Government Scraps FERMA, Replaces It With New Agency

The Federal Roads Maintenance Agency (FERMA) has been abolished by the Senate. This took effect after the bill establishing Federal Roads Authority passed into law on Thursday.

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

When the law becomes operational, the new agency would replace FERMA } in dealing 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. The proposed Road Funds bill had generated controversy over alleged plans to introduce an additional N5 fuel levy to fund road maintenance.

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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.

 

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