In a bid to mitigate the impact of petrol subsidy removal on the Nigerian populace, President Bola Tinubu has given his nod to the establishment of the Infrastructure Support Fund (ISF) for all 36 States of the Federation.
The announcement was made during the monthly meeting of the Federation Account Allocation Committee (FAAC) held on Thursday in Abuja. The newly approved Infrastructure Fund is set to empower states to invest in critical areas such as transportation, agriculture, health, education, power, and water resources.
The ISF aims to enhance transportation networks, particularly by improving farm-to-market roads, and foster the growth of agriculture through the implementation of livestock and ranching solutions.
Additionally, the Fund will focus on bolstering basic healthcare and basic education, as well as improving power and water resources infrastructure. These measures are expected to boost economic competitiveness, generate employment opportunities, and ultimately contribute to economic prosperity for Nigerian citizens.
In tandem with the establishment of the Infrastructure Support Fund, the FAAC has also decided to allocate a portion of the monthly distributable revenue to mitigate the impact of increased revenues resulting from the subsidy removal and exchange rate unification. This move is aimed at managing money supply, inflation, and the exchange rate.
Notably, out of the 1.9 trillion Naira distributable revenue recorded in June 2023, only N907 billion will be disbursed among the three tiers of government. The remainder, totaling 790 billion Naira, will be saved, while the rest will be utilized for statutory deductions.
These savings will complement the initiatives introduced by the Infrastructure Support Fund and other existing and planned fiscal measures. The collective efforts are focused on ensuring that the subsidy removal translates into tangible improvements in the lives and living standards of Nigerians.
The FAAC lauded President Tinubu for his bold decision to remove the petrol subsidy, emphasizing the significance of providing essential support to the States in cushioning the effects of the subsidy removal on the citizens.
The approval of the Infrastructure Support Fund and the commitment to poverty elimination programs signal a proactive approach by the government in addressing the challenges posed by the subsidy removal and pave the way for potential socio-economic progress in Nigeria.