Subsidy Removal: Nigerians Gear Up For Showdown Against Buhari

Barely one month to the end of the President Goodluck Jonathan’s administration, a stage appears set for a showdown between the President-Elect, Muhammadu Buhari and the vast majority of Nigerians.

This followed the passage of the 2015 budget of N4.493tr, with allocation for subsidy on petrol conspicuously missing.

The development, which has already started generating tension across the country, is largely seen as a landmine on the way of the incoming administration.


The national budget, which was earlier passed by the House of Representatives last week, was N51bn
higher than the N4.425tr submitted to both chambers of the National Assembly by the federal
government.

This is also coming barely few days after Buhari’s ally and former petroleum minister, Professor Tam David-West gave Nigerians hope by declaring that the incoming president could reduce petrol pump price for as low as N40 per litre.

However, the senate approval of the budget on Tuesday, has confirmed the non inclusion of fuel subsidy provision in the document but contained N21bn for the funding of the Subsidy Reinvestment and Empowerment Programme.

The Chairman, Joint Senate Committee on Appropriation and Finance, Mohammed Maccido confirmed that the executive did not make provision for subsidy in the 2015 budget and that the National Assembly left it the way it was presented.

“There was no provision in the budget for subsidy but I believe there should be provision for it especially since there was already, a disagreement between the oil marketers and the federal government over subsidy payment”, he had stated.

DAILY POST recalls that the last time the federal government tried full removal of petrol subsidy, massive protest broke out simultaneously across the country, forcing government to reduce the price from N141 to N97 and later N87, few weeks to the March 28 presidential election.

The protest later led to the arrest of some activists as well as the killing of some protesters by overzealous security men.

One of the foremost critics of President Jonathan’s government, Balarabe Musa, had described the subsidy removal as “imperialist” and warned of “looming anarchy.”

Musa said, “The imperialist guided unilateral, vulgar and mindless removal of oil subsidy by the President of Nigeria, even if the subsidy existed before, has opened the floodgate of anarchy.

“It is also so unfortunate that the president did not have the executive and moral capacity to redirect the outcome associated with the decision.

“As it stands, the National Assembly, the civil society and labour should immediately take up the mandate of leading the people back from the anarchy that is looming. Any one of the above that takes up the mantle first should be supported by others. If not, what is going to happen in Nigeria will be a child’s place to the Arab Springs”.

Considering the above experience of January, 2012, the incoming Buhari’s administration may be heading for a collision course with ordinary Nigerians, who see petrol subsidy as the only major benefit the common man derives from the country as an oil producing nation.

Already, the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) have warned against any move by the government to remove subsidy from petroleum products.

Speaking on Wednesday, Deputy President of the NLC and chairman of the joint May Day celebration of the NLC and TUC, Peter Adeyemi, told journalists that organised Labour believed that government had never subsidised petroleum products.

The Labour leader lamented that the bane of the sector had been corruption, pointing out that past government tried without success to address the issue.

He said: “If you are asking whether we will back the removal of fuel subsidy, the answer is no. It is not as easy as that. You know that it has been a very contentious issue over the years. We have always said that there is nothing like subsidy. It is all about corruption.

“Let me take your mind back and say that this same issue has been something that numerous government have embarked upon without an end. During the Olusegun Obasanjo’s government, this exercise was embarked upon by the government about 11 times and both the NLC and the TUC engaged the government.

“So, it is like the more you look, the less you see. For us in Labour, we are not going to support that because it is outside our mandate as leaders. We hope that the incoming government, in a desperate bid to look for money, will not look for money in the wrong place”.

Meanwhile, further enquiries by DAILY POST showed that Nigerians are worried because they cannot see any infrastructures established with the funds the Federal Government derived from the partial removal of petrol subsidy in spite of all the juicy promises made by President Goodluck Jonathan, the governors and some of his ministers.

Before the partial removal of petrol subsidy, President Goodluck Jonathan explained that after consultations with segments of the society, “many have now been appreciative of the need to totally deregulate the economy so as to open it for investment as well as stimulate development from the proceeds”.

At the 2011 Christmas Carol held at the Banquet Hall of the Presidential Villa Abuja, President Jonathan said the removal of fuel subsidy would bring only temporary pains, which will fade as Nigerians begin to reap the benefits of the removal.

He said, “I promise that the pains will not be the way people are thinking. The pains will be temporary, and after few weeks or months, Nigerians will be better off, the economy will be repositioned”.

The governors under the Nigerian Governors’ Forum, while also advancing support for it, said subsidy removal “will create employments and begged Nigerians to “sacrifice” and “trust” them to properly utilize funds that would be saved through the policy.

The Chairman of the Nigerian Governors’ Forum and Governor of Rivers State said, “It is a sacrifice that we must make as a nation for the country to move forward”.

However, according to a public affairs analyst, Victor Anya, “it was later revealed that the governors only backed the removal of petrol subsidy so they could have more money to control since the Federal Government would no longer need to make deduction from their share of the Excess Crude proceeds to fund the subsidy scheme.

