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Tag: Fuel subsidy

  • Fuel subsidy: FCT minister distributes palliatives to Abuja residents

    Fuel subsidy: FCT minister distributes palliatives to Abuja residents

    From Gbenga Omokhunu, Abuja

    The Federal Capital Territory Administration (FCTA), yesterday commenced the distribution of assorted food items to vulnerable residents of the territory.

    FCTA said the development is aimed at easing the hardship occasioned by the removal of fuel subsidy.

    FCT Minister of State, Dr. Mariya Mahmoud, who performed the distributions of over 17,222 bags of rice, 8,400 bags of maize, assured that every deserving family in the six area councils and 17 chiefdoms of FCT will receive the free items.

    Mahmoud also assured that apart from the food items which would be released in stages, government is actively exploring other avenues to mitigate the impact of the fuel subsidy removal.

    She said: “There is no doubt that the policy has had a ripple effect on transportation, inflation and an overall burden on the citizenry.

    “It is in realization of these challenges that the Federal Government has been taking several measures to bring succour to Nigerians amongst which is the release of assorted food items from the National Strategic Reserve for urgent distribution to Nigerians. We will ensure that every deserving family in the FCT receive these items free of charge.”

    Read Also: Fuel subsidy: Otti rolls out measures to ameliorate effects on workers

    While calling on FCT residents to exercise prudence in their daily lives, she noted that the present administration under the dynamic leadership of President Bola Ahmed Tinubu, was committed to implementing measures that would stabilize prices, encourage economic growth, and promote prosperity and well-being for citizens.

    The minister, however, charged beneficiaries to use the food items wisely and endeavour to share with those who are most in need, stressing that Mr. President is striving to reposition the Nigerian economy and win the war against hunger and the attainment of self-sufficiency in food production.

    On his part, the FCTA Permanent Secretary, Mr. Olusade Adesola, noted that the administration, through relevant arms, has put in place measures to monitor the distribution of these essential food items to ensure that they got to the targeted beneficiaries in all the area councils.

    The Permanent Secretary who was represented by the Director Operations, Planning and Strategy, Mr. Samuel Attang, also noted that the distribution was part of series of efforts being put in place by government to address the economic challenges and create an environment of stability and prosperity for all.

  • ‘Fuel subsidy removal in public interest’

    ‘Fuel subsidy removal in public interest’

    The removal of fuel subsidy has been hotly debated with mixed reactions from different quarters. One person who should know better is the National Trustee of National Union of Petroleum and Natural Gas Workers (NUPENG), Dr Salimon Akanni Oladiti (SAO) l. In this interview with Yinka Adeniran he attempts a prognosis of the chain of events that led to its removal vis-a-vis other contentious issues affecting the nation’s petroleum subsector. Excerpts:        

    How is the state of our depots across the country affecting the oil and gas sector?

    Well, concerning the downstream, Nigeria as a nation, we will continue to pray to God to change the thinking and behavior of Nigerians and our leaders generally. Why I am saying this is that, in Nigeria, government investment is just like a community goat. A community goat that may be feeling hungry and you wonder why because those that should have fed him would have assumed that it has eaten from different places at every time of the day, that best described Nigerian government investments.

    In the olden days, we had Nigerian Airways, Nigeria National Shipping Line and many others, where are all these investments today? They have all vanished. And it’s a pity that we are wasting our national asset.

    About the NNPC depot we talked about, if you search Google, you will see the oldest refinery in the world is in California, about 84 or 87 years old. Nigeria refineries are just over 30years and they last worked about 10-15 years ago because they are all like the proverbial community goats.

    We ask Nigerians, the pipeline vandals, who are they? They are Nigerians too. We just continue to kill our future with such acts of sabotage. That is the basic truth. Yes, we condemned this government and that government, government is there to lead the nation, but what is the thinking, behavioral attitude of we the nationals? What is our thinking and relationship with government investments?

    Some years back when I was the unit chairman at the NNPC Depot, Ibadan, the late former Governor Abiola Ajimobi of blessed memory, we approached him then and we had synergy with the military, I can still remember one General Muazu, the GOC of 2 Division of Mechanised Army at Odogbo, Ojoo, we took our matter to him and told him about the vandalism of pipelines along Ibadan- Mosinmi Arepo axis. They tried their best, we used our money to fund the mission. Every Saturday, we will have to go and meet all the troops inside the bush.

    I am a tanker driver by profession but many people may not know that. And I have been driving a tanker since 1976. We know the in and out of the downstream. Until a government came and summoned the courage to privatise all these investments, we were just wasting our time. By the grace of God, today I am a transporter, and you can notice that within my premises. There is no stubborn truck that I will not get rid of. Whatever it will take, it’s my investment and I know that time is money. I will make sure that I do whatever is required to fix any issue but bureaucracy in will not allow that in government investments and you that you are telling them the naked truth will be tagged as an enemy.

    Years back, when we noticed the increasing spate of tanker accidents, tanker fires around the country, we had to hire an expert and consultant. When they did their job, they discovered that 75 percent of tanker accidents happen overnight, and they advised us to make sure that by 7PM, at worst, we should tell all our members across the country to park their trucks until the following morning before continuing their journey to any part of the country. We implemented it and it worked well.

