The Subsidy Chronicle and Eventual U-turn, by Muhammed Belgore
NEWS DIGEST – God must be laughing at us. For the unbelievers, whatever God may steer their faith is mocking. For the entirely faithless who believe in nothing but themselves, they must be laughing at the mirror. Why the jest? Well, once upon a time the government of the day tried to stop subsidising petrol and majority of us protested against it.
The government backed down and continued its subsidy regime. Alas! The ruling party of today which was in the opposition at the time and were also part of the protests are now the ones in government, and they have decided to abolish the subsidy regime.
And I wonder if we are going to protest again. A vast majority sing songs of regret, wondering if they have not been fooled by the APC-led administration. Many believe that the absence of a common will to be patient is what the APC leveraged upon hitherto and used same as a ticket to power, especially as they seek now to introduce the same policy of deregulation that they joined the people in vehement protest against, not too long ago.
The subsidy chronicle is a short one. It goes back to a past not so distant, a time not so deep in memory so that any can recall. GEJ once increased the pump price of petrol and attempted to rationalize the increase with the subsidy removal argument. Nigerians did not listen nor yield. The Occupy Nigeria movement was born, one that in memory has not been matched in contemporary times.
Nigerians protested as one. The arguments for removal of fuel subsidy in hindsight were rational, but at that point in time Nigerians were not ready to listen to any explanation no matter how logical, they would simply not take it. The most prominent members of today’s leading party who were in the opposition at the time were at the forefront of the protest.
They leveraged on the negative and deriding feelings of the populace against the PDP and won themselves scores of fans. President Muhammadu Buhari at the time said it was all a scam. He marched in protest too. Indeed people like Sanusi Lamido Sanusi, Okonjo Iweala and a host of others argued that Nigeria could not continue the subsidy regime. They said it was antithetical to the diversification goals of the Nigerian economy and claimed that it was not a system sustainable for the future.
As I have said earlier, Nigerians did not care to listen. People protested on the streets and on Social media. Goodluck Ebele Jonathan would later back down and reduce the pump price of petrol. Effectively, the subsidy regime came back alive. Fast forward to 2020 and the APC which was in the opposition previously and the prime antagoniser of the subsidy removal while the PDP’s sun was shining, now seek to introduce the same subsidy removal policy.
Many are therefore questioning the sincerity of their previous stand and protests. Many inquire as to why they joined in marching against the introduction of the subsidy removal policy by President Goodluck Jonathan when a stitch in time would have saved nine. By now we would have been reaping the benefits rather than suffering the consequent brunt of the deregulation.
Indeed it does not add feathers to the hats of those in the President Buhari-led administration that they are now engaging in a U-turn. Yet, that is politics. Without being an apologist for the PMB-led administration that has disappointedly gotten a lot wrong since they came into power in 2015, I will attempt to offer convincing alibi for the APC’s previous participation in the protests against the removal of subsidy.
Perhaps, it is the natural result of a people looking in from the outside, although some of them were in government at the time in different capacities or had been in government in previous times when the subsidy regime was in force. It does indeed seem like a deceitful means to an end that they leveraged on the negative sentiments of the people towards the subsidy removal policy, yet it might not be the case. What may have obtained at the time in hindsight was a situation were they refused to argue for the ruling party, but instead sided with the people.
In no way can we expect that an opposition party does the work for the citizenry in terms of researching on a subject about which a government policy centers and understanding the ensuing benefits. If the economy is now in a place where it has suffered more damage because we refused to let go of subsidy at the right time then that is on the people and not the APC, afterall the people get the government they deserve.
I also would like to draw the attention of the people to the fact that the Goodluck Jonathan administration would not have reversed itself as a result of the clamour in the ranks of the opposition, it could only have been because the masses were not ready to yield. However, there is no denying that subsidy has to go. The humongous amount of money that is wasted on subsidizing petrol can be channeled towards other investments that can help in diversifying the economy.
One can even argue that it is a regime that helps the rich more than it does for the poor. When you think about the bourgeoisies who have a fleet of cars compared to the motorcycle owner or proletariats that own just one car or someone who in fact, makes use of public transportation, this point becomes germane. Although it is a give and take arithmetic cause when fuel price goes up in Nigeria it affects everything else, including the price of everyday commodities and even public transportation.
If other essentials would be provided for the poor through the removal of fuel subsidy then why not? But can we trust them to do the right thing? We have no choice but to leave the answer to time. Regardless of their sins on the subject in the past, that is to say ignoring the upsetting memory of the role they played in extinguishing the initial fire of fuel subsidy removal, the Buhari-led administration can seek absolution by now getting it right.
I am sure that they might want to defend themselves by saying they did not trust the previous administration to do the right thing with the funds that would be saved from subsidy removal, this is why they now must show results. