The National Assembly has approved KSh6.7 billion for fuel subsidy, seeking to cushion consumers from economic impacts of rising petroleum prices.
The funds will be channeled to the Petroleum ministry to cater for a fuel subsidy under the petroleum Development Levy Fund.
The Energy and Petroleum Regulatory Authority (EPRA) increased petrol and diesel prices this month by KSh5 per litre. The rise came after the State partially lifted the fuel subsidy that had stabilised fuel prices and pushed the cost of the two commodities to KSh134.72 and KSh115.6 a litre, respectively.
The new allocation is set to boost the subsidy to keep it going for longer. The MPs have also allocated KSh5 billion to the fuel subsidy for the upcoming 2022/2023 financial year.
The allocation will supplement collections through the Petroleum Development Levy that is charged at KSh5.40 on each litre of petrol and diesel sold at the pump.
Treasury Cabinet Secretary Ukur Yatani has also announced plans to revive the stalled subsidy scheme for affordable cooking gas from July, promising relief to families hit by record-high LPG prices following the Russian invasion of Ukraine.
The draft Budget Policy Statement for the year starting July now shows that the Treasury expects to fund the supply of at least 300,000 cylinders. This is, however, only a small percentage of the target of three million that was outlined in the initial plan.
The price of cooking gas jumped 48% over the last year hitting an eight-year high of Ksh 2,978 for the 13-kg cylinder.