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January 20, 2018

Fuel subsidy regime: The human angle

Fuel subsidy regime: The human angle

Long Queque at NNPC Fuel Station at Eleme along Aba Road in Port Harcourt weekend. Photo: Nwankpa Chijioke

By Morenike Taire

January 9, 2012- the Nigerian Labour paraphernalia organized to embark on indefinite strike actions following the announcement by the Jonathan administration that it would increase domestic fuel pump prices.

It was the mother of all strikes, as we like to say, boasting a scope that had not been experienced in the country since the June 12 riots of 1992 following the annulment of that year’s presidential elections. A socio-political protest movement was born from it . Or perhaps not ; perhaps it was just midwifed from the restless belly of the Nigerian angst – a phenomenon whose time had come .

Occupy Nigeria, a quasi movement , was born on Monday, 2nd January in response to the fuel subsidy removal by the Federal Government of President Jonathan on 1st January 2012. Protests took place across the country, including in the cities of Kano, Lagos as well as in Nigerian embassies abroad.

After the June 12 riots, it was by far the most successful , employing social media in the dissemination of information and the propagation of ideas . For once , organized Labour, civil society and the private sector were on the same page –or almost- united ,as it was perceived , in the final battle against executive tyranny encompassing matters beyond fuel pump prices .

Increase in fuel prices was merely the last straw. The two arms of the National Assembly were also in revolt. The House of Representatives in an unprecedented action sat on Sunday January 8 and passed a motion urging the executive to rescind the increase and at the same time urged Organised Labour to sheath its sword. Nothing happened .

In the South east there were no protests as nothing had changed and the rest of the country was simply catching up as far as fuel prices were concerned. This did not deter the region‘s interest in the outcome of the civil disobedience.

In the anticlimax of the century, weeks and many deaths down the line, the government agreed to rescind on the new price regime, but not to status quo. To the chagrin of many, Labour agreed.

To assuage the disappointment of stakeholders and participants, it was reasoned that for the first time, the truth behind the subsidy regime was revealed for the consumption of the average Nigerian. A “Cabal” was unveiled, which until then had operated behind the shadows and which , according to government , perpetrated corruption of an incredible scale through which it enriched itself through the existing subsidy regime .

Actual intellectual debates characterized the question of whether the “Cabal” or the subsidy regime should be done away with. This all powerful “Cabal” was probably too powerful and wielded influence even within government circles, killing dead the will or wherewithal to get it out of the system. The subsidy would have to go.

It was to be the most intelligent conversation we would be having about our seemingly perpetual dependence on imported fuel. By two simple and simplistic actions the Buhari administration read the death sentence to the political economy by the astronomical increase in fuel prices, a move which met minimal resistance when it came.

The half heartedness of the resistance was thought to have arisen from a certain degree of hopelessness which has attended the citizenry’s perception of the administration. In reality, it was a true measurement of the degree of trust Nigerians had – that the Buhari administration would not rob them, and would look out for their best interests at all times.

This trust has been all but eroded. Nigerians were told, during the last round of price upward adjustments, that the downstream sector had been completely deregulated. What they failed to tell the Nigerian people is that they have put only a fraction of the cards on the table ;  that there are far too many factors that influence fuel prices and that many of those factors are beyond government’s control for now.

The “Cabal” is the least of our problems – getting a government which actually cares about the people is. Arguments about whether or not subsidy should remain or be removed are pointless , as history has shown us. The important fact is that current prices are already unaffordable for  many Nigerians and this is the main cause of corruption across board . The attempt to link subsidy with inefficiency is also unsubstantiated.

Tertiary Education is heavily subsidized and still grossly  inefficient. The presence or absence of subsidy does not guarantee efficiency. If need be , fuel subsidy must remain for three simple reasons .

Life in Nigeria is impossible without fossil fuels as we continue in our unending electricity conundrum. Exchange rates are tinkered with at will and subject to manipulation while pump price is inextricably tied to exchange rate. We would not be in this situation with a stronger naira.

Last and most importantly, the minimum wage is still 18000 naira  and so many still live on less than three dollars a day, which can barely buy a gallon of fuel. This, right there, is the main cause of corruption. You create desperation when the majority is actively excluded from the economy.