Commissioners of Finance of the 36 states of the federation yesterday called for the removal of fuel subsidy saying it does not reflect on the living condition of Nigerians.
The chairman of the Forum and commissioner of finance of Ebonyi state, Mr. Timothy Odaah, while fielding questions from journalists in Abuja said the subsidy on oil as a solution is worse than the problem itself, adding that many Nigerians have been deceived into clamouring for subsidy.
“For instance, you discover that it is the average poor man that suffers. Most of the transporters are not applying any form of subsidy in what they charge. It is like robbing Peter to pay Paul, making the rich to grow richer and the poor to grow poor,” Odaah said.
He insisted that because subsidy is eating into the nation’s crude reserve, it has affected the resources of many states.
“What we have today is $3.45 billion and it is because certain measures were followed otherwise by the end of the month of April, you will be discovering a situation where states allocation will have been deducted in order to pay subsidy.
Odaah said that the Central Bank’s directive on the Credit Reserve Ratio (CRR) is a deliberate creation of artificial scarcity.
While decrying the situation where the three tiers of government find it difficult to borrow money because the coupon rate has gone up, Mr. Odaah likened the Apex bank’s decision as “artificial scarcity created by a manipulated means”.
The Central Bank of Nigeria (CBN) had increased the CRR to 75 per cent.
He therefore called for a reduction of the CRR as the cost of funds is going so high that the states can no longer cope.
Meanwhile, the three tiers of government shared N641.299 billion for the month of February.
The amount is higher than the N629.128 billion distributed in January by N12.171 billion.
For the month of February, the Federal Government got N247.533 billion representing 52.68 per cent. States got N125.552 billion which is 26.72 per cent. While the Local Governments went home with N96.795 billion which is 20.60 per cent. Furthermore, 13 percent derivation revenue distributed to the three tiers of government was N56.384 billion bringing the distributable revenue to N526.265 billion.
Briefing journalists after the FAAC meeting, Accountant-General of the Federation, Mr. Jonah Otunla noted that the increase revenue was boosted by “an exceptional payment of N82billion by Nigerian Petroleum Development Company (NPDC).”
