Governors Want States to Pay Subsidy Per Consumption

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Governor Mua'zu Babangida Aliyu

Governor Mua'zu Babangida Aliyu

The chairman of Northern Governors Forum, Governor Mua’zu Babangida Aliyu, is canvassing that if fuel subsidy is restored after negotiations with labour, states should henceforth pay according to consumption levels.

This means Lagos, which consumes an estimated 60 per cent of petrol in Nigeria, would pay most of the N1.3 trillion subsidy, even though its share from deregulation savings is estimated at a mere N10 billion.

Aliyu, who was part of the negotiating team yesterday, was said to have argued that Northern governors were not in favour of the old subsidy payment regime which was usually deducted from the federation account before allocations were shared.

According to sources at the meeting, Aliyu said there were not many cars in Northern Nigeria and it would not be equitable for all the states to contribute to the subsidy fund equally when consumption is mainly in the South.

Aliyu’s argument may re-ignite the debate about fiscal federalism, as Lagos State has also been canvassing that the Value-added Tax (VAT), most of which is generated by consumption in Lagos, should not be shared among all the states of the federation.

In the meantime, Delta State Governor, Dr. Emmanuel Uduaghan, has inaugurated 100 Hiace Toyota buses to cushion the effects of the removal of fuel subsidy.

He also directed commercial transporters to revert to the old transport fares before the subsidy removal.

He set up a three-man palliatives committee on the removal of fuel subsidy with Mr G. O. Onosode as chairman, as wellas Chief Philip Asiodu and Mrs. Elizabeth Adegite as members with the mandate to monitor the implementation of the proceeds from subsidy removal in the state.

Uduaghan said: “l appeal to transport operators in the state mass transit scheme to revert back to the old fares charged before the removal of fuel subsidy as my administration will subsidise the fares for the next six months.

“In support of the operations of these vehicles and to further reduce the pressure of the recent transport fare adjustment on commuters. The state government has decided to subsidise passengers fares on the vehicles”.

He promised that the state government would take care of the increase that has occurred after the removal of fuel subsidy for the benefit of Delta citizens.

Governor Uduaghan stated that his administration would take delivery of 50-seater Marcopolo buses and 130 boats for the riverine communities in the next few weeks as palliative measures.

“So far we have a total of 100 salon cars for taxis and over 500 buses in the scheme deployed to various areas of the state to improve on the transport sector and reduce the stress associated with daily movement of Deltans.”


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