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Fuel Subsidy: States Kick As NNPC Continues Deductions, FAAC To Meet On Wednesday

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As the Federation Account Allocation Committee meets for the first time in 2022 on Wednesday, there are significant indicators that state and federal governments are once again at odds.

Officials from the state, speaking to our correspondents on Sunday, criticized the Nigerian National Petroleum Corporation’s continuous diversions from FAAC monies to support fuel subsidies, stating that the issue would be discussed at the meeting on Wednesday.

On Wednesday, the NNPC was set to remove N270.83 billion from the January FAAC allocations, which would be divided by state, federal, and local governments.

Asuquo Ekpenyong, Junior, the Cross River State Commissioner for Finance, verified to one of our correspondents that the FAAC meeting will take place between Wednesday and Thursday.

In its December 2021 report to the FAAC, the NNPC announced that it will deduct some monies as a value shortfall sustained by the oil company in January 2022.

During the FAAC meeting in January, the company said it would subtract N270.83 billion from the amount to be split by the three tiers of government.

It said, “The estimated value shortfall of N270,831,143,856.56 is to be recovered from December 2021 proceed due for sharing at the January 2022 FAAC meeting.

“This value shortfall consists of N220,110,853,427.56 for November and N50,720,290,429.00 deferred for recovery in December 2021 FAAC report.”

Deductions unjustifiable – Delta

Speaking ahead of the FAAC meeting, the Delta State Commissioner for Finance,  Mr. Fidelis Tilije, in an interview, said that the Finance Commissioners’ Forum had made a series of conclusive resolutions on the deductions by the NNPC to finance fuel subsidy.

According to him, state governments will continue to oppose the deductions, which he described as non-transparent.

Tilije, who chaired the finance commissioners forum’s committee on the Petroleum Industry Act, said, “The issue of removal of fuel subsidy is the Federal Government’s responsibility and not FAAC responsibility.

“Ours is to look at sources of funding and expenditure. We have made a series of conclusive resolutions on the need for subsidy to be removed on one angle and secondly to also check the NNPC because we don’t know who is checking on what kind of subsidy they are paying.

“Because they are the one collecting the subsidy and they are the one spending it.  Those issues have been queried, of course, the Federal Government is in charge of the NNPC and the NNPC also behaves like a law. Until the Federal Government can take a decision on the issue of subsidy and there is nothing anybody can do.

“But unfortunately the Federal Government is also saying that it will need the state governors to guarantee the wellbeing of the people and ensure that there is no labor strike in their various states before they can remove subsidy. Who does that?”

When asked about the stand of states ahead of Wednesday’s meeting, he stated, “We have always been kicking against it (deductions for subsidy) and we will continue to kick against it, what we are saying is that the subsidy they are paying cannot be justified.

“We don’t know the exact figure we are consuming on a daily basis but their own argument is that now the price of crude oil has gone up and if you sell the crude oil at a high price and import petrol, you will have to be buying the petrol at a high price but for me, it is not true.”

It’s injustice against Ekiti – Commissioner

On his part, the Ekiti State Commissioner for Finance, Akin Oyebode,  expressed the opposition of the state government to the deduction of money for fuel subsidy from the Federation Account without the consent of states.

Oyebode, who said he could only speak for his state, said such deductions, which exemplified the country’s flawed fiscal federalism, amounted to injustice to some states including Ekiti.

The commissioner said, “I have been on record at the various Federation Accounts Allocation Committee meetings to state my vehement opposition to the continued deduction of subsidy without subjecting it to the consent of the states”.

He suggested two options for the Federal Government to resolve the issue going forward.

Oyebode said, “The issue is very clear, if the Federal Government decides in its wisdom to operate the subsidy on petroleum products without getting the consent of states, then it should bear the cost of the subsidy 100 percent and that cost should be taken from the Federal Government’s share of the Federation Account, not deducted at source from the Federation Account.

“And in the event that we, as a country, agree to continue with the subsidy regime, then the deduction should be made in line with the consumption of petroleum products in each state.

“A situation where Ekiti, for example, that consumes less than one percent of petroleum products gets a deduction of N3bn a month, is a significant loss to Ekiti. We could have used that money to meet all sorts of different demands from our people.

“We believe that this is again another example of the flawed fiscal federalism structure that we operate. Of course, this subsidy request has been tabled at FAAC, all we get at the meetings are reports of deductions taken at the source which I very strongly believe are even unconstitutional because these are not subject to appropriation.

