In order to mitigate the consequences of the elimination of the fuel subsidy on Nigerians, President Bola Tinubu has approved the creation of the Infrastructure Support Fund (ISF) for the nation’s 36 states.
Dele Alake, the presidential spokesperson, revealed this in a statement on Thursday, stating that the permission came after the Federation Account Allocation Committee (FAAC)’s monthly meeting in Abuja.
The new Infrastructure Fund will give the states the ability to take action and invest in the vital sectors of transportation, including improvements to farm-to-market roads, agriculture, including livestock and ranching solutions, health, with a focus on basic healthcare, education, especially basic education, power, and water resources, which will increase economic competitiveness, generate jobs, and bring prosperity to Nigerians.
“Out of the June 2023 distributable revenue of N1.9 trillion, only N907 billion will be distributed among the three tiers of government, while N790 billion will be saved, and the rest will be used for statutory deductions,” the statement read.
“These savings will complement the efforts of the Infrastructure Support Fund (ISF) and other existing and planned fiscal measures, all aimed at ensuring that the subsidy removal translates into tangible improvements in the lives and living standards of Nigerians.
“The Committee commends President Tinubu for the bold decision to remove the petrol subsidy, and even more importantly, for providing necessary support to the States to cushion the effects of the subsidy removal on Nigerians.”
According to him, the Committee also decided to set aside some of the monthly distributable proceeds in order to lessen the effects of the higher revenues brought on by the elimination of subsidies and the unification of exchange rates on the money supply, inflation, and the exchange rate.