    We discovered that anytime there is a tanker accident, the tanker will burst and a huge fire will start. We discovered that there is a device called safety valve underneath and on top of tankers, which is the best practice all over the world. In fact, we had among the International Oil Companies (IOC) in Nigeria, I’m talking about Total, they are the most safety standard compliance company that is incomparable in the country and we adopted it, because we discovered that if a tanker falls, a single litre of oil will not drop.

    In some parts of the country, they don’t care about the safety of the driver and motorboy and the equipment itself. You will see them scooping oil from a fallen tanker. We introduced the use of the valve to the system and we set a deadline for all trucks without the safety valve not to operate on our roads and our depots across the country.

    But, some people went to Aso Rock to blackmail me that I am the importer of the safety valve and I want to force it on everyone. I was invited, I defended myself and the government of the day agreed with me.

    To enforce the date, they told the government that it will create fuel scarcity and that was why the government at the time abandoned the idea.

    Let me come back to the roads. Then, as part of our findings, we advised the government not to allow any capacity beyond 45,000 litres. We are crying on a daily basis that the Nigerian roads are bad, but we are creating problems within problems for ourselves. We have some trucks that carry 70,000 to 90,000; 100,000 litres capacity on our roads. If those trucks are passing on the road, if you stand by the roadside, you will feel the vibration.

    Let me tell you this, if President Bola Tinubu reconstructed all Nigerian roads and didn’t put a regulator to regulate and implement what we are talking about, we are still going back to square one. The government will continue to do what we call a budget for road infrastructure all round the year.

    In my recent visit to the US, I didn’t see any tanker carrying even 45,000 litres. Their maximum capacity for the road is 30,000. When we, alongside my peers, were operating in the 70s, the highest capacity was 27,600 tankers that you will see on the road. So, it is unfortunate that we find ourselves in this mess. That is why the expectations of most Nigerians are very high with President Tinubu.

    I am a very strong supporter of President Tinubu and I won’t hide it. Unlike someone “Mr go-and-verify”. This is what we need. We need radical change. People have been talking about deregulation. Deregulation at this time is very painful but there’s no alternative to it.

    Myself and some friends were in a discussion earlier, they are investors in the downstream. Presently, compared to Nigeria Naira and Ghanaian Cedis, the price of a litre is almost N1,200 per litre. In Togo its equivalent of N1,100; it’s even more in Benin Republic, Burkina Faso and others.

    Yes, the government puts the deregulation in place, just to cushion the problems of Nigerians, but we misused and abused it. We have some areas that on a daily basis, we have 45,000 tanker capacity in their hundreds that Nigerians are smuggling regularly. If you multiply that one it will amount to millions of litres of oil that have been smuggled. Yet, this is the product that the government has already subsidised with a heavy amount of money on a daily basis.

    They set up various interventions and called different operations, it amounted to zero because it’s now like corruption is part of our system that involves almost everyone and anybody. It’s like they have even put it in our constitution, with the way we behave. Nobody seems to care.

    We have heard of cases of repeated repairs of the refineries and turnaround without tangible results. Can it ever work?

    It can work. But, until it is in private hands. For the government to say, it wants to manage it, we are only deceiving ourselves. Take note, for the government to manage refineries, just like I said earlier about government investments which I liken to a community goat, somebody that is an MD will go to his village. Someone who doesn’t even know anything about engineering or whatever will be put there. Unqualified people will be put in charge and we expect to get the correct answer, we are only deceiving ourselves. But, if these investments, our refineries are in private hands, we can then be talking about getting results. Overseas, there is nothing that concerns the government with electricity, roads, water because the private sector is in charge. What the private hands managing those sectors will only do to the government is to be paying royalties and taxes.

    Read Also: My ambition now is supporting Tinubu to succeed – Yahaya Bello

    The notion that the government sells to their cronies all in the name of privatisation has not made people have trust in the government going that route. The power sector is a case in mind?

    When Tinubu brought Enron to Lagos at the time, what happened? The then Federal Government knew that what Tinubu brought was genuine and Obasanjo, due to his personal hatred for Tinubu, disallowed the idea.

    When Late Lateef Jakande tried to introduce the Municipal Metro line, the Federal Government led by Buhari then disallowed it at the time when he took over power from the civilian government. You can imagine all that. But because the Lagos State government has their own master plan and they had it in mind to do what is right, they are putting it in place now, but it’s too late. It is very costly now.

    What do you say about the timing of the fuel subsidy removal?

    One thing I will let you know is this, if they didn’t remove it at the time they did, only God knows where we would have found ourselves today. When 95 percent of Nigeria’s earnings have been used to offset debts. To pay the salary, they go and borrow and we are part of OPEC.

    Before Tinubu came, everybody was ready to take the laws into their own hands. That is why, many areas that the Nigerian government can get money from are not explored. Nigeria is endowed with natural resources. You know the deposits of lithium we have. Can you compare the value with that of crude oil? Yet, some people have been mining it without anyone knowing or seeing them. There is gold all over the place and the activities of illegal miners are on the rise.

    To make things worse, many of our political leaders including governors, council chairmen, etc are not ready to invest by exploring other avenues for revenue. They only wait for the Abuja largesse, in the name of allocation and they share.

