FG, states, endorse total removal of fuel subsidy- (Daily Sun)

Following the controversy trailing the partial removal of petroleum subsidy, federal and states governments yesterday set up a 12-member committee to review the subsidy policy with a view to completely removing it.
The Accountant General of the Federation (AGF), Mr. Jonah Otunla, who disclosed this in Abuja after the meeting of the Federation Accounts Allocation Committee (FAAC), noted that the step was at the behest of the states whose representatives are the Finance Commissioners.

According to him, the committee is made up of six members from the Commissioners’ Forum and six members from the Accountants General Forum. The committee’s report is expected before its next meeting in April.
“The committee members expressed their opinion on subsidy and we have set up a 12-man committee comprising six members from the Commissioners Forum and six members from the Accountants General Forum to help us review the impact of subsidy on the federation account. We will make our opinion known in the nearest future,” he said.
Corroborating the AGF’s assertion, the Chairman of the Commissioners’ Forum, Mr. Timothy Odaah, said the subsidy has succeeded in pauperising the poor the more as the Nigerian populace appeared to have been deceived into clamouring for the subsidy.
“We looked at the subsidy on oil as more or less a solution worse than the problem it intends to solve. You remember that during the NACOFED meeting in Niger State, it was one of the issues we presented. Looking at it presently, you discover that it is not solving the problem, which it is meant to solve. In the first place, the Nigeria Labour Congress (NLC) and the majority of the Nigerian populace appeared to have been deceived into clamouring for the subsidy. Because syndicated projects and programmes were put in, especially with regard to easing transportation problem. And likewise, tariffs on power supply.
“But you discover now that it is the average man that suffers. You stand by the street and most of the transporters are not applying any benefit from the subsidy in what they charge. We know, of course, that the Federal Government had a good intension to subsidise transportation so that it will have an absolute benefit to the poor man and every Nigerian but you discover today that there is no reflection of that subsidy benefit.
“Besides, it is like a system that robs Peter to pay Paul, makes the rich to become richer and the poor to become poorer. For example, look at this simple analysis of econometrics. A poor man has a bicycle or a motorcycle that uses five-litre full tank.  Then you look at the subsidy granted at 50 kobo, for example. The 50 kobo on five litre motorcycle will give you N250. Then you look at a big man that has 10 cars. Each of his cars gets 1000 litres. Then multiply it by 50 kobo, what do you have? You just remove N100,000 worth of subsidy. That is what the big man enjoys. Subtract the poor man’s subsidy. What do you have?




“The same thing applies to the states. There are states that are fully industrialised and you have many industries and factories. And you use those industries in that particular place. And the people who benefit more are those states that are fully industrialised because the fuel consumption of those industries and factories in those states use more unlike the states that are under-industrialised.
“What we are advocating is that the subsidy should be removed so that every state or any member of the federating unit, sharing from FAAC will take its own money and decide to use it or grant subsidy in a level that it will be able to afford. Then you look at the issue of subsidy as it applies to individuals. The marketers are not truly showing the intension of the Federal Government because it has created a very big market for them in certain ways because transparency is not coming up.
“There are some people who are eating on the subsidy to the disadvantage of others. It is because of that we passed a resolution at FAAC and that has been the opinion of the forum of the finance commissioners that the call should be made to President Goodluck Jonathan so that he will have to reconsider this subsidy and remove it,” he submitted.
Meanwhile, the Federal Government, states and local governments shared the sum of N641,299 billion  for the month of  February. The sum of N531,332 billion was available as statutory allocation, N66,801 billion value added tax, N35,549 billion as SUPE-P and N7,617 billion as NNPC refund.
Out of the statutory allocation, the Federal Government collected N247,553 billion (52.68 per cent), states received N125,562 billion (26.72 per cent) while the 774 local governments got N96.796 billion (20.60 per cent).
The oil-producing states received N58.34 billion as the 13 per cent derivation fund.
From the value added tax, the Federal Government received N9.619 billion, states got N32,065 billion while local governments received N22,445 billion.