Abuja — Some state governments are preparing a legal action against the Federal Government for fuel subsidy deductions from the Federation Account which they claim are illegal and unconstitutional.

The past administration of President Olusegun Obasanjo had initiated the Petroleum Support Fund bill in 2006 to legitimise the deductions to fund the huge subsidy bill, but it is yet to be passed by the National Assembly.

Also, because of the deregulation programme of the government, the bill is not likely to be pursued any longer as government will no longer be involved in the pricing of petroleum products.

The 36 states of the federation, 774 local councils and the Federal Capital Territory contributed over N1.3 trillion to the subsidy fund between 2006 and last year, although only Lagos, Rivers and Abuja enjoyed the benefit of paying N65 per litre of petrol before the current fuel crisis crept in.

A breakdown of the state-by-state contributions shows that Akwa Ibom State is the highest contributor to the fund with N122.37 billion - although fuel is sold for between N85-N90 per litre in the state.

Rivers State comes next with a contribution of N112.80 billion but fuel is currently sold at about N100 per litre there.

Delta State, with N108 billion contribution to the fund, buys fuel in the range of N80-N100 per litre - compared to Lagos, a major consumer of petrol which contributed only N37 billion to the fund, the same as Katsina State.

"It is not only unfair the way states are forced to contribute to the subsidy fund in a very disproportionate way; it is all the more ridiculous that despite contributing so much to the fund, our people never get to pay the actual price for the product. This is double jeopardy. In any case, the contributions are illegal," a governor told THISDAY.

It is not yet clear when the case will be filed but THISDAY learnt that many states are arguing that the billions of naira spent on subsidy without much benefit to their citizens could be better spent on infrastructural development.

"Can you imagine what a state like Akwa Ibom or Rivers could have done with over N100 billion if it was not forcefully deducted for subsidy? A state like Ekiti has contributed N21 billion. Imagine what that can do if it is in their budget for education or roads or health," another governor told THISDAY.

Meanwhile, the National Association of Road Transport Owners (NARTO) has called on the Minister of Petroleum Resources, Dr. Rilwanu Lukman, to extend the riot act issued to the Nigerian National Petroleum Corporation (NNPC) on fuel scarcity to include efforts to tackle malpractices within the supply system.

Lukman had last week read the riot act to the NNPC management to end the fuel queues within seven days or face the sack.

The Coordinator of NARTO, Alhaji Lawan Isa, who was at the NNPC Towers in Abuja on solidarity visit to the special task force established by the NNPC Group Managing Director, Dr. Mohammed Sanusi Barkindo, to end the scarcity, said the association would want a similar action undertaken to deal with the endemic corruption and sharp practices holding down the sector.

A statement signed by the Corporation's Group General Manager, Public Affairs, Dr. Levi Ajuonuma, quoted the NARTO Coordinator as having commended the government measure to arrest the fuel supply crisis.

"In my paper at the Lagos forum I said we are all guilty, that is a confessional statement. Now that we are confessing, what follows is for us to stop committing these sins. We must all be prepared to do clean business. I am not blaming anybody because we are all guilty, but we must be ready to move this industry forward," Isa stated.

It is believed that a large percentage of fuel imports are lost to cross-border smuggling everyday through the tankers.