    As a citizen in the private sector who belongs to the downstream, I know what these fleets of my trucks today can do for me. I started with a six wheeler truck, but I was determined to become something in life even when my parents cannot train me to be a Professor. I was determined to do whatever I can do for myself to make headway in life. Look at our youths of today, they don’t want to work. If you give most of them jobs, they don’t want to do it. They prefer commercial motorcycles or even internet fraud for survival to make quick money. A golden ring will pass through fire before shining, and that is life.

    To what extent has the subsidy removal affected the independent oil marketers?

    It is only a few Nigerians that got things right with what they did with their money when they were making so much money. These are my Independent Marketers Branch (IMB) people that we will always continue to lecture when they are making money. When they are getting more, you will see many of them going to buy cars that they can’t maintain.

    It is not just now that most of us (IMB) realised that we have already made mistakes. But, to correct the mistake now, it’s late. That is the basic truth.

    Concerning fuel subsidy, if the government didn’t deregulate, we will just continue to go and queue at filling stations. I am buying the product at a very high price now because those who have it will go and hoard it and the government won’t have money to import. It is a pity for Nigeria. I read somewhere that in the 60s/70s, Nigeria dashed the United Arab Emirates money. We were in the same category in the 60s/70s. Even Nigeria was better than China in the 60s/70s.

    Once someone misses it somewhere in life, it may be hard to catch up again. That is our problem. All we are doing now is damage control. The damage has been done, we are only trying to manage things.

    Is there any hope for Nigeria?

    There is hope. The hope is that, if we can endure these pains, we know there is pain everywhere, we just have to endure it for a while. Let me give you an instance, before now, to buy a full load of 45,000 litres of petrol was just between N6.5 to N7million or around that rate. But now, it is about N26million and the profit margin is not more than N500, 000. When we were buying between N6.5 to N7million, you make an average of N1million to N1.2million. Oil business is highly capital intensive.

    What’s your advice to the independent marketers?

    As I sit to speak here today, I am a farmer. I have a large expanse of land which I am cultivating. The little money I have, I had to invest it in agriculture. That Is part of what is killing us. We export our crude oil and use it to buy refined products. We export our crude oil and use it to buy and import toothpicks from China. They are now even importing cooked food into the country from China. It’s like a curse on us. And part of our life that ruined many Nigerians is to try to live above their means. Many people are only copying the standard of life of other people, just because someone is doing something, they often feel they must do the same thing too.

    We always see that the whites make it, but we often forget that they don’t indulge in many things that we really do.

    I am the type of person that says the honest truth to people and that is why I can’t be a politician. I can’t because I don’t know how to call white black and I am always bold to speak my mind and the truth anywhere I find myself. What we are going through today is as a result of our undoing. We got many things wrong a long time ago.

    Many politicians have not helped matters. I don’t play politics with the truth. I may not be interested in politics but if we see people who have good intentions and getting it right, we have to rally round to support them. I am a strong supporter of President Bola Tinubu because I believe in his capacity to turn things around for the country.

    What words of advice would you say to President Bola Tinubu?

    It’s too early. I can’t blame Tinubu for anything. When he was flagging off his campaign, I was there and donated souvenirs with billboards across different parts of the country because of his antecedence when he was the governor of Lagos State. We have people like that that we can support and contribute our quota to his success but for me to dabble into politics, no I won’t.

    Well, all I have to say is that, only those who are looking for cheap popularity will be throwing needless banters here and there. We keep talking about prayers but I think we also have a whole lot to do as Nigerians to ensure we are better. How many churches do we have in Nigeria today? How many churches do they have in China? How many are in India? The country with the largest population now is India. India has 70million Muslims. They have four million Christians. The larger population practices their traditional religion. What about China? That is what we are using to deceive and kill ourselves. We keep looking for miracles when we are supposed to get to work and change our ways of life. Many people are looking for miracles all over, and you see them falling victims. I am a Christian, I believe in prayers but, it must reflect in your ways of life and actions. If you say you are praying and you are not using your energy to do the right thing it will amount to waste of time and resources. Energy without sense is foolishness. So, we have to be hardworking. We have to change our way of thinking and know how to channel our energy rightly as a nation. We have to change our negative thinking and mindset about Nigeria, if the nation must move forward because when you keep calling your country a negative name, give it a bad image in the outside world and you expect it to make headway, it doesn’t work like that.

    Are there no people who still call Nigeria a zoo? Yet, they don’t have another country they can call their own. For how long do we have to endure these? We all have roles to play to make Nigeria work and make it a better place for ourselves. This is not just about the government, neither the President or even the governors. We must stop all acts of sabotage to take us backward and ruin all forms of gain that we could call ours. Some of these acts slow the country down on its wheels of progress and all Nigerians must be deliberate and determined to say they will not be part of all forms of economic and infrastructural sabotage. May God help our country.

  • Protest against fuel subsidy removal in 2012 was mere politics, says Fayemi

    Protest against fuel subsidy removal in 2012 was mere politics, says Fayemi

    The immediate past governor of Ekiti State, Kayode Fayemi, has said that the protest against fuel subsidy removal during former president Goodluck Jonathan’s administration in 2012 was mere politics.

    Recall that on January 1, 2012, then President Goodluck Jonathan announced the removal of fuel subsidy by adjusting the pump price of petrol from N65 per litre to N141 in a move that sparked mass protests, known as ‘Occupy Nigeria’ across major cities of the country.

