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Sunday, May 19, 2024

Senate Scraps FERMA, Steps Down Bill On N5 Fuel Levy

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With the bill establishing Federal Roads Authority passed into law on Thursday, by the Senate, Federal Roads Maintenance Agency (FERMA) has been scrabed.

The Federal Roads Authority bill and that of Federal Roads Funds have been in the works for quite some time, with the latter running into media controversy last week and was later rejected.

Revisiting the bill which were stepped down last week, the FRA was seamlessly passed into law by the upper chamber.

The lawmakers had stepped it down last week following disagreement over the qualification of the Director of Works.

Senate may have brushed the issue aside as the bill was read for the third time and passed.

When the law becomes operational, the proposed agency would replace Federal Road Maintenace Agency {FERMA} to deal with the challenges of road infrastructure in Nigeria.

The bill is sponsored by Senator Kabiru Gaya representing Kano South who is also Chairman, Senate Committee on Works.

Senate, however, rejected report on National Road Funds; stepping it down for further legislative action.

DAILY POST had reported that the proposed Road Funds bill had generated controversy over alleged plans to introduce an additional N5 fuel levy to fund road maintenance.

Speaking in favour of the bill, Gaya explained that it would “provide a predictable funding for roads in Nigeria.”

He said it would create environment for effective participation of Public-Private collaboration.

He denied plan to introduce additional N5 fuel levy, pointing out that the proposed N5 is to be deducted from the existing template of N145 per litre of fuel.

He said the idea of road funds is not new, citing examples from countries like Tanzania, Kenya, Ghana, Malawi, Togo and United States of America that generate funds from fuel levy.

According to Gaya, Nigeria can generate N94 billion annually from fuel levy to help fund roads in the country.

He said the levy will be paid directly into signatory account of the National Road Funds; adding that Customs shall be responsible for the remittance.

Senator Kabiru Marafa representing Zamfara Central, however, disagrees with Gaya’s explanation.

He said it is not entirely correct that the proposed N5 fuel levy is captured in the industry template.

Marafa warns that the plan to introduce N5 fuel levy would further put pressure on an already stressed petroleum downstream sector and cause hardship for the people.

He advised the Committee on Works to explore other areas such as toll fee or any other road taxes, cautioning strongly against fuel levy in whatever guise.

Deputy Senate President, Ike Ekweremadu who presided over plenary added his voice to the denial that Senate has plans to increase pump price.


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