“The Nigerian National Petroleum Corporation, in its wisdom, just comes and reports that this is how much was taken and they call it some funny names, but we know what it is – deductions for subsidy.”

Oyebode said that a curious aspect of the whole thing was that “there is even no basis for interrogating if in truth the volume of products on which subsidy had been charged had actually even got to the consumers.”

We are not in charge of Subsidy – NNPC

But when contacted, the spokesperson of the NNPC, Garba-Deen Mohammad, told our correspondent that the issue of petrol subsidy was beyond the control of the oil firm.

He stated that with the advent of the Petroleum Industry Act, the matter of subsidy was outside the control of the NNPC but was a matter being handled by the Federal Government.

Garba-Deen said, “Subsidy is not under the control of the NNPC. The subsidy is now a PIA issue and it will be determined by the principles of the Petroleum Industry Act. Not by the NNPC.

“The NNPC is an operator now in the market, just like Shell or Chevron or like any other oil company. So I don’t know anything you are talking about.”

When probed further on whether petrol subsidy would be stopped, replied, “We are speaking the same thing, I say I don’t know. I have no idea, I am just an employee of the NNPC.”

BIG STORY

BREAKING: President Tinubu Renames University Of Maiduguri After Buhari

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President Bola Tinubu has given approval to rename the University of Maiduguri in Borno State as Muhammadu Buhari University.

May we now adopt the University of the Maduguri as the Muhammadu Buhari University, Tinubu announced at the end of a special Federal Executive Council session held to honour Buhari at the Aso Rock Villa, Abuja, on Thursday.

Earlier, the President offered a heartfelt tribute to Buhari, portraying him as a good man, a decent man, an honourable man, whose legacy of discipline, patriotism, and strong moral values would be remembered for generations.

Tinubu acknowledged that although Buhari had imperfections, his steadfast dedication to serving the nation distinguished him.

President Buhari was not a perfect man, no leader is, but he was, in every sense of the word, a good man, a decent man, an honourable man.

His record will be debated, as all legacies are, but the character he brought to public life, the moral force he carried, the incorruptible standard he represented, will not be forgotten.

His was a life lived in full service to Nigeria, and in fidelity to God, he added.

Looking back at Buhari’s leadership and long career in both military and civil service, Tinubu highlighted his humility, modesty, and resistance to the temptations of power.

He stood, always, ramrod straight; unmoved by the temptation of power, unseduced by applause and unafraid of the loneliness that often visits those who do what is right, rather than what is popular.

His was a quiet courage, a righteousness that never announced itself. His patriotism was lived more in action than in words.

Tinubu also reflected on their political partnership, which led to the historic 2015 elections, marking Nigeria’s first peaceful transition of power between political parties.

We stood together, he and I. Alongside others drawn from across the political spectrum, regions and tongues, we formed an alliance that enabled Nigeria to experience its first true democratic transfer of power from one ruling party to another.

When he was sworn in as our party’s first elected President, he led with restraint, governed with dignity, and bore the burdens of leadership without complaint, he said.

The President admired Buhari’s life after leaving office, saying he chose to live quietly in Daura rather than influence politics from behind the scenes.

When his tenure ended, he returned to Daura; not to command from the shadows or to hold court, but to live as he always had, never seeking to impose his will but content to let others carry the nation forward.

Even in death, he maintained the serenity that defined him in life: not a sigh, not a groan, just a quiet submission to the will of God. Such was the man Nigeria has lost. Such was the man for whom our nation now mourns, he added.

Tinubu expressed gratitude to the Inter-Ministerial Committee and Katsina State Governor, Dikko Radda, for putting together a state funeral in less than 48 hours, calling it a profound honour to lead the burial ceremony in Daura.

He ended his tribute with a final message: Mai Gaskiya, the People’s General, the Farmer President, your duty is done. May Almighty Allah forgive his shortcomings and grant him Aljannah Firdaus. May his life continue to inspire generations of Nigerians to serve with courage, conviction, and selflessness. President Buhari, thank you. Nigeria will remember you.

Buhari passed away on Sunday, July 13, at the age of 82.

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BIG STORY

CPC Bloc And Buharists Reaffirm Commitment To APC And President Tinubu, Call For Party Chairmanship

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In a live interview earlier today on AIT, political analyst and committed Buharist Chief Okoi Obono-Obla —former member of the National Executive Committee and Secretary of the defunct CPC Merger Committee—addressed recent speculation regarding the Congress for Progressive Change (CPC) bloc and Buharists within the All Progressives Congress (APC), following the transition of former President Muhammadu Buhari.