    Fayemi stated this in Abuja on Tuesday, September 5, while presenting his keynote address at a national dialogue organised to celebrate the 60th birthday of the founding national secretary of Alliance for Democracy (AD), and a fellow of the Abuja School of Social and Political Thought, Prof Udenta Udenta.

    The ex-governor said the challenges facing the nation today cannot be solved unless the country embraces proportional representation where the spoils of elections are shared between contestants.

    While noting that adversary politics bring division and enmity, he said Nigerians must look at proportional representation so that the party that is said to have one 21 per cent of the vote will have 21 per cent of the government.

    Read Also: Fuel subsidy: A’Ibom to create jobs through projects in LGAs

    He said: “Today, I read former president Olusegun Obasanjo’s interview in The Cable saying our liberal democracy is not working and we need to revisit it. And I agree with him, we must move from a political alternative, I think we are almost at a dead end.

    “What we need is alternative politics and my own notion of alternative politics is that you can’t have 35 per cent of the vote and take 100 per cent. It won’t work. We must look at proportional representation so that the party that is said to have 21 per cent of the vote will have 21 per cent of the government. Adversary politics bring division and enmity.

    “All political parties in the country agreed and they even put in their manifesto that the subsidy must be removed. We all said the subsidy must be removed. But we in the Action Congress of Nigeria (ACN) at the time in 2012, we know the truth sir but it is all politics. That is why we must ensure that everybody is a crucial stakeholder by stopping all these.

    The event was attended by former President Goodluck Jonathan, former minister of education in Nigeria, Oby Ezekwesili, and former minister of aviation, Osita Chidoka, among others.

    Details soon….

  • Fuel subsidy: A’Ibom to create jobs through projects in LGAs

    Fuel subsidy: A’Ibom to create jobs through projects in LGAs

    The Akwa Ibom state government said it is creating jobs in all the 31 local government areas of the state as part of its palliatives to indigenes and residents affected by the removal of fuel subsidy.

    Governor Umo Eno said the jobs would be created through the “One Project per Local Government Initiative” which is also aimed at reinvigorating the economy and increasing cash flow within the rural communities.

    The governor made the disclosure when he received the report of the palliatives committee set up by the government to work out modalities to cushion the effects of fuel subsidy removal.

    He stated that the projects would be awarded to indigenous contractors from the respective local government areas who in turn, are to recruit the locals to work and enhance their productivity as well as boost their purchasing powers.

    Governor Eno said: “What we are thinking of doing beyond this is to formally launch a one Local Government /One Project Initiative across the 31 local Government Areas.

    “In the next one month, we want to ensure that we have one project in each local government area of our State. We want to ensure that our young people get to work in the local governments.

    “We have a whole lot of projects to choose from, whether it is hospital or model school, water or any of the projects that we have listed in the A.R.I.S.E. Agenda to support rural development.

    “We expect Chairmen of each Local Government and critical Stakeholders in those local Governments to work with us in the Exco and be able to identify the project within the framework of what we are doing now to be able to ensure that we deliver projects to the local governments by appointing contractors within that local government that will also engage people within the local Government.

    “I think that is one of the creative palliatives that Government can provide by creating jobs and putting money in the pockets of the people.”

    Eno further stated: “We have to sit down and review this in line with the present economic realities and what accrues to the State. That notwithstanding, we assure you of our willingness to do much more than you have recommended and continue to help our people in the short, medium and long term basis.

    “What we have received so far from the federal government is two billion naira and 3000 (units) 50kg bags of rice. We believe that the other ones will come. If the federal Government is donating five billion, the committee has recommended another five billion, so what we have here is ten billion as the estimates for the palliatives.”

    The governor emphasized that the palliatives should be given to the poorest of the poor across party lines and to residents of the State especially those residing in the rural communities.

    He added: “I listened to you in terms of distribution of the palliatives and I love the modalities you have adopted. Please this must be across party lines. It is for Akwa Ibomites and residents of Akwa Ibom. All the people living here, whether they are indigenes or non-indigenes so long as they reside in Akwa Ibom.

    “I am happy that you have clearly mentioned that as part of your report. Please, this is not a PDP or an APC thing. It is an Akwa Ibom thing and we should ensure that we drive this down as we go to the villages to distribute the palliatives.”

    Governor Eno also referenced road grading, transportation and agriculture as critical areas to be addressed in the provision of palliatives to the people.

    Read Also: Fuel subsidy removal: Transport firm slashes fares by 25%

    Earlier in his presentation, the Secretary to the State Government and chairman of the Palliatives Committee, Prince Enobong Uwah, thanked the governor for his decision to set up a committee to work out modalities that would cushion the effects of fuel subsidy removal on the people and ensure even distribution of the palliatives to the needy in the state, saying the gesture is commendable.

    Other recommendations include a-three month financial support to civil servants, approval of four working days to civil servants, reduction in cost of daily tickets to transport operators, reduction in price of daily tickets for market women, payment of bursary to students, provision of free drugs for pregnant women, children and the aged.

    Others are provision of buses to convey workers to and from work, opening up of economic access roads in rural areas, entrepreneurial support for business operators, intervention in primary healthcare delivery systems, provision of micro health insurance scheme for civil servants, establishment of fuel depot in the State, among others.

