Fuel price hike: Tinubu approves Infrastructure funds for states

In an effort to lessen the painful effects of the elimination of fuel subsidy, President Bola Ahmed Tinubu has approved the creation of the infrastructure Support Fund (ISF) for states around the federation.

Dele Alake revealed this in a statement on Thursday night, stating that the approval took place at the Federation Account Allocation Committee (FAAC) meeting on Thursday, July 20, 2023 in Abuja.

The presidential spokesperson explained that the fund will allow states “to intervene and invest in the critical areas of Transportation, including farm to market road improvements; Agriculture, encompassing livestock and ranching solutions; Health, with a focus on basic healthcare; Education, especially basic education; Power and Water Resources, that will improve economic competitiveness, create jobs and deliver economic prosperity for Nigerians.”

Alake detailed that the Committee also decided to set aside some of the monthly distributable proceeds in order to lessen the effect that the increased revenues—caused by the elimination of subsidy and the unification of exchange rates—would have on the money supply, inflation, and the exchange rate.

From the 1.9 trillion Naira in distributable revenue for June 2023, only N907 billion will be divided among the three levels of government; the remaining N790 billion will be preserved and utilised for mandatory deductions.

He said that the savings will supplement the work of the Infrastructure Support Fund (ISF) and other ongoing and upcoming fiscal measures, all of which aim to ensure that the elimination of the subsidy results in real improvements in the lives and living conditions of Nigerians.

The development follows widespread criticism against the initially planned N8,000 palliative measures.

Recall that President Bola Tinubu had initially announced plans to share N8,000 to 12 million Vulnerable households; a move which many Nigerians kicked against.