Responding to reports that certain former government officials are considering a move to the African Democratic Congress (ADC) or aligning with a so-called coalition, Okoi stated firmly:

“These individuals do not represent the leadership or the collective will of the CPC bloc. As a Buharist and one who participated in the foundational merger, I can confirm that the CPC bloc remains solidly within the APC and stands fully behind President Bola Ahmed Tinubu.”

He emphasized that suggestions to defect run contrary to President Muhammadu Buhari’s legacy and enduring support for the APC:

“If those advocating a move to the ADC were genuine followers of President Buhari, they would respect his clear position. Our leader has declared he remains a member of the APC and deeply appreciates the platform the party provided for his presidency from 2015 to 2023.”

Okoi also conveyed a strong demand from the CPC bloc regarding the future leadership of the APC:

> “The CPC bloc is earnestly calling for the position of the next APC National Chairman to be conceded to our bloc. We are united in our clamour for Senator Tanko Umaru Al-Makura—our respected leader and a committed party stalwart—to assume this vital role.”

This reaffirmation not only signals loyalty to President Tinubu and the APC, but also outlines the CPC bloc’s expectations for inclusive party leadership, rooted in shared history and trust.

 

@ Okoi Obono-Obla#

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BIG STORY

NELFUND To Launch Job Portal Linking Student Loan Beneficiaries To Employers By 2026

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The Nigerian Education Loan Fund (NELFUND) has revealed plans to introduce a centralized job portal by 2026 aimed at helping student loan recipients secure employment opportunities both locally and abroad.

This initiative forms part of broader strategies to strengthen the effectiveness of the student loan program and guide graduates toward financial stability.

While speaking at a media briefing in Abuja to commemorate one year since the loan scheme’s inception, NELFUND’s Managing Director, Akintunde Sawyerr, clarified that although the agency does not promise jobs, the planned job portal is intended to ease graduates’ entry into the workforce.

Sawyerr mentioned that the portal will compile job listings from government bodies, private companies, and foreign employers interested in hiring Nigerians.

We don’t just give a loan and leave students on their own. This job portal is our way of supporting their journey towards economic stability, he said

No repayment without employment

Sawyerr reaffirmed that repayment of student loans will only begin when beneficiaries secure employment and have completed their National Youth Service Corps (NYSC).

If you don’t have a job, you don’t pay. And when you eventually get a job, your repayment starts fresh.

Once employed, 10 per cent of the beneficiary’s monthly income is deducted automatically by the employer and remitted to NELFUND, following verification through the NELFUND employment register.

If an employee is laid off or resigns, the deductions stop. And in the event of death, the loan is written off. The family is not harassed, he said.

Institutions must refund duplicate payments

On the matter of students who made fee payments before NELFUND disbursed funds to their schools, Sawyerr urged institutions to fulfill their obligation and refund the affected students.

We’ve received multiple petitions from students who paid under duress, only to find their fees had also been paid by NELFUND.

Institutions must refund this money. It’s disappointing that some schools have ignored this responsibility, he said.

He further explained that anti-graft agencies have begun investigating: Investigative bodies like the ICPC and EFCC have stepped in to question certain institutions over delays or refusals to refund.

To ensure the right return of funds, he recommended: If an institution cannot refund directly to the student, they can pay the money back to us and we will ensure it gets to the rightful student.

Over 3.2 million student records in system

Mustapha Iyal, the Executive Director of Operations, shared that the Fund currently oversees over 3.2 million student records and anticipates receiving around one million additional applications by the end of 2025.

Basically, our projection right now, we have about 3.2 million students in our system.

What we’re looking at this year, from now to the end of the year, we’re looking at about one million applications. We’re not pushing. We’re not saying that it’s compulsory.

But we’re looking at how we can support one million applications to make sure that no one is dropping out of school, he stated.

What you should know

NELFUND has broadened its scope by launching a loan program that also funds vocational and technical education to empower Nigerian youth seeking practical trade skills. The pilot phase of this scheme will start in Enugu between late June and mid-July 2025.

According to Executive Director of Operations, Iyal Mustapha, the initiative will offer interest-free loans to cover tuition, transportation for attending full-time technical schools, stipends for living expenses, and even tools upon training completion.

Applications will be submitted via NELFUND’s portal, and once the system is active, applicants will be matched with certified vocational training centers in their region.

 

Credit: Nairametrics

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