  • Sunmonu to Buhari: don’t succumb to IMF pressure on fuel subsidy

    The founding President of the Nigeria Labour Congress (NLC), Alhaji Hassan Sunmonu, has advised President Muhammadu Buhari not to adhere to the recent call by the International Monetary (IMF) to remove subsidy on petrol if he does not want to lose the support of the people.

    Sunmonu spoke yesterday in Lagos during the public presentation of the Minority Report & Draft Constitution of the 1976 Constitution Drafting Committee, a document authored by Dr. Olusegun Osoba (not the politician) and the late Yusufu Bala Usman.

    The trade unionist, who chaired the event,  said Nigeria should not go back to the 1980s when the country became a debtor nation and the IMF influenced the cut in subsidy on education, health, transportation, as well as the stopping of the rail system that was being built then.

    He said: “Now, the Buhari administration is bringing back the railways – not even the narrow gauge, but the standard that you can have trains that can run at 200 kilometres per hour or more. This is what the IMF influenced our government under Babangida to stop. After it destroyed our education, it now came up with what it called IMF support for education.

    “So, we want President Buhari to be very, very careful of the neo-liberalists that surround him and who are intent on taking Nigeria back to those dark days; Nigerians would no longer accept such. I also like to advise that this book which has been launched today should be the basis for a new constitution that we hope will be done within the next to one year, to supplant the one that is currently taking Nigeria backwards.”

    Speaker after speaker at the event emphasized the fact that the problems bedevilling the country today would have been nipped in the bud if the authorities then had accepted the report and made it part of the constitution.

    The co-author of the book, Dr Osoba, 83, said restructuring is a recurring lie in the lexicon of the ruling class because it is presented as a one-stop solution that can solve all the economic and social ills in the country. He said restructuring as being presented by its proponents is all about creating more states and introduction of resource control, to give more opportunities and access to the ruling class to continue to loot the treasury.

    Osoba said: “They’re only talking about sharing power and wealth horizontally, among states, ethnicity and religion; not vertically from top to bottom and that’s the most important form of restructuring. The continuous struggle is the only solution to our problem; not restructuring.

    Read also: Is fuel subsidy ideologically inevitable?

    “We stand to present this book, which we hope will correct the problems facing the nation – through a democratic constitution.”

    He said change cannot come easily to Nigerians and that they have to struggle for it because the people at the helm of affairs would not allow it because the status quo favours them. He said change can only be brought about by overthrowing the existing order. He said all the developed nations of the world had, at one point or the other, overthrew the old order to make progress.

    Attahiru Bala Usman, son of the co-author, the late Yusufu Bala Usman, also said the “Minority Report” would add value because there were many things that were thrown out by the soldiers that foisted the current flawed constitution on Nigerians. He said the report is now published with a new introduction to bring it to the knowledge of the public and to make it available to members of the National Assembly; so that Nigerians can talk about it.

    Usman said: “We are going to give this to all members of the National Assembly, civil society groups. The same way people struggled for Nigeria’s independence, the same way people struggled to abolish slavery, the same way other people are going to struggle to improve this democracy.”

    Centre for Democratic Development Research and Training Director Dr Abubakar Siddique Mohammed said the book could not be launched 42 years ago, because they were attacked by the police when they attempted to do so.

    He said: “At that time, the government did not want the public to know what was in the document, they didn’t want it. So, a majority of the members of the Constituent Assembly also didn’t want it released. But we decided that given the magnitude, the weight of the document and what the document was trying to deal with, the Nigerian public should know so that there will be public debate as to what should be the content of our constitution. So, we shouldn’t allow the government to bury it. So we organised the rally.

    “Since then so many things have happened in Nigeria. We decided to revisit this report because of major developments in this country in which the report actually raised 42 years ago. For example, 42 years ago, they said anybody who has attained the age of 30 can contest elections in Nigeria. The issue of social justice – the right to education, the right to health, security and so on and so forth – they (the report) mentioned that it should be made justiciable, but they were ignored. If you look at certain sections of the 1999 Constitution, they are there, but all these things are not justiciable. You can’t take your governor to court because he has denied you education, he stole the money and did not build schools; you can’t take anybody to court because he failed to build hospitals or hospitals have been built but he has failed to equip them; you can’t take anybody to court because he has failed to protect your life. Yet, we vote money every year for security.

    “Look at what is happening all over the country; the things these people (the two authors) talked about, wrote about and warned us about 42 years ago, we are now facing. Take the issue of citizenship. The simple definition of citizenship; we have a simple definition of citizenship (in the report). Now we have two: citizenship of Nigeria and citizenship of a particular state and this clash has led to a series of conflicts in this country.”

    The director said thousands of people have died because of this indigene/settler issue. He added: “They (the authors) predicted that there would be problems if it wasn’t solved 42 years ago. We are now facing the problem. Even those who rejected the report at that time are now talking about them.”

    Book reviewer Femi Falana explained what led to the writing of the “Minority Report”. He said the report came up because the two members of the Constitution Drafting Committee disagreed with the report authored by the remaining 47 members, led by the late Rotimi Williams (SAN).

