November 18, (THEWILL) – The Federation Account Allocation Committee (FAAC) Post-Mortem Sub-Committee has noted with serious concerns, the nation’s rising public debt, describing it as worrisome.
“The rising level of public debt and the increasing ratio of debt service to revenue is worrisome”, the Committee said in a communiqué, issued at the end of a three-day retreat, to evaluate issues emanating from the Federation Account from January 2019 to September 2022, declared that the payment of fuel subsidy is unsustainable.
The communiqué noted that the contribution of oil revenues to the Federation account revenues had been challenged by structural constraints bedevilling the oil sector, including the unsustainable subsidy on petrol.
It advised that “downstream operations of the petroleum industry be fully deregulated to provide for the removal of subsidy.
“Nigeria cannot continue to sustain the provision of subsidy on PMS because of the negative impact it has on the nation’s revenue. Accordingly, subsidy on PMS should be phased out.
“Revenue proceeds accruing from subsidy removal should be used for the benefit of the entire population and should be put to projects having direct impact on the citizens such as Education, Healthcare, Skill acquisition, etc”, it added.
The Committee called for the reduction in the cost of governance, and advocated prudent management and transparency in all tiers of government.
Speaking at the retreat, the Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Mohammad Shehu, queried the non-remittances of revenue from some Government-owned Enterprises to the Federation Account.
He said there was a need to improve the revenue generation from the non–oil sector to the Federation Account.