Reps Begins Public Hearing On 5% User’s Charge On Pump Price Of Petrol, Diesel Under FERMA Act, 2007

• Directs NMDPRA to remit to FERMA.

The Ad-hoc Committee, constituted by the Nigerian House of Representatives on Monday, began an investigative public hearing on the implementation and remittance of the 5% user’s charge on pump price of Petrol and Diesel.

The FERMA Act, 2007 provides for a 5% user’s charge on the pump price of petrol, diesel and of which 40% will accrue to FERMA and 60% to be utilized by the established State Roads Maintenance Agencies.

A statement signed by Mrs. Maryam M. Sanusi, Director (Information/PR), noted that the Ad-Hoc Committee had earlier invited the Federal Roads Maintenance Agency (FERMA), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and other stakeholders to the hearing.

The representative of the Chief Executive Officer of NMPDRA, Engr. Farouk Ahmed (represented) in his submission affirmed the non-implementation of the 5% user’s charge due to the unavailability of the modalities for the collection of the allocated fund.

He stated that the Commission is ready to implement the enacted law once the modalities are put in place.

The Chairman of the Ad-Hoc Committee, Hon. Francis Waive, in his remarks stated that the implementation of the 5% user’s charge would go down in history as one of the achievements of the 10th House of Representatives and the Committee with the help of stakeholders would establish the true status of the user’s charge and ensure accountability, compliance with the statutory obligations and ultimately that Nigeria and Nigeria roads would benefit from the funding mechanism clearly provided for in the Law.

The Chairman directed the Nigerian Midstream and Downstream Petroleum Regulatory Authority to provide an estimate of the 5% user’s charge since its enactment in 2007 has established that the law has been faulted.

Speaking at the hearing, the Hon. Minister of State for Works, Bello Muhammad Goronyo, Esq. said “under the visionary leadership of President Bola Ahmed Tinubu, GCFR, the Federal Ministry of Works remains steadfast in the Renewed Hope Agenda which is dedicated to delivering a world-class infrastructure that fosters economic growth, strengthens connectivity and enhances the daily lives of citizens”.

He said the Ministry of Works would ensure the 5% user’s charge as enshrined in the FERMA Act, serve its intended purpose of building and maintaining roads that empower the Nigerian people and drive economic prosperity.

The Managing Director/CEO FERMA, Dr. Emeka Agbasi, FNSE, in his submission, raised the justification for the remittance of the 5% user’s charge to the Agency, stating that the Agency have been underfunded with only the annual budgetary allocations which provides 20% of FERMA’S Financial requirement.

He added that user’s charge is a common and effective mechanism globally for funding of road infrastructure maintenance.

To fully realize the 5% user’s charge, Dr. Agbasi urged the Committee to include clear and mandatory provisions for the collection, administration, and auditing of the 5% user’s charge, create a FERMA Road Fund Account, and full enforcement of the existing FERMA Amendment Act.

He said, ”5% user’s charge on Petrol and Diesel as outlined in the FERMA (Amendment) Act, 2007, remains a critical, yet underutilized policy tool for addressing Nigeria’s road infrastructure crises.”