    Falana said if Osoba’s and Usman’s input had been accommodated, it would have helped to solve some of the problems currently facing the country.

     

  • Is fuel subsidy ideologically inevitable?

    Ade Alabi was sick in a village near Ibadan during the recent fuel scarcity. His neighbor had a car and was willing to take Ade to the nearest primary health centre. But the raging fuel scarcity at the time prevented his neighbor from having petrol to buy, even though he was ready to pay the prohibitive price of N200 per litre charged by Black Market sellers of petrol in the village. All efforts to take Ade to the hospital on his own Okada proved futile. There was no rubber hose to transfer petrol from Ade’s Okada into the car of his neighbor. Even though Ade had a brother who could ride Okada, his brother was just as big as Ade. It was not possible to have both brothers on the Okada with a third person to prop Ade up on the way to the clinic. While the entire village was thinking about how to get Ade to the hospital, the poor man slumped and died, leaving behind a wife and three children.

    The story above illustrates the danger (to the poor in particular) inherent in the insistence by self-defined socialist ideologues (in and outside the trade unions) on the religiosity of retaining fuel subsidy as the best way to protect the poor and workers from exploitation by money grubbing oil and gas merchants and from neglect from a government in charge of a country whose most effective source of revenue in petroleum.

    Many cases are being made in traditional and social media in support of cancelation of fuel subsidy in the country. Some pundits base their position on evidence of corruption in the handling of the subsidy scheme, citing examples of irregularities in various committees established to probe the country’s subsidy scheme. Examples of financial irregularity are drawn from Farouk Lawan Committee’s Probe in 2012. This report claims that N232 billion on subsidy was paid to marketers for PMS in 2011 for fuel that was not supplied. The same committee also established that, contrary to the claims of marketers that 60 million litres was imported for each day in 2011, only 31 million litres per day was accounted for.

    Some commentators focus on the Nuhu Ribadu Probe in 2012 to argue for cessation of subsidy on the ground of lack of transparency. They draw attention to the report that NNPC deducted subsidy-related expenses before payment to the Federation Account in 2011. This group argues that NEITI’s audits from 1999 to 2011 also confirmed that NNPC deducted a total of N1.40 trillion for subsidy. Similarly, the Presidential Committee on Verification and Reconciliation of Fuel Subsidy (2012) is cited by anti-subsidy commentators to illustrate that 197 subsidy transactions worth N229 billion were illegitimate and that actual expenditure on subsidy was higher in the same year than appropriated sums for fuel subsidy.

    Economic thinkers of the free market persuasion also argue that natural resources are finite and attract largely time-limited revenues, more so if such resources are sold in the international market where the exporting country has no control over pricing. This group posits that it is not rational for any government to prefer fuel subsidy for citizens across the social spectrum to promoting sustained inclusive economic development through investments that can have multiplier effects on sustainable empowerment schemes for the underprivileged. This group calls for an end to fuel subsidy which its spokespersons believe to be a non-sustainable way of allocating natural resource revenues.

    On the other hand, trade union leaders and self-defined advocates of the poor argue passionately in favour of continuing with fuel subsidy. The trade union’s claim includes the need to view fuel subsidy as a non-negotiable poverty-alleviating policy. This school of thought calls on government to accept the need to make every Nigerian enjoy the fruits of a natural resource that under a unitary system of government is viewed to belong to the entire country, regardless of the damage the exploitation of such natural resource does to the economy and ecology of the communities in which such resources are located.

    Another line of thinking within this group is that underpaid workers, poor, and unemployed citizens need fuel subsidy to mitigate the knock-on effect of their poverty. The same group also argues that it is unfair for the federal government to stop fuel subsidy until the government is able to create the type of transportation infrastructure that exists in more developed countries, where fuel subsidy is discouraged as a policy. They add that the government must repair existing refineries and construct more to bring the price of refined petrol for domestic consumption down to the point of making fuel subsidy unnecessary. The Jonathan government accepted the thinking of labour leaders by creating another bureaucracy, Sure-P, to pacify workers and labour leaders, after agreeing to peg the price of petrol at N97 per litre. Just like the subsidy scheme itself, it did not take a long time for Sure-P to become another trick to occlude financial mismanagement by the country’s venal political elite.

    The position of trade union leaders and believers in social democracy appears unassailable. In a country where there are not many social assistance programmes for citizens at the bottom of the economic ladder, there should be nothing wrong with calls for special assistance to the unemployed and underpaid workers. In terms of fine ideological thinking, trade union leaders and their social democratic supporters are making respectable arguments. But the hard question that needs to be asked and answered by radical social and economic thinkers is whether fuel subsidy is the best way to assist the poor in our country.

    Despite the social democratic credentials of this author for over half a century, I do not believe that there are no better ways to assist the poor than the current fuel subsidy that is as enmeshed in the culture of political and bureaucratic corruption as it can ever be in any human space. In a country in which political parties do not openly embrace any noticeable form of social democracy, as in countries such as Canada, Denmark, Finland, Ireland, Netherlands, New Zealand, Sweden and Norway, where social democracy is a fact of life, there are hundreds of ways to assist the poor without having to attempt to pay some of the cost of fuel for them. In these social democratic systems, the line between the middle-class or middle-income and low-income groups is made clear when policies of social assistance are being crafted. It is not so in the case of Nigeria’s fuel subsidy scheme, which allows upper-middle class professionals to enjoy fuel subsidy that should have been reserved for the underprivileged.

