ICAN advises FG on subsidy removal

The Institute of Chartered Accountants of Nigeria has listed conditions that must be fulfilled before the planned subsidy can be removed. It said that there was need for the government to disclose to Nigerians the identities of companies that benefitted from the subsidy regime. The decision was the high point of a two-day deliberation on crucial economic issues for sustainable development. ICAN in a communiqu issued after the meeting, however agreed that it was imperative for subsidy to be removed.Between January and now, the Federal Government has spent a whopping N1.4tn as subsidy as against N240bn approved in the 2011 budget. The draft communiqu reads, "The conference agreed in principle with the intention of government to remove the oil subsidy. However, the conference requires that the government makes the entire process transparent and fair with proper accountability by disclosing the nature and amount of this subsidy, disclosure of the identities of individuals and entities benefitting from these subsidies, articulating clearly the development initiatives to which this subsidy will be pushed. "In addition, there should be a process for disclosing and auditing the sources and uses of this subsidy flow. The conference also agreed in principle with the continued maintenance of the Sovereign Wealth Fund. However, the fund should be efficiently and transparently managed." Most members, who spoke at the forum, urged the government to address the problems raised in the draft communiqu. This, they noted, should also be used as transformation tools for improving the welfare of the people and enhancing the operational efficiency of the fiscal regime. For instance, a fellow of the Institute, and President of the Lagos Chamber of Commerce and Industry, Otunba Olufemi Deru, during the discussion of the draft document, said, "The fuel subsidy removal should be effected if all the issues surrounding the amount being deducted and how it is calculated are made known. As accountants, this is an area we need to look at seriously."
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