The National Economic Council (NEC) on Monday says the removal of fuel subsidy is inevitable.
The council chaired by the vice-president, has the 36 state governors and some cabinet ministers as members.
It is the highest economic decision making body in the federation.
Making the council’s position known to State House Correspondents after its meeting in Abuja presided over by Vice-President Namadi Sambo, Gov. Peter Obi of Anambra stated that the removal of the subsidy would enable the government to service its debt portfolio.
“It is a case of inevitability considering the level of present debt portfolio of the federal government, and the continuous financing of it.
“Like the president said either way there will be grave consequences but one is lesser if we take it.
“There is no place such decision has been taken that people do not feel a temporary pain.”
Gov. Obi said the council had agreed to set up a board to manage the funds which would accrue from the removal of subsidy on fuel.
Obi said the fund would be channelled towards funding public work programmes, unemployment and urban mass transport scheme.
Part of the fund, he added, would be used for the building high profile infrastructures such as roads and railways, water resources, power and construction of refineries and on health projects.
He said: “A board of reputable professionals from different sectors will be established for effective management of the freed funds for the benefit of the people.
“The board which will function independent of government control will ensure transparency and proper application of the funds.
“States will embark on necessary actions in areas of advocacy to sensitise Nigerians on the expected benefits from deregulation.”
He also said that states and local governments would be collaborating with the Federal Government, in line with the framework for the implementation of the programme.
Obi who briefed alongside Gov. Olusegun Mimiko of Ondo State and the Ministers of Power Barth Nnaji and that of National Planning, Shamsudeen Usman, said during the meeting, the National Security Adviser, briefed council on the security challenges in the country.
He said that the council also deliberated on the power sector reform, adding that critical partners and stakeholders in the ongoing power reform had been assigned roles in power distribution and generation.
He also said the National Electricity Regulatory Commission had been directed to issue operational licenses to states that intended to either generate or distribute power provided they met the required conditions.
“Federal Government’s policy is to encourage states to participate in the power reforms in order to enhance power supply in the country.”
The governor added that, “some categories of customers are to be subsidised. The idea is for those who can afford it, to pay the appropriate tariff, while the very low users will be subsidised.”
He announced that the council constituted a committee to be headed by Gov. Liyel Imoke of Cross River to study and advise the council on the power issue.
Other members of the committee are Gov. Olusegun Mimiko of Ondo State, Gov. Gabriel Suswam of Benue, Gov. Patrick Yakowa of Kaduna State and Gov. Kassim Shettima of Borno.