    The argument that fuel subsidy in Nigeria is to protect the poor is spurious. Out of the 145 vehicles per 1,000 citizens in Nigeria, 85 of them are cars belonging to middle-class members of the society. It is not an exaggeration to say that it is the car-owning middle-class citizens that benefit largely from fuel subsidy. If indeed fuel subsidy assists the low-income and the unemployed, it is not to the extent that it benefits the middle-class. Definitely, there ought to be better ways to assist the poor.

    For example, the federal government can use the money spent on fuel subsidy to pay for such services as free education, free meals for school children, free health for the poor, social welfare checks for the poor, and free adult education for the poor. In addition, poor citizens can be given social welfare support that they can use to pay for market price of petrol. Furthermore, trade unions can insist that the existing refineries be sold to workers for one naira each so that workers’ cooperatives can manage the refineries. The federal government can put the matter of removal of subsidy to a referendum to determine what majority of citizens want, as opposed to what paid representatives of labour prefer. Without doubt, if Ade Alabi, referred to at the beginning of this piece and his relations had been given a chance to vote Yes or No in a referendum on removal of fuel subsidy, all of them would have voted Yes, in hopes that the Ade Alabis of Nigeria can be taken to the hospital before it is too late.

    President Buhari and his team should pluck the courage to address this albatross around the neck of the nation. In addition to initiating many direct social assistance programmes for the poor, the federal government should use funds currently being used to pay subsidy charges to assist the poor in ways that those assisted can use the social assistance funds to solve the problems most important to them.

    • This article was first published in 2016

     

  • NUPENG, PENGASSAN to FG: shun counsel on removal of fuel subsidy

    Workers in the oil and gas sector on Sunday advised President Muhammadu Buhari to shun any counsel that would destabilise or cause chaos in the economy.

    The Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) and the Petroleum and Natural Gas Senior Staff Association (PENGASSAN) gave the advice in a statement in Lagos.

    The statement was signed by Mr Okugbawa Lumumba, PENGASSAN General Secretary and Afolabi Olawale, NUPENG’s General Secretary.

    The Managing Director, International Monetary Fund, Christine Lagarde had on April  12 called on the Federal Government to remove fuel subsidy because of low revenue mobilisation that existed  in terms of tax to Gross Domestic Product.

    They said that the IMF advice on how to recover Nigerian economy was worrisome as it had become counter productive.

    “Any economic policy that is devoid of human feelings can lead to more social dislocations and upheavals, which will later become counterproductive as currently experienced,’’ it said.

    The unions said that IMF had created panic in the country with associated hoarding of petroleum products, panic buying, skyrocketed increases in prices of goods and services in the country.

    Read also: Fuel: NUPENG, IPMAN say no reason for panic-buying

    It said that earlier, the IMF chief praised the significant progress the nation had made in terms of its Gross Domestic Product (GDP) that increased by 1.9 per cent in 2018 from 0.8 per cent in 2017.

    It said that the IMF was not considering the pains and agonies the people went through to achieve the  gains of 2018, with almost two-thirds of the world’s hungriest people among Nigerians.

    The unions also cautioned that imposing more stringent reforms in domestic revenue mobilisation including increase in VAT and securing more domestic oil revenues through subsidy removal was an attempt to destabilise the nation.

    The unions in the statement appealed to President Buhari to put in mind the current hardship the people were going through in their collective journey to economic recovery. (NAN)

  • Breaking: No plans to remove fuel subsidy – FG

    The federal government has declared it has no plans to remove fuel subsidy.

    Finance Minister Mrs. Zainab Ahmed disclosed this on Sunday at a joint press briefing with the Central Bank of Nigeria (CBN) Governor Godwin Emefiele at the end of the 2019 World Bank/International Monetary Fund (IMF) Spring Meetings in United States.

    She said: “We are here to discuss with the global community on various policy issues. One of the issues that always come up, especially in the IMF Article IV is how we handle fuel subsidy.

    “So in principle, the IMF would say fuel subsidies are better removed so that you can use the resources for other important sectors, which is a good advice.

    Read also: We have sufficient fuel, Kachikwu assures Nigerians

    “But in Nigeria, we do not have any plans to remove fuel subsidies at this time because we have not yet designed buffers that will enable us remove the subsidy and provide cushions for our people.”

    She added: “So there is no plan to remove fuel subsidy. We will be working with various groups to find out the best approach, if we have to.

    “We discussed this very frequently at the Economic Management Team but what is the alternative?

    “We haven’t yet found viable alternatives, so we are not yet at the point of removing fuel subsidies.”

    Ahmed also stated there are plans by the Debt Management Office (DMO) to issue N15 billion Green Bond to fund agriculture, power, health and water amenities to make life better for the people, saying the Green Bond will be the second one and would be used to finance agriculture, power sector – mostly solar projects – as well as for some in the water sector.

    She pointed out that the projects for which the funds will be applied, “must be green. They must be projects that are not contributing to carbon dioxide emissions to the society.

    “The first green bond issuance was successful and all the projects that were scheduled to have been financed have been done and the projects are at various levels of completion.”

