Don't Miss


Home   >   Business   >   Industries   >   Energy   >   FAAC insists on fuel subsidy removal

FAAC insists on fuel subsidy removal

By on July 17, 2014

Barely a week after the Senate unanimously rejected the recommendation of its Committee on Finance that subsidies on petroleum products should be totally removed, the Federation Accounts Allocation Committee on Tuesday insisted that their retention was a fraud against the country.

The Chairman, Forum of Commissioners for Finance of the 36 states of the federation, Mr. Timothy Odaah, made the position of the committee known while briefing journalists shortly after this month’s FAAC meeting.

The Senate President, David Mark, had in his remarks after the Senate had rejected the proposal for subsidy removal said, “If we sit here now and said remove subsidy; I think those who are benefitting from the subsidy regime are very powerful and tomorrow, they will influence media report and twist it to create an impression that the Senate is anti-people.”

But Odaah described the payment of fuel subsidy as a fraud against some states, especially the less industrialised ones, and likened it to a case of “robbing Peter to pay Paul.”

The Federal Government has a budget of N971.1bn for fuel subsidy payment in the 2014 fiscal year, same as in 2013.

Odaah said while the report of the 12-man committee on the review of the subsidy regime was still being awaited, the current position of FAAC was that the subsidy must be removed since the purpose for which it was established had been defeated.

The committee, which was set up three months ago to review the impact of subsidy on the Federation Account, is made up of six members from the commissioners’ forum and six members from the Accountants-General Forum

Odaah said, “The issue of subsidy removal re-echoed today and it became an issue of discussion and the report of the committee set up three months ago is being awaited, and we still stand on the removal of subsidy as it will be of much benefit to the states because what we have now is like robbing Peter to pay Paul.

“The purpose for which the government set up subsidy is being defeated, and so, it should be based on consumption.”

On revenue generation, he said there had been a tremendous improvement in non-oil revenue, noting also that the rate of oil theft had reduced.

Meanwhile, the FAAC committee at the meeting allocated the sum of N755.95bn to the three tiers of government for the month of June.

A breakdown of the allocated amount showed that N582.93bn was shared under statutory allocation; N66.414bn was distributed under Value Added Tax; while the balance of N71.04bn was shared from excess non-oil revenue.

The Minister of State for Finance, Ambassador Bashir Yuguda, who presided over the meeting, put the gross revenue received in the month of June at N784.88bn.

This, he stated, represented a decrease of N59.15bn over the N844.03bn received in the month of May.

The committee also approved the transfer of N50.35bn into the Excess Crude Account, thus bringing the balance in the account to $4.05bn.

 

 

 

[Punch]