The Petroleum Equalisation Fund (PEF) policy of the federal government which started in 1976 has been described as one major cause of lack of economic growth, development, corruption, fraud and other malaise plaguing the Nigerian economy.
This was the submission made in Lagos at the presentation of a new book, titled: ‘Reversing the rot in Nigeria: A critical expose on the nation’s economic, religious and political cul-de-sac’ by Olusegun Oyegbami.
The author, Olusegun Oyegbami an oil and gas expert, who has worked in the downstream sector since January 1977, said, “PEF is designed to make the price of petrol the same all over Nigeria with its pricing template and the payment of this on all such transportation by PEF is really what is called subsidy, a payment which he said is unjustifiable from a socio-economic point of view.
“PEF policy is the incubus and vehicle for the continuous destruction of the Nigerian economy and consequently the Nigerian society. The policy which started in 1976 at the start of the regime of Olusegun Obasanjo signaled our descent to hell on earth and the misguided plunge is still very much ongoing.
“PEF is a systemic rot, Nigerian economy is petroleum based, so if you are running an economy that is based more on petroleum marketing and that so-called petroleum marketing is fraudulent then the whole leg that the economy is standing on is fraudulent.
“The scam that is PEF delibrately ignores the basic economic principle of recognising locational advantage which has destroyed productivity in the country especially in the North.
“It is fraud when you say you are equalising petroleum price…because it has no economic foundation; it only puts money that should have been used to develop the whole country in the pocket of few individuals and people won’t even know it,” Oyegbami said.
He noted that “The start-off point and continuing source of corruption in Nigeria is the PEF policy of equal price of petrol everywhere, and most of the other malfeasance in the oil industry derives from it,” Oyegbami said.
According to him any society that does not run on economic template will fail, it should be economy first, it is after the economy is strong that you can now develop strong political institutions.
The book, Oyegbami said contains commentary on the observed manipulations in the marketing of petroleum products in Nigeria, especially Kerosene.
“The skewed and fraudulent handling of this product in particular has snowballed into so many socio-economic maladies and destruction of lives, equipment and property such that it begs the question whether we are a sensible and human society at all,” he said.