  • Finance Minister okays IMF advice on subsidy removal

    Finance Minister, Mrs. Zainab Ahmed, on Thursday, described the International Monetary Fund’s (IMF’s) advice to the Federal Government on the need to remove fuel subsidy as a good advice.

    Speaking at the sidelines of the ongoing IMF/World Bank Spring Meetings in Washington D.C, she said: ” The advice from the IMF on fuel subsidy removal was good one but also we have to implement it in a manner that is both successful and sustainable.

    “We are not in a situation to wake up one day and just remove subsidy. We have to educate the people, we have to show Nigerians what the replacement for those subsidies will be. So,  we have a lot of work to do. We also need to understand that you don’t remove large amounts of subsidy in one go, it has to be graduated and the public has to be well-informed on what you are trying to do”.

    The minister said the minister met with the IMF and have reviewed the IMF Article IV Consultation with Nigeria report, which was positive. “The review was a positive one and had good advice from the IMF to Nigeria and they have indicated that they are available to provide technical support to improve our liquidity management, our debt management and other fiscal measures,” she said.

    Data from the Debt Management Office (DMO) showed that Nigeria’s total public debt rose to N24.39 trillion or $79.44 billion as at December 31, 2018 representing a year-on-year growth of 12.25 per cent. The 2018 debt stock is higher than that of 2017 by N2.662 billion.

    Mrs. Ahmed said President Muhammadu Buhari has directed that the minister looks at every area that requires reforms.

    Read also: IMF advises Nigeria to remove fuel subsidies

    Speaking on the Sovereign Wealth Fund (SWF) operations, she said:  “I would say that the Sovereign Wealth Authority has been doing well if you look at where we are starting from, we have achieved quite a lot of progress by building more of the fund from where we met it and by utilising the savings at the Sovereign Wealth Authority for projects that are physically visible. We still have some movements to go but the movement is a positive one”.

    The minister said the Federal government has asked the World Bank to review some of the initiatives that it has put in place, including those that involve them looking at implementation systems on areas they are providing funding for infrastructure.

    “What we found in Nigeria is that the Environmental and Social Standards (ESS) put in place by the World Bank is causing significant delays in the rollout of infrastructure. We understand that it is well intended but we have informed them that they need to review how they implement it so that we are not overtly slowed down because of the new proceedings,” she said.

  • IMF to Nigeria: remove fuel subsidy

    The International Monetary Fund (IMF) yesterday repeated its age-long advice to Nigeria – remove fossil fuel subsidy and deploy savings from the scheme to fix social infrastructure.

    IMF Managing Director Christine Lagarde gave the advice at the opening of the ongoing World Bank/IMF Spring Meetings in Washington DC .

    She urged Nigeria to establish Social protection Safety Net to help the government meet the needs of people at the lower cadre of the society. About $5.2 trillion has so far been sent on fuel subsidies and the consequences thereof, according to her.

    Ms Lagarde said: “I will give you the general principle. For various reasons and as a general principle, we believe that removing fossil fuel subsidies is the right way to go.  And the Fiscal Affairs department has actually identified how much would have been save financially, but also in terms of human life if there had been the right price on carbon emission as of 2015. Numbers are quite staggering. If that was to happen, then there would be more public spending available to build hospitals,  roads, provide educational facilities and lift more people out of poverty.”

    She called for more public spending being made available to build hospitals,  roads, schools and to support education and health for the people. “Now, how this is done is the more complicated path because there has to be a social protection safety net that is in place so that the most exposed in the population do not take the brunt of those removal of subsidies principle.

    Read also: Finance Minister okays IMF advice on subsidy removal

    “So that is the position we take. I would add as a footnote as far as Nigeria is concerned that, with the low revenue mobilisation that exists in the country in terms of tax to Gross Domestic Product (GDP), Nigeria is amongst the lowest. A real effort has to be done in order to maintain a good public finance situation for the country. And in order to direct investment towards health, education, and infrastructure,” she said.

    She spoke of the global economy’s uncertainty, adding that the world was a year ago talking about synchronised growth even as 75 per cent of the global economy was going through that phase.

    On global economic growth, Ms Lagarde said the forecast for this year is 3.3 percent. “But we contend that we are at a delicate moment. And this expected rebound from 3.3 in 2019 to 3.6 in 2020 is precarious and subject to downside risks, ranging from unresolved trade tensions, high debt in some sectors and countries, both public and corporate.”

    On borrowing from China, she said both the World Bank and the IMF were working together to bring about more transparency and be better able to identify debt, terms and conditions, volumes and maturity.

    “And this is an endeavour that we will pursue together and which the G20 has actually asked us to develop. So we are doing that, we are constantly encouraging both borrowers and lenders to align as much as possible with the debt principles that have been approved by the G20 and that we have endorsed internally and developed ourselves.  It is clear that any debt restructuring programmes going forward in the years to come will be more complicated than debt restructuring programmes that were conducted 10 years ago simply because of the multiplicity of lenders and the fact that not all public debt is offered by members of the Paris Club, for instance, which does not mean to say that any debt from a lender outside the Paris Club is an issue as long as the principles are adhered to, the work that we eventually have to do with countries is then facilitated. There is also a myriad of nonpublic lenders that complicates the matter seriously. But that is another story,” she said.