Fuel Prices May Rise Again as Tinubu APC Government Moves to Enforce Long-Ignored Road User Charge

 

Petrol Prices Under Threat as FG Revives Dormant 5% Road User Levy to Fund Road Maintenance

Nigerians may soon face another increase in the pump prices of petrol and diesel as the Federal Government pushes forward with plans to enforce a 5% road user charge embedded in the price of petroleum products. The charge, which has existed under the FERMA Amendment Act of 2007, has long been neglected but now faces renewed interest due to the deteriorating condition of federal roads and chronic underfunding of maintenance efforts.

This move was revealed during an investigative hearing by the House of Representatives Ad-Hoc Committee held on Monday in Abuja. The hearing, covered by DailyPost, brought together key stakeholders, including the Ministry of Works, the Federal Roads Maintenance Agency (FERMA), and the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

Mohammed Goroyo, Minister of State for Works, made a compelling case for the activation and strict remittance of the charge. He painted a dire picture of Nigeria’s federal road network, emphasizing the widening financial gap in maintenance funding. According to him, the country requires a staggering N880 billion annually to maintain optimal road conditions across its vast network. However, recent budgetary allocations fall far short—N76.3 billion in 2023, N103.3 billion for 2024, and a proposed N168.9 billion for 2025.

“The consequences of these shortfalls are not theoretical—they manifest daily in the form of dilapidated roads, costly vehicle repairs for Nigerians, and severe disruptions to commerce and travel,” Goroyo explained. He stressed that the 5% user charge, already stipulated by law, offers a potentially sustainable funding mechanism if diligently implemented and properly remitted.

Despite being embedded in legislation for nearly two decades, the charge has never been systematically enforced. This revelation was highlighted by the Managing Director of FERMA, Chukwuemeka Abbasi, who attributed the agency’s persistent struggles to inadequate funding. He noted that despite having a statutory provision for sustainable financing, FERMA has had to grapple with meager allocations and insufficient infrastructure investment.

Abbasi stated, “The five percent user charge, as enshrined in the FERMA Act, was created to ensure a reliable funding stream for road rehabilitation and maintenance. Yet for years, the agency has been left to operate in financial uncertainty, largely due to the failure of regulatory authorities to implement and deduct this levy as required.”

As part of the parliamentary response, the Speaker of the House, Tajudeen Abbas, emphasized the importance of adhering to existing laws. He reminded the public that the House had, on March 19, adopted a motion highlighting the non-implementation of the levy and promised legislative backing to enforce compliance.

Chairman of the Ad-Hoc Committee and House Committee on Rules and Business, Francis Waive, sought to calm fears of an imminent fuel price hike. He reiterated that the road user charge is not a new tax or a legislative amendment, but a legal obligation that has simply gone unimplemented. According to him, the objective of the hearing was to correct years of disobedience to established legal frameworks.

“This is not about burdening Nigerians with new taxes,” Waive stated. “It’s about ensuring agencies obey the law, and that the laws passed by the National Assembly are not treated as optional.”

Public attention to fuel prices has intensified recently following a modest drop in pump rates. Outlets operated by the Nigerian National Petroleum Company Limited (NNPC), Dangote Refinery, and its downstream partners recently reduced the price of Premium Motor Spirit (PMS) to between N875 and N895 per litre in Lagos and Abuja, offering temporary relief to consumers. However, that relief now appears short-lived as the implementation of the road user charge could reverse the price trend.

The announcement has sparked debate, particularly at a time when Nigerians are already grappling with high living costs and inflation. While some experts argue the move is essential for long-term infrastructure development, critics question the timing and potential economic impact on ordinary citizens.

What remains clear is that the Federal Government is under pressure to find sustainable solutions for maintaining its extensive but crumbling road network. Whether the reactivation of this long-ignored levy will deliver those results—or merely trigger another fuel price hike without corresponding infrastructural improvement—remains to be seen.

As stakeholders deliberate the best path forward, the real cost may once again fall on the shoulders of Nigerian consumers.