President Bola Tinubu has authorized the creation of an Infrastructure Support Fund (ISF) for states as part of steps to mitigate the effects of the withdrawal of petrol subsidies on Nigerians.
According to Mr Dele Alake, Special Adviser to the President on Special Duties, Communications, and Strategy, the permission was announced during the Federation Account Allocation Committee’s monthly meeting on Thursday in Abuja.
He stated that the new Fund will allow states to intervene and invest in essential transportation areas such as farm-to-market road upgrades and agriculture, including cattle and ranching solutions.
Other areas of concentration include health, with a focus on basic healthcare; education, particularly basic education; and electricity and water resources, which would increase Nigeria’s economic competitiveness, generate employment, and bring economic prosperity.
Alake further stated that the committee decided to set aside a portion of the monthly distributable earnings in order to mitigate the impact of higher revenues caused by subsidy removal and exchange rate unification on money supply, inflation, and the exchange rate.
He stated that only N907 billion of the June distributable revenue of N1.9 trillion will be split among the three levels of government, with the remaining N790 billion kept and utilized for statutory deductions.
He explained that these savings would complement the efforts of the ISF and other existing and planned fiscal measures aimed at ensuring a tangible improvement in the lives of Nigerians.
Alake said the committee commended Tinubu for the bold decision to remove the petrol subsidy, and for providing supports to the states to cushion the effects of the removal.
