President Bola Tinubu has approved the establishment of an Infrastructure Support Fund (ISF) for states as part of measures to cushion the effects of the petrol subsidy removal on the Nigerians.
According to a statement signed by Mr Dele Alake, Special Adviser to the President on Special Duties, Communications and Strategy, the approval was disclosed at the monthly meeting of the Federation Account Allocation Committee on Thursday in Abuja.
He said that the new Fund would enable states to intervene and invest in the critical areas of transportation, including farm to market road improvements; agriculture, encompassing livestock and ranching solutions.
Others areas are 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 also said that the committee also resolved to save a portion of the monthly distributable proceeds to minimise the impact of the increased revenues-occasioned by the subsidy removal and exchange rate unification-on money supply, as well as inflation and the exchange rate.
He said that out of the June distributable revenue of N1.9 trillion only N907 billion would be shared among the three tiers of government, while N790 billion would be saved, and the rest to be used for statutory deductions.
He explained that these savings would complement the efforts of the ISF and other existing and planned fiscal measures aimed at ensuring a tangible improvement in the lives of Nigerians.
Alake said the committee commended Tinubu for the bold decision to remove the petrol subsidy, and for providing supports to the states to cushion the effects of the removal.