economic fallout occasioned by Covid-19.

However, this is not enough as it will not solve the problem permanently. This paper has argued before that Kenyans need to know how the fuel subsidy scheme works.

The energy regulator on Thursday reinstated fuel subsidy after State House intervention, cutting pump prices for the first time since June.

The Energy and Petroleum Regulatory Authority (Epra) cut petrol and diesel prices by Sh5 per litre while kerosene dropped Sh7.28.

Officials from the Ministry of Petroleum and Epra had sought the intervention of State House for a return of the subsidy, which was dropped last month.

There should be clear laws guiding the collection and implementation of the fuel subsidy.

As we've said before, maintaining tight control of fuel prices will definitely help offset commodity price fluctuations, expand energy access, protect poor households' incomes, and spur industrial growth.

How the subsidy works should not be the discretion of State House and ministry officials.