The Minister of Works and Housing, Babatunde Fashola (SAN), has stated that the approval of phase two of the Nigerian National Petroleum Company Limited (NNPC) Road Infrastructure Tax Credit Scheme will ensure the sustainability of funding of critical infrastructure in Nigeria.
Fashola, who spoke in Abuja, noted that unlike in the past, when there was inadequate funding of infrastructure, the administration of President Muhammadu Buhari, had identified alternative sources of funding that could guarantee sustainability from the beginning of the projects to their complet
He explained that the tax credit scheme remains a new model that encourages partnership with private companies where taxes are paid in advance to enable the government invest in notable projects that would be beneficial to its citizens.
The minister who also mentioned that the federal government has focused on nine major axes of Nigeria, explained that the A1 – A4 axis cover the Northern part of the country, while the A5-A9 axis cover the East and West of the country
He explained that the successful completion of all the roads would lead to sustainable mobility for Nigerians.
“The roads like Akure – Ado –Ekiti and East-West which people have been complaining about would be adequately catered for with the approval of the second phase of the NNPC Tax Credit Scheme,” he said.
On payment of compensation, Fashola noted that it would not be paid to anyone occupying the government’s Right of Way (RoW) and appealed to members of the communities occupying the areas to vacate.
Earlier, in his introductory remarks, the Permanent Secretary, represented by the Director overseeing the Office of the Permanent Secretary, Folorunsho Esan, recalled that in line with the Executive Order 7 (2019), phase one was approved on October 27, 2021.
He stated that with the completion of phase one, the Federal Executive Council (FEC) has also approved phase II of the scheme to fund 44 critical road infrastructure to the tune of N1.96 trillion naira.
Speaking further, Esan said that as it was done with phase one, phase two would be governed by a set of guidelines to be issued to each contractor, adding that there would be a funding intervention agreement to be implemented in addition to the standard condition of the contract governing the execution of the projects.
He said that the availability of this new funding window will ensure steady cash flow and a timely completion of projects.
He also stated that the NNPC intervention which began in October 2021 with phase one has now occupied the top of the log with a portfolio well in excess of N2.6 trillion.
On the part of NNPC, the Group Chief Executive Officer, Mallam Mele Kyari, who was represented by the Chief Financial Officer, Umar Aliya, said that funding would not be an issue anymore as the company is committed to fully funding the next phase.
“We are committed to setting aside funds for phase II. Funding would not be a problem. What is important to us is that our consultant will need to validate the value for money and the quality of work. We will not compromise the quality and timely completion of work,“ he said.
“There is no need for excuses. As for us, on our part, we are committed and we implore the contractors to do quality work and do it on time so that the road projects can be open for use to Nigerians,” he added.
The Executive Chairman of the Federal Inland Revenue Services (FIRS) Mohammed Nami, explained that most of the roads captured by Executive Order 7 to be executed by NNPC were mostly road projects inherited by the administration of Muhammadu Buhari.
“So, we are appealing to Nigerians to trust Executive order 007 so that government will continue to provide the physical infrastructure that our people need,“he said.