June 7, 2023

President Bola Tinubu’s petrol subsidy trouble, By Rotimi Fasan


When President Bola Ahmed Tinubu loudly proclaimed the end of the petrol subsidy regime in the Nigerian oil sector in his inaugural address, he probably didn’t anticipate the kind of reception he has been treated to by the leadership of Nigerian workers. The removal of oil subsidy has for many months now been a hot topic in the country.

Most Nigerians have more or less come to the dire realisation it’s a bullet they must willy-nilly surrender to if the country is to move forward. In the last four decades or thereabout, successive Nigerian leaders and governments have kicked the petrol subsidy removal can down the road with incremental pain on the people. 

Subsidy is not by itself a bad proposition and if any people deserve it on particular goods and services, it’s the Nigerian people. But its application has in this country been a tool of mass immiseration and the enrichment of a few at the expense of the vast majority. Its misuse and gross abuse, as some perceptive analysts have also observed, is not limited to the oil sector alone. It can be found in the dual exchange rate of the official and the parallel market which sees a few Nigerians smiling to the bank, procuring foreign currencies at official Central Bank rate only to resell them at wide margins at the black market.

With Nigeria sinking into a black hole of debt on which it expends as service charge at least 96% of its earned revenue, according to a 2022 statistics, it was clear the country has to steer away from its profligate ways that have left the people more impoverished than they have ever been each successive year that a decision is held back. This, if Nigeria is to remain afloat financially. Yet each step that is taken forward to bare the lion of petrol subsidy removal is matched with several steps backward. The workers’ union would step in, apparently on the side of the workers and for the retention of subsidy, the benefits of which are nowhere to be seen. 

The last round of energy crisis which started around April 2023 and was never to end until the expiry of the Muhammadu Buhari administration finally opened the eyes of many Nigerians to a grudging acceptance, if not a warm embrace, of the fact that subsidy has to go. Which is not saying that the benefits of the removal of subsidy are assured once the deed is done. But there has been too much of unknown fear created around the removal of subsidy. So much that many are now exhausted and ready to try out that alternative that official narratives have for several decades said would leave the government a lot more funds to cater to the needs of poorer Nigerians rather than sustain the greedy squander mania of a few of us. 

In the build-up to the February and March elections of this year, candidates of the leading political parties all pledged to remove the subsidy on petrol. It was a bitter pill, they said, we must all be ready to swallow. Atiku Abubakar of the Peoples Democratic Party, PDP, promised to remove oil subsidy as did Peter Obi of the Labour Party, LP. Bola Tinubu didn’t like George H. W. Bush ask Nigerians to read his lips but he was unequivocal in his campaign promises, one of which was that he would, like his two other opponents, remove petrol subsidy from “day one”. It was, thus, apparently in that mood that he proclaimed his position in his inaugural speech where he drove the nail into the coffin of petrol subsidy and since then the hordes of hell have been let loose. 

To be sure, the decision to do away with petrol subsidy had been taken after a few false starts by the Buhari administration. It just didn’t develop the balls to implement it. In the last few months of 2022 it swore to end the subsidy regime only to buckle in December. It recognised the decision it took for the hot potato it was and cleverly, if shamelessly, left its implementation at the end of June 2023, one whole month after Buhari would have been conveniently back among his beloved cows in Daura. Perhaps, in trying to hit the ground running as he had been advised, Tinubu spoke those four words the oil marketers as are other oil profiteers didn’t like and dreaded to hear. Now he has the unenviable task of either rising or sinking with his proclamation that sent the oil sector into a tailspin with a litre of petrol now selling for between 500 and 1000 naira across the country. It’s an unprecedented 170% increment in price that most Nigerians had not thought possible. But here we are more than one week after and we can’t tell if heaven will yet fall. With the Nigerian National Petroleum Corporation, NNPC, taking the lead, other fuel marketers haven’t looked back. 

The NLC had unlike the TUC foolishly rejected further negotiations and threatened to cripple the country. But for the Industrial Court decision that helped them save face, Nigerians would have known who would have blinked first between Labour and Abuja. But Labour must realise that it stands on shaky ground in its present position. The mood in the country has decidedly changed from what it was when the fear of the unknown held NIgerians bound to the bogey of petrol subsidy. They are ready to try something new and may not easily follow the worn path beaten by labour leaders whose past nonchallance to the peoples’ predicament and latter-day support for a presidential candidate gives their present stand a partisan outlook. 

The challenge now is for the Bola Tinubu administration to make clear what it plans to do in the immediate to ameliorate the suffering of the people and how it intends to utilise funds saved and channelled from the provision of petrol  subsidy to other causes. General wage increment across levels and drastic reduction in the expenses of public officials are things to consider in the first instance. Even when it probably didn’t want it, this government has balked the tradition of unnecessary romance between a new government, the people and labour leaders whose propensity to serve their own interest are now too well known to waste time about. 

For many years, Nigerian leaders have chosen the populist path even when that has availed the people nothing. For once, let’s forget the poetry of campaign promises and live the prose of actual governance. President Tinubu may have in just four words prised open a Pandora Box of bottled anger, real or manufactured, but his words could also mark the first steps of our long walk back to economic solvency.