Senate and the road fund controversy

Reports that emanated from the Senate last week raised the blood pressure of not a few Nigerians. News reports on Thursday last week indicated that the red chamber was contemplating a law that would ensure the creation of the National Road Fund.

A recommendation of the Senate committee on Works, headed by Senator Kabiru Gaya indicated that the creation of the Road Fund remains the surest option to get the numerous bad roads back in shape. In its report meant to be presented for third reading at the senate, the committee had recommended the imposition of an additional N5 extra charge on every litre of petrol and diesel consumed in Nigeria.

The report of the Senator Kabiru Gaya-led Committee which was scheduled for debate on Wednesday and equally slated on Thursday, but was shelved due to lack of time proposing the setting up of the National Road Fund, which it said would source its funds from extra costs to be imposed on imported and locally refined petroleum products.

Besides the proposed N5 Naira to be imposed on fuel users, bill equally proposes the imposition of the 0.5 percent charges deductible from the fare paid by passengers on inter-state roads.

The Senate Committee also proposed that other sources of funding for the Road Fund shall include Axle load control charges; International Vehicle Transit Charges; Roads Fund Surcharge of 0.5 per cent chargeable on the assessed value of any vehicle imported at any time into Nigeria; 10 per cent from toll fees on federal roads and 10 per cent of revenue accruing from lease or licence or other fees pertaining to non–vehicular road usages along any federal road.

Former governor of Kano State, Senator Gaya, had laid the foundation for the report on October 19, 2016, when he presented a lead debate on the Road Fund Bill, submitting that the creation of Road Fund is the solution towards problem of dilapidated roads in the country.

He had said then: “At the core to the Road Fund Solution is the concept that some of the insufficiency and unpredictability of funding (and by extension, planning), can be mitigated by extracting additional funds from those that use the road assets in the form of a user based charge or levy.”

The report immediately triggered the alarm from Nigerians across different divides. The Manufacturing Association of Nigeria (MAN), the National Union of Petroleum and Natural Gas Workers (NUPENG) and the civil society insisted that the proposal was a wrong step in the wrong direction, adding that it would lead to increment in pump price of petrol.

NUPENG, declared that the proposal amounted to a huge joke, adding that the development would add to the suffering of Nigerians.

South-West Chairman of NUPENG, Alhaji Tokunbo Korodo, who made public the union’s position said that the proposal was ill-timed and also smacked of insensitivity to the current economic hardships being faced by Nigerians on the part of the Senators.

According to him, many Nigerians were already “striving to cope with the current harsh economic realities,” adding: “How can the Senate propose such a bill at this particular period when poor Nigerians can hardly feed themselves?

“The prices of foodstuffs have tripled in the market, while workers’ salary has not been increased.”

The NUPENG boss added: “Just a year ago, the pump price of petrol was increased from N87 to N145 per litre and Nigerians accepted the increment because of the sincerity of President Muhammadu Buhari’s administration.

“Any attempt to adjust the price of petrol under any guise will be resisted by the Nigeria

Nigerians

Organised Labour.

Following a barrage of attacks from stakeholders, Senate President Bukola Saraki spoke twice to exonerate the senate of any plot to impose new fuel price on Nigerians. He was first to issue a statement through his Special Assistant on Social Media, Bamikole Omishore who declared that the proposed bill would not impose new levies on the people.

Again, the Senate President spoke to newsmen in Ilorin, the Kwara State capital, where he flatly denied that contrary to wrong interpretations in the media on a recommendation by the Senate Committee on Works, the proposed National Road Fund Bill would not lead to any increase in the current price of fuel

While speaking to newsmen in Ilorin at the weekend, Saraki said that the Senate would also during the new week discuss a motion on the interest rates being charged by commercial banks on loans to customers, particularly entrepreneurs who need borrowed funds to stay afloat and contribute to the Gross Domestic Product (GDP).

According to him, the Road Fund report emanated from deliberations during a public hearing held on the matter. He said that different stakeholders offered different opinions and expert advice during the hearing which he said centred on the maintenance of the nation’s road network regime.

Saraki had explained: “This is an opportunity to clarify the inaccurate reporting. There is a bill called the National Road Fund Bill. Our roads around the country are not adequately funded. If we are banking on the appropriations process, we will not be able to adequately fund and refurbish our roads.

“Anybody that read the full report would have known that after the public hearing, which involved stakeholders from the road and transport industry, it was recommended that N5.00 from each litre of petrol should be channelled towards our roads. However, this is not going to be additional five naira, but five naira out of the present price of N145 that Nigerians are currently paying at the pump.

“The recommendations came from the engagement with stakeholders at the public hearing on the bill. One of the conditions attached to the new charges by all stakeholders was that this five naira should not be an increase, but come from what is already existing. It is believed that the existing charges in the present price regime would be reduced to accommodate the five naira Road Fund bill.

“Nigerians should be reassured that although we have not even debated these recommendations, the committee’s report came with a clear proviso that the five naira should come from a restructuring of the existing template, which is reshuffling the taxes in the current N145— so that five naira out of this will always be pushed to develop existing roads and build new ones.”

Notwithstanding the lengthy explanations by the Senate President, not a few unionists and members of the civil society remained suspect on the exact plan by the administration as regards fuel.

Perhaps, the suspicion is a product of the fact that the administration, which had promised to review the pump price downwards during the campaigns has eventually ended up jerking it beyond the proposed figure of N140 announced by the previous government in 2012.

Last year, a hint of the planned increment in pump price of petroleum products was variously attacked with many almost taking up arms immediately.

In September 2016, the Nigerian National Petroleum Corporation (NNPC)had issued a statement to publicise the opinion of former Group Managing Directors (GMDs) of the Corporation after a meeting with the Minister of State for Petroleum, Dr Ibe Kachikwu.

The statement indicated that the past and present GMDs unanimously declared that the current N145 per litre price of fuel was no longer realistic and that the amount does not correspond with the price determining components of the commodity and the fluctuations of the foreign exchange rate.

The NNPC had read: “They (the GMDs) noted that the petrol price of N145/litre is not congruent with the liberalisation policy especially with the foreign exchange rate and other price determining components such as crude cost, Nigerian Ports Authority charges, etc remaining uncapped.”