Anya recalled that, “On January 1st, 2012, when Nigerians were preparing to celebrate the new year, the Federal Government announced the removal of petrol subsidy which caused the price of the commodity to jump from N65:00 to N141:00.

“As the protests persisted across the country, President Goodluck Jonathan mobilized some of his ministers and aides to speak potently in support of the subsidy removal. Prominent among them were the Minister of Petroleum, Mrs. Diezanni Alison Madueke, Minister of Finance and Coordinating Minister for the Economy, Dr. Ngonzi Okonjo-Iweala, the then Central Bank Governor, Mallam Sanusi Lamido Sanusi etc.

“When Nigerians doubted President Goodluck Jonathan’s sincerity on the proper use of the funds from the removal of petrol subsidy as previous governments have in the past, increased the prices of petroleum products with the same promises to use the proceeds to provide infrastructures but failed to keep their promises after such increases, Dr. Iweala said, ‘We plead for patience. The impact of this will begin to show soon. We intend to start publishing the amount we are saving from this withdrawal of oil subsidy monthly and also where we are directing them. Nigerians will be participants in this process. In few months prices will begin to come down depending on market forces’.

“President Jonathan claimed subsidy had gulped N1.43 trillion by 2011 end. He said the government would realize N1.134 trillion from the removal of petrol subsidy. Thus, as petrol now sells at N97, (and lately N87), which is 50 percent increase from the previous price of N65, the Federal Government would have ranked in about N1 trillion in one year!

“Nevertheless, after making these promises, there is nothing on ground to show for the money which the Federal Government has realized from the removal of petrol subsidy! For instance, the Turn around Maintenance of the Port Harcourt Refinery scheduled for the First Quarter of 2012 has not yet began. The construction of eight major roads, two bridges, six railways, 19 irrigations, healthcare centers for three million pregnant women, etc are yet to commence.

“Can Dr. Ngozi Okonjo Iweala speak passionately on the benefits from the withdrawal of oil subsidy on Nigerians the way she spoke in its favour when the withdrawal commenced? Where are the buses for the urban mass transit which the Federal Government promised? Where are the palliatives President Jonathan and the governors promised Nigerians?

“Immediately after the removal of petrol subsidy, the Federal Government promised Nigerians better life under the Subsidy Reinvestment Empowerment Programme (SURE-P). Under SURE-P, the government promised the construction of eight major roads and two bridges, provision of healthcare for three million pregnant women, six railway projects, 19 irrigation projects etc. Now, it is time to ask questions and the questions Nigerians are asking are: (a) Where are the eight constructed major roads located? (b) Where are the two constructed major bridges sited? (c) Where are the healthcare centers for the three million pregnant women located? (d) Which part of the country are the 19 irrigation projects situated? Nigerians want President Jonathan, the governors, Minister of Petroleum, Mrs. Diezani Alison Madueke, Minister of Finance and Coordinating Minister for the Economy, Dr. Ngozi Okonjo Iweala and the then Central Bank Governor, Mallam Sanusi Lamido Sanusi, to answer these questions because they championed the cause to remove petrol subsidy!”

He added that, “When the Federal Government removed petrol subsidy and promised to use the proceeds to provide the above mentioned infrastructures, Nigerians made it known to the government that the absence of infrastructures in the country was not as a result of lack of money but due to corruption because every year budgets are made for them.

“Also, Nigerians doubted the sincerity of government to use the proceeds from the removal of petrol subsidy for the above mentioned infrastructures since previous governments have also removed subsidy from kerosene and diesel without anything to show for the money the government received. But Dr. Ngozi Okonjo Iweala assured Nigerians of the judicious use of the funds. Now, let her come on air and tell Nigerians where those projects they promised in January 2012 are sited. But I do not blame the likes of Dr. Ngozi Iweala rather I blame the Nigerian masses, Nigerian Labour Congress, Trade Union Congress, Save Nigeria Group, Civil Liberty Organization and other civil society groups who have refused to ask questions on how the subsidy funds are being used. Successive governments have failed to keep their promises because Nigerians don’t ask questions!

“With the elimination of petrol subsidy, the standard of living of ordinary citizens of this country has fallen drastically because the price of everything has gone up. A sachet of pure water now cost N10 as against the previous price of N5. Small and large scale businesses are folding up due to high cost of operation; leading to increase in unemployment rate.

“Thus, from all indications, the Federal Government has failed the masses once again because there is nothing to show for the money that was realized from the elimination of petrol subsidy in 2012. Since the Federal Government has failed in its promises, it should therefore revert the pump price of petrol to its former price of N65”.

Expectedly, as days go by, more angry reactions would trail the planned total removal of petrol subsidy. More so when a major petrol scarcity is looming in the country over government’s alleged failure to pay outstanding debt to oil importers.

With this development, it would take Buhari’s administration a supplementary budget to wriggle out of the looming labour action.

Chairman of the Senate Committee on Public Accounts, Ahmad Lawan, has hinted that despite passing the 2015 Appropriation Bill, the National Assembly was still expecting the President-elect to send a supplementary budget to the 8th Assembly, when he assumes power from May 29, 2015.