Effect of Full Subsidy Removal on Socio-economic Development of Ebonyi State: A study of Selected Local Government Areas

Abstract

The study examined the effect of fuel subsidy removal on socio-economic development of Ebonyi State with focus on selected Local Government Areas. Descriptive survey design was adopted to study a population of 3,287,122 reduced to a sample size of 400 using the Taro Yameni formula. Data for the study was collected from primary source. Structured questionnaire instrument was adopted. The data collected for the study was analyzed using the Simple percentage and frequency distribution tables while Pearson’s Product Moment Correlation through Statistical Package for Social Sciences (SPSS) Version 2.1 was adopted to test the hypotheses that guided the study. Findings from the study revealed that fuel subsidy removal has significant negative effect on per capita income of people, food availability, cost of transportation, access to quality healthcare services, and survival of small scale businesses in the selected Local Government Areas of Ebonyi State. The implication is that fuel subsidy removal has significant negative effect on socio-economic development of Ebonyi State. The study recommended that there is urgent need for government to provide adequate social safety nets such as grants to households in order to cushion the effects fuel subsidy removal has on income and livelihood of people in Ebonyi State, there is need for government to invest in agricultural development in order to boost food production thereby enhance food security in the state, and there is need for government to engage in local refining of fuel in order to boost availability and cost reduction for fuel subsidy thereby reducing cost transportation in the selected Local Government Areas of Ebonyi State, and there is need for government to regulate the cost of healthcare services especially in the public healthcare institutions in order to increase access to quality healthcare services among others.