In a significant move to alleviate the impact of petrol subsidy removal on citizens, President Bola Tinubu has given the green light for the establishment of an Infrastructure Support Fund (ISF) for all 36 states of the Federation. The approval was announced during the monthly meeting of the Federation Account Allocation Committee (FAAC) on July 20, 2023, in Abuja.
The newly established Infrastructure Fund aims to empower states to invest in critical areas such as transportation, agriculture (including livestock and ranching solutions), basic healthcare, basic education, power, and water resources. These strategic investments are expected to boost economic competitiveness, create job opportunities, and foster overall economic prosperity for Nigerians.
Additionally, the Committee resolved to set aside a portion of the monthly distributable revenue to mitigate the impact of increased revenues resulting from subsidy removal and exchange rate unification. This measure seeks to stabilize money supply, inflation, and exchange rates.
Out of the June 2023 distributable revenue of 1.9 trillion Naira, approximately N907 billion will be allocated among the three tiers of government, while 790 billion Naira will be saved, with the remainder used for statutory deductions. These savings will complement the efforts of the Infrastructure Support Fund (ISF) and other fiscal measures, all aimed at ensuring tangible improvements in the quality of life for Nigerians.
The Committee commends President Tinubu for the bold decision to remove petrol subsidy and, importantly, for providing necessary support to the states to mitigate the effects of the subsidy removal on Nigerian citizens.