By Pini Jason
ON New Year day, Nigerians woke up to be stunned by the removal of subsidy on petrol. Reminiscent of the days of SAP protests, the nation was understandably convulsed by angry demonstrations nationwide, with some resulting in unnecessary deaths.

Prior to the shocker of subsidy removal, the national umbrage was trained on the ungodly Christmas day bombing of St Theresa’s Catholic Church in Madalla, Niger State by Islamic terrorists, called Boko Haram.

To be sure, this is not the first time government was giving us this type of New Year gift. This is not the first time government pre-empted Nigerians and acted while debate was still going on. In 1986, while we were still debating whether to take the IMF loan, Gen. Ibrahim Babangida rejected the loan, without his Finance Minister, Dr. Kalu Idika Kalu, knowing that his boss was on national television.

Yet, Nigerians abused Dr. Kalu as they are now abusing Dr. Ngozi Okonjo-Iweala, simply because he once worked for the World Bank. We know were that got us. Those “experts” who misled the nation on the IMF “loan” issue have never found the courage to own up to their mistakes.

There is merit in patiently debating serious national policies before government rushes into implementation. In 1996 or so, the UK government wanted to increase pump price of petrol to raise additional revenue to reduce the budget deficit.

This raised a very robust debate, not threat of strike. As a result Ken Clarke, the Chancellor of the Exchequer, was forced to look elsewhere for the additional revenue he wanted. He got it by raising taxes on Champaign and tobacco, the indulgence of the rich.

Nobody can deny the hardship the removal of subsidy will initially impose on Nigerians. The untidiness with which it was implemented, not putting some ameliorating measures in place before, and the insensitivity of not giving Nigerians a week to return from the Christmas and New Year holidays, are typical of Nigerian governments.

That notwithstanding, I wish we had the guts 20 years ago to remove this subsidy. We would have long recovered from the pains. There is no way we would be paying the high price we are being asked to pay today.

The difficulties we face today are the result of what we failed to do in the past! If Gen. Olusegun Obasanjo did not capitulate to the subsidy cartel that funded birthday parties in the Villa and contributed generously to presidential campaigns and presidential libraries, he would have, in eight years, fixed our refineries and removed the subsidy!

Rather he created the PPPRA to superintend the subsidy graft! It has taken Niger Republic only four years to find oil, develop the infrastructure and build a refinery at Zindar in 18 months!

We have dilly dallied too much on this inevitable policy of de-regulation. It has been half-hearted attempts that cowered in the face of uproar by champions of economic populism. Every time de-regulation came up, “champions of the masses” in Prado Jeeps made the usual “we no go gree” noise and government pulled back.

At the height of this economic philistinism, we had deferential pump prices, one for private cars and another for commercial vehicles. And am sure some economic leeches sucked the nation dry then without our knowing it.

And talking about cabals and cartels, they are not new in feasting on the economy. They did not start today or with oil subsidy. They have always been with us, ravaging and holding our economy hostage. Petrol is not the only subsidy racket they have been involved in. Let me recall for you my view when we subsidised foreign exchange for this same cabal:

“The idea of foreign exchange regulation and allocation, apart from the obvious distortion in the policy, is highly suspect. Take the criteria of the so-called ‘Priority imports’ and you ask yourself if any import of finished goods, should rate as priority in a developing economy aspiring for self-sufficiency?

Moreover, the concept of priority allocation simply corners the foreign exchange for a cartel of highly influential and well-connected few who are unwilling to pay the right price for the foreign exchange. When you talk of frozen fish as a priority import, my mind goes to a family connected with government.

When you talk of sugar, you’re talking of just one big importer. Ditto rice. And when you allocate 20 percent at N22 when the market value is N55, you are actually subsidising the valued scarce foreign exchange for a few favoured super rich individuals.

And moreover, these people were also being given duty exemption certificates!” (I wrote this in Vanguard, 26 August 1994. See my book, A Familiar Road, page 253)

You can see that this subsidy argument has been with us. I have never been sympathetic to regulation or government intervention in our economy. Nigerian government never ran an economy; it simply used the economy for political patronage.

The same people who got subsidised foreign exchange in 1994 are the same people involved in the petrol subsidy racket of today. They are deeply entrenched and recycle themselves. Recall the corruption that went with the supply of petroleum products and bread to ECOMOG. Find out those who were involved. They are not different from the petrol subsidy cabal of today.

I am really irritated by the one-dimensional, simplistic mindedness of our labour unions. While this economic brigandage was going on they delighted in posturing, focused on the wrong issues and mis-educated the masses. Labour should think beyond shutting down the nation.

It hurts the economy and the workers at the end of the day. What labour should be rallying against is N300 million for dinner sets, one billion Naira for feeding in the Villa as if the Villa is a feeding centre for the nation’s destitute, and mind-boggling profligacy!

Imagine that a state Governor having difficulty paying civil servants the minimum wage is buying Prado Jeeps for each member of a rubber stamp State Assembly! These are the types of unconscionable recklessness that labour should take to the streets for!

The practice in the past was for government to fix a very high pump price, labour made noise and government “reduced” price and we all felt happy that labour had fought on our behalf. It should be clear today that those were pyrrhic victories.

I don’t think government and labour should resort to such shenanigan this time. Any demand to return to N65 is untenable, and to do so will be irresponsible of the Federal Government! Nigerians will be better off to put this deregulation problem behind them once and for all.

However, there is a question that is lingering in my mind and nobody seems to be discussing it. Has government fully de-regulated? What has happened to the Petroleum Equalization Fund?

This is money (subsidy) paid to transporters to bridge petrol to different parts of the country. In fact, this is the subsidy that ensures that pump price is uniform all over the country. If this still exists, then, de-regulation is still on paper, waiting for another battle in the future!

President Jonathan does not need to be popular to take painful but necessary decisions. Leadership is not a popularity contest. What a leader needs most is courage, not popularity. The point that government cannot be trusted is a universal truth.

We distrusted IBB, the man we perjouratively called “Maradona” but he de-regulated the electronic medium and aviation. We did not like Gen. Sani  Abacha, but he reversed the economic xenophobia called Indigenisation Decree.

We did not trust OBJ. We did not even like him. But he de-regulated the telecom sector. So it is not a valid argument that because people distrust government it cannot do what is absolutely necessary. No where in the world is a government trusted by the people.

That is why the media has to be vigilant and the opposition credible; to hold governments accountable. Indeed, my expectation is that the opposition parties in the National Assembly should have been the ones interrogating the removal of subsidy on behalf of Nigerians.

As for palliatives, the South East was cheated again on projects allocation. I do not think that throwing buses at the problem without thinking through the efficacies will do. The palliative that will ultimately work is a comprehensive re-tinkering of government and the way we throw money.

There is no country anywhere in the world as profligate as Nigeria. There is hardly any respect for public funds. Auditor General’s reports are either thrown out through the window or the incumbent fired! Corruption is more corrosive than we know. The Federal Government is too large and has become a burden on Nigerians.

Our economy is at the mercy of dumping. There should be a comprehensive review of what we can import into this country and at what rate of duty. Too many luxury goods this economy cannot afford are coming into the country at very ridiculous rates of duty. We must not be seen to be taking from the poor to satiate the appetite of those who have stolen from us!

And one very last point, if the Federal Government does not peg the period of importation of petrol, nobody will build any refinery in the country! The long term benefit is not in indiscriminate importation but in building more refineries. Licence to import refined petrol should be given to those who have refinery licences and they must be given a deadline of not more than 18 months, after which importation of refined petrol must stop.


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.