Be Explicit on Fuel Subsidies, Under Recovery, CSOs Tell FG

Ndubuisi Francis in Abuja

The Citizens Wealth Platform (CWP) has advised the federal government to make an explicit provision in the 2022 Appropriation Bill on how to abolish fuel subsidies, under recovery or any subsidy on petroleum motor spirit (PMS) by whatever name called or under any guise whatsoever.

CWP, a forum of non-governmental and faith-based organisations, professional associations and other citizens groups said in a publication titled: ‘Frivolous, Inappropriate, Unclear and Wasteful Estimates in The 2022 Federal Appropriation Bill’, that it unearthed a total sum of N227 billion frivolous line items in the proposed 2022 federal government budget.

It called on the government to consider domiciling the accounts of relevant Government Owned Enterprises (GOEs and agencies in sub-accounts of the Treasury Single Account (TSA) and deduct the due percentages of operating surpluses at source before transferring the residue to the GOEs and agencies.

]This, it noted, would ensure that all due operating surpluses and portions of due internally generated revenue (IGR) are deducted at source, putting the estimated guaranteed FGN operating surplus revenue of not less than N2 trillion.

The Lead Director, Centre for Social Justice (CSJ), Mr. Eze Onyekpere, while reviewing the budget proposals on behalf of the CWP, stated that the Appropriation Bill, when enacted into an Act, should contain an explicit provision abolishing fuel subsidies, under recovery or any subsidy on petroleum motor spirit by whatever name called or under any guise whatsoever.

He stated that doing so would save the country not less than N2 trillion and make the same available for the Federation Account, adding that not less than 60 per cent of the savings accruing from abolishing the subsidy should be channeled to dedicated ring-fenced (statutory) expenditure in education and health.

While calling for the full implementation of the Petroleum Industry Act (PIA) for reforms in the oil and gas sector, he stated that this will also increase revenue available from oil and gas extraction in the medium term.

He stated: “The leadership of the industry should be professionalised and the new Nigerian National Petroleum Corporation and other emerging companies should not be subjected to political pressure and distortions now or at any time in the future.

“FGN should take urgent, targeted and realistic steps to reduce insecurity across the nation so that Nigerians especially in the rural areas can go back to work. This will increase productivity and the quantum of goods and services produced in the country, reducing the demand for imports leading to a reduction in the pressure on the naira.”

Onyekpere called for a full and meticulous implementation of the rules in the 2020 Finance Act requiring automatic deduction at source of past due operating surplus from GOEs and capping cost to revenue ratio of GOEs to a maximum of 50 per cent to

50 per cent.

Advocating the strengthening of the Fiscal Responsibility Commission by amendments to extant law and policy so as to fully implement the mandate of empirically calculating and collecting due operating surplus as provided in the Fiscal Responsibility Act (FRA), Onyekpere said the government should expeditiously review tax expenditures through the 2021 Finance Act considering the huge deficit incurred by FGN and the states over the years and the level of public debt.

“It is imperative that tax expenditures be capped at not more than 20 per cent of total estimated value of each tax category. This is estimated to free not less than N2tn for the Federation Account.

“FGN’s expected revenue from minerals and mining of N2.915bn is grossly underestimated. NASS should engage the mining authorities and the Ministry of Finance to ensure that illegal and private mining of public minerals is stopped and proper accruing revenue estimates included in the budget.

“FGN’s expected revenue from electronic money transfer (formerly stamp duties) is grossly underestimated. NASS should conduct detailed hearings and seek expert advice on this revenue head to ensure that the full accruable revenue is approved. NASS should also ensure that the executive accounts for the unaccounted accruals from previous years,” he said.