Removal of fuel subsidy will help Nigeria’s economy- RMAFC

The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has joined other government agencies and groups to support the removal of subsidy on petrol as announced by President Bola Ahmed Tinubu in his inaugural address, saying it was long overdue.

It also welcomed pragmatic steps by the Executive to provide palliative measures to cushion the attendant impact of subsidy removal on the citizens.

RMAFC Chairman, Mr. Mohammed Bello Shehu, who disclosed this in a statement described the subsidy regime as a major challenge to the economic growth and development of the country.

He recalled that the Commission had consistently expressed its position on the vexatious issue of subsidy removal since the time of late Hamman Tukur, who chaired the Commission during the administration of former President, Olusegun Obasanjo.

According to Shehu, the Commission’s position was premised on the fact that the continued payment of humongous amounts to a privileged few in the name of subsidy was a major drain on the nation’s scarce resources and consequently, stunted economic growth.

He added that the opaque subsidy regime forced the Nigeria National Petroleum Company limited (NNPCL), one of the major sources of revenue to the Federation Account, to halt contributing to the national purse.

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“As one of the 14 Federal Executive Bodies established by section 153 (1)(n) and empowered by paragraph 32 (a) and (c) of part 1 of the Third Schedule of the 1999 Constitution(as amended), RMAFC has the constitutional mandate to monitor the accruals to and disbursement of Revenue from the Federation Account and also advise Federal and State Governments on fiscal efficiency and methods by which their revenue can be increased”, the Chairman said.

He further hailed Tinubu for taking the bold step to slay the subsidy monster as there was no non-budgetary provision for it.

“It is a master stroke that broke the jinx. It is the appropriate step in the right direction.

“The country can no longer sustain fuel subsidies whose demerits far outweigh its benefits to the citizenry. It is saddening to note that since 1st January, 2022 to date, the Nigeria National Petroleum Company Limited (NNPCL) has not been contributing to the Federation Account due to the claimed subsidy payments. The total amount withheld by the NNPCL as claimed subsidies for this period amounted to N8,480,204,553,608.13 as reported by the Office of the Accountant General of the Federation (OAGF) which is yet to be reconciled by the RMAFC, OAGF, and NNPCL”.

He added that in a situation whereby the records of subsidy transactions are not transparent and crude oil prices are being determined globally, it would be unwise to sustain the phantom payments of subsidy at the detriment of other critical sectors of the economy thus making its sustainability difficult for the Government.

Mr. Shehu further emphasized that the removal of fuel subsidies will eliminate the alleged uncertainty surrounding the subsidy regime just as it will free funds for the execution of critical national development and human capital enhancement projects such as the provision of an affordable transport system, Investment in the Education Sector, improvement in Health care and infrastructural development, and resuscitation of domestic Refineries to eliminate dependence on imported fuel, amongst other key sectors.

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