BACK in 1988 when General Ibrahim Babangida wanted to embark on the first round of removal of subsidy on petroleum products, it unleashed a blistering campaign that Nigeria was the only country in the world where a bottle of Coca cola, then sold at 5 kobo, was cheaper than a litre of fuel that was sold at 2 kobo per pump price.

Between subsidy and deregulation

The spin doctors went to town that government needed money to fix roads, perform some “painful surgery” in hospitals; the government said it needed money to invest massively in agriculture and create jobs for the teeming young population leaving schools, it floated the idea of a mass transit system. General Babangida played a fast one by creating a dichotomy in the price of the product to favour commercial transport operators. It did not take long before the two prices were harmonised in favour of a higher price.

In the end the Federal Urban Mass Transit Bus Scheme was launched by the late Admiral Augustus Aikhomu. The original vision of a mass transit system which was to construct light transport system was dropped. The scheme did not solve the problem of mass transportation.

The second round of removal of subsidy came in 1991, but this time the plank of the argument changed as we were told that petroleum products were cheaper in Nigeria and the cheapest in the world which was the reason for smuggling the products across West African sub-region by a few unscrupulous persons to make quick money. The ineptitude of the security agencies was excused and explained away.

Between 1993-1994, the tone of the argument changed to “appropriate pricing” of petroleum products which was another smart talk by Neo-liberal theorists and apostles of “Do nothing philosophy of governments”. The same arguments that we heard in 1988 were re-worded and re- hashed and pushed to Nigerians.

When General Sani Abacha came in 1993, the bogey returned as he reversed the Shonekan’s fuel price hike but went forward to allocate N400.00 obtained per litre, to develop infrastructures .This gave rise to the emergence of Petroleum Trust Fund, PTF. We are all witnesses to the successes or short comings of PTF, but suffice it to say that Nigerians felt good with the accomplishments of PTF. Nigerians felt the impact of the increase of N11 per litre, but was set aside into a special fund.

While in office, General Obasanjo increased the pump price of petroleum products 12 times and even went a head to create the Petroleum Pricing Regulatory Agency, PPRA, that has the mandate to look at the disparities in the domestic price of the product and the differentials in the price of importing the product with the goal of setting aside the extra cost incurred by bureaucratic delays in discharging. The persistent protest by the Labour Unions have seen the forward and backward motions between government and labour.

When the country was repaying its foreign debt, Nigerians were patient and accommodated all the sophistry about subsidy enriching the rich and impoverishing the poor. Now the issue of removal of the so- called subsidy on petroleum products has persisted.

The same argument that government is losing the much needed revenue that it badly desires for infrastructural development persists. Yet, government has not summoned the courage to cut down on the heavy personnel cost of political appointees and the cost of maintaining these idle hands in the corridors of power.

Beyond removal of petroleum subsidy

The argument of proponents of removal of subsidy has moved from correct pricing to deregulation, then to addressing market fundamentals and now outright removal from incremental increases that have been dressed in different names. Government seems to have ran out of ideas. But if the truth is to be told, the proponents of removal of subsidies on petroleum products should tell Nigerians that this is one avenue that government levies collective taxation on a population that is averse to fulfilling its civic obligations. It is the same reason behind the persistent hike in electricity bill by the highly incompetent PHCN. Nigerians are being made to pay the price of misrule and governance, otherwise, there is a social cost of government which the government must bear as part of its social contract with the citizens but Neo-liberalism preaches abdication of government responsibility.

Today, we are listening to the arguments that the telecommunication sectors holds out the light of the beauty of deregulation yet the other imperatives of the argument are ignored.

Mr. Odiogor is a staff of Vanguard Newspaper