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Thursday, July 18, 2024

Fuel Subsidy Fiasco: What We Can Learn from the Chaos and Confusion [MUST READ]

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The decision to do away with the controversial subsidy on Premium Motor Spirit (PMS) was swift and effective, but for two months the dust raised has refused to settle. The government and citizens are yet to agree on how to mitigate the scorching impact of the policy on businesses and well-being of citizens.

No solution has been found because of the volatile nature of PMS and its pricing. A little tampering impacts every other item in the market. But here we’re talking of total subsidy removal, so, it’s a complex situation with lessons to take home.

The proposal by the Federal Government to pay N8,000 monthly to 12 million severely poor citizens for six months, to prop them from further degradation did not impress many. Some think the sum is too little. Others, who are a little well off think it doesn’t make sense to borrow $800 million to share for consumption, as it will not help the economy.

They emphasise production. The outcry was too loud for government to ignore, so it backtracked. Now, nobody is sure of what the immediate cash benefit to poor Nigerians would be. Discussions are on.

It’s also not clear whether the proposed 12 million will still be the target number after state governors rejected the so-called social register upon which the numbers were drawn. They denied knowledge of it, even though it was later said they were among those who generated it. So, while the economy bites harder and citizens are getting frustrated and some lawless ones are seeking self-help by engaging in petty stealing and daylight robbery to make ends meet, innocent and law-abiding citizens are hurting and agonising. The lesson here is that delay is dangerous.

Without allowing initial debate before policy implementation, the government assaulted Chapter 4 of the Constitution of the Federal Republic, which promotes the right to life and dignity of the Nigerian citizen. For the citizen to live, he has to have the means to sustain life. For now, petrol is an enabler in the pursuit of right to life. By making it too expensive, you have tampered with citizens’ right to life, irrespective of the bid to carry out economic reforms.

There must be a balancing between break-neck pursuit of taxes and government’s responsibility to citizens. The rigour that was postponed when government avoided a debate has manifested in a forced conversation to resolve the debacle.Now, the government and other stakeholders are talking. And that’s the beauty of democracy. Democracy is not the government of one man, it concerns all of us.

After the ‘subsidy is gone’ pronouncement on May 29 by President Bola Tinubu, in a jiffy, petroleum prices were adjusted from the previous N185 per litre to more than N500 per litre depending on which part of the country the dispensing was done. The farther citizens are from port of landing of imported fuel, the higher the price they will pay for the product, adding transportation costs.

Pipelines that were designed originally to transport fuel across the country have collapsed because of lack of maintenance. Trucks are used to lift fuel from Lagos to other part of the country and they run on costly diesel.

Citizens had adjusted, though painfully to the new reality because the majority had no choice. Besides, most informed citizens had seen it coming. For years, there wereattempts to rescue the oil and gas sector from lack of corporate governance through legal and institutional reforms. The efforts culminated in the signing of the Petroleum Industry Act (PIA) by the Muhammadu Buhari government.

A major aspect of it is the full deregulation of the sector to enthrone transparencyand accountability, key ingredients necessary to attract local and foreign investment. Another key aspect is to accommodate host communities, so that wanton destruction of oil and gas assets by disgruntled and genuinely underserved communities will be decidedly assuaged.

However, on Tuesday, July 18, citizens woke up to discover petroleum prices had gone up to N617 naira per litre. The Managing Director/CEO of NNPCL, Mele Kyari, tried to explain with a wave of the hand, saying the new prices were as a result of interplay of market forces and it will remain so until a favourable equilibrium is reached.

Those who import PMS source the dollar at prevailing market rates and that determines the pump price. All that was not too difficult for informed citizens to understand, even if it meant suffering and smiling; but the ordinary workers and artisans who use PMS to function in the absence of regular electricity cannot understand.

Those who travel kilometres to commute to work in the absence of efficient and cost-effective public transportation cannot understand. We are talking about citizens who have not known good governance all through the eight years that President Buhari presided to now begin another dispensation of hard life under the same All Progressives Congress(APC) leadership is not easy to live with.

The situation requires that those in government compel themselves to make noticeable sacrifices the way they demand of ordinary citizens. The height of such insensitivity by the political class was the N70 billion approved for legislators to settle into their offices. Our legislators hardly make sacrifices.

When citizens worked the numbers of the amount to be handed out to 12 million poor citizens compared to what legislators were to share, they got further enraged. Ordinarily, Nigerians are easy to deal with, and for being resilient and hardworking, they have been taken for granted since 1999.

Government was supposed to announce cushioning measures and sensitise the public ahead of subsidy removal. That did not happen because the President got carried away by the euphoria of inauguration to insert into the speech what the writers thought was too sensitive to let out on Day One. He even boasted about it later, sounding exultant without weighing the consequences.

Now that the multiplier effects of high PMS prices are here- increased inflation, prohibitive transportation fares, high prices of staple food and economy grinding slowly, everyone is getting troubled.

A democratic government is wired to consult widely and debate policies. That is why there is thelegislature, where representatives of the people are elected to engage in critical thought processes on behalf of constituents. But the 10th National Assembly is yet to settle down to serious work.

The Senate President, Godswill Akpabio, is yet to overcome the fright posed by those who challenged his bid for that office. He needs to overcome it and understand the challenges that confront the country. If the National Assembly had debated the palliative request from the Presidency conscientiously, they would have saved the President the embarrassment of having to review his original proposal. Ordinary folks mounted the debate and rejected it. Shame on you lawmakers!

At an expanded meeting of the National Executive Council (NEC) on the matter, chaired by the Vice President, Kashim Shettima, governors rejected the social register that had been in place and was reportedly used to transfer cash to some vulnerable Nigerians for many years under Buhari. The NEC which had the 36 governors in attendance said the register has no credibility. Governor of Anambra State, Charles Soludo’s baritone voice echoed that concern and there was no dissent.

Yet, certain advocates have mounted strident campaign to give back to the social register the credibility the governors pulled of it. They claimed the register was generated in states and there were no objections to its use until now. They allege that governors merely want to take ownership of dispensing palliatives in their states.

I think the governors should know best whether the register is credible or not. The fact that the register was generated in states does not make it credible, especially if civil servants were used to administer the processes. I can bet they did not leave the capital of their states to reach the Local Government Areas, not to mention Ward levels.

I guess that is why the register is so unpopular outside the consultants who were contracted to generate it. I have asked around villages in some local government areas if they are aware of any social register, no one has owned up. Neither can we randomly point at persons who have benefitted from it.

It shouldn’t be a big deal to publish the register on a website, with names, phone numbers and addresses of beneficiaries and how much they were paid and the year of payment. It is an important public document that should not be hidden within the wrapper of a humanitarian affairs minister or for a vice president to administer close to elections. For a register that was put together around 2016, it is due for a review because many people have become poor in the last seven years, not minding whether it is credible or not. So, the governors have done well to have rejected it.

It makes sense too that governors take charge of their own social register, being closer to the people. They should constitutionally be in charge to disburse palliatives or administer whatever social security that is available for their states. It is only in a fraudulent federation like ours that you will trust states to generate a social register for the Federal Government to administer. If you cannot trust them to administer, let them generate their own register.

Let governors not forget that citizens do not trust them either. They are the ones that give democracy a very bad name, because they run their states as empires and conquered territories. Let this be an opportunity for redemption. Rural communities are neglected and rural farmers should be served.

Alabi Williams is a former Editor of The Guardian and a member of the Editorial Board of the newspaper where this article was first published.

The opinions expressed in this article are solely those of the author.

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