21 April 2014, Abuja – The decision to completely remove oil subsidy from the books of the Federation Accounts Allocation Committee (FAAC) enjoyed an overwhelming support by all the states of the federation.
In fact, none of the opposition controlled states voiced any objection to the resolution at its last meeting, it was further gathered.
That ordinarily should provide a smooth sailing to the eventual ratification of the FAAC resolution by the presidency given that the latter had severally indicated its willingness to halt the subsidy scheme. Yet, it remains to be seen if the opposition political parties particularly the All Progressives Congress (APC) would condemned the planned removal on account that it would bring more suffering to the people when it effectively backed the move for the stoppage.
But emerging threats by the labour unions which are against current efforts to end the subsidy have the potential of igniting the flame of crisis in the country if a compromise is not reached by all stakeholders. During the March FAAC meeting, the committee had constituted a sub-committee to among other things investigate and enlighten members on the performance of the existing subsidy scheme.
Consequently, at its plenary last week, it finally took a decision, after being briefed by the ad hoc investigation committee that petroleum subsidy should be scrapped in its entirety “because we’ve discovered it is more or less a solution worse than the problem it tends to solve.”
THISDAY gathered that the decision by the states to throw their weight behind the removal of fuel subsidy may not be unconnected with the continued decline in monthly statutory mineral revenue occasioned by oil theft, bunkering and other distortion in production activities.
As a result, allocations from the federation account no longer suffice to execute the ever- enlarging infrastructural needs of the states and local governments which are unable to provide the much-needed jobs and execute people-oriented contracts with little resources.
Documents showed that monthly net statutory allocations to states had been on a decline in recent times averaging about N1.5 billion from between about N2 billion in some states.
– This Day