President Bola Tinubu on Thursday approved the establishment of Infrastructure Support Fund (ISF) for the 36 States of the Federation as part of measures to cushion the effects of the petrol subsidy removal on the people.
The approval was disclosed at the monthly meeting of the Federation Account Allocation Committee (FAAC), on Thursday July 20, 2023, in Abuja, according to a statement by the Special Adviser to the President on Special Duties, Communications and Strategy, Dele Alake.
The statement listed areas into which the funds will be deployed, including enabling the States to intervene and invest in the critical areas of Transportation, including farm to market road improvements; Agriculture, encompassing livestock and ranching solutions; Health, with a focus on basic healthcare.
Other areas include “Education, especially basic education; Power and Water Resources, that will improve economic competitiveness, create jobs and deliver economic prosperity for Nigerians”
A new culture of savings was introduced, as the Committee also resolved to save a portion of the monthly distributable proceeds to minimize the impact of the increased revenues-occasioned by the subsidy removal and exchange rate unification-on money supply, as well as inflation and the exchange rate.
Out of the June 2023 distributable revenue of 1.9 trillion Naira, only N907 billion will be distributed among the three tiers of government, while N790 billion will be saved, and the rest will be used for statutory deductions.
The savings, according to the statement, “will complement the efforts of the Infrastructure Support Fund (ISF) and other existing and planned fiscal measures, all aimed at ensuring that the subsidy removal translates into tangible improvements in the lives and living standards of Nigerians.
“The Committee commends President Tinubu for the bold decision to remove the petrol subsidy, and even more importantly, for providing necessary support to the States to cushion the effects of the subsidy removal on Nigerians”
At the meeting of the National Economic Council (NEC), the Council threw its weight behind the new policy initiatives, including the planned distribution of grains and fertilizer to Nigerians by the Federal Government through the Central Bank of Nigeria to mitigate the impact of the removal of petrol subsidy on citizens.
The decision was part of resolutions reached today at the 4th meeting of the Council chaired by Vice President Kashim Shettima at the State House Executive Council Chambers, Abuja.
The decision was taken after a presentation by the NEC Adhoc Committee on cushioning the effect of petrol subsidy removal was made by Anambra State Governor, Chukwuma Soludo.
Speaking after deliberations on the presentation, Vice President Shettima stated that the Council,” will also pursue vigorously, the mass deployment of CNG-powered vehicles and establishment of Autogas conversion plants/kits in all States in the short-term and deployment of electric buses and cars with charging infrastructure across the country.”
The meeting also resolved to support enhanced engagements between State Governors and the leadership of the labour unions across the States, and proposed the provision of the cost-of-living allowances to be paid to civil servants in both the State and Federal Civil Services.
This is just as it was agreed to support federal Government’s efforts to scale up infrastructure especially to give attention to fixing dilapidated highway roads across the country.