The chairman of Northern Governors Forum, Governor Mua'zu Babangida Aliyu, is canvassing that if fuel subsidy is restored after negotiations with labour, states should henceforth pay according to consumption levels.


This means Lagos, which consumes an estimated 60 per cent of petrol in Nigeria, would pay most of the N1.3 trillion subsidy, even though its share from deregulation savings is estimated at a mere N10 billion.


Aliyu, who was part of the negotiating team yesterday, was said to have argued that Northern governors were not in favour of the old subsidy payment regime which was usually deducted from the federation account before allocations were shared.

According to sources at the meeting, Aliyu said there were not many cars in Northern Nigeria and it would not be equitable for all the states to contribute to the subsidy fund equally when consumption is mainly in the South.

Aliyu's argument may re-ignite the debate about fiscal federalism, as Lagos State has also been canvassing that the Value-added Tax (VAT), most of which is generated by consumption in Lagos, should not be shared among all the states of the federation.

Folks what your views on this, sound interestings. Maybe those govs who were claiming to be against deregulation will now have the chance the continue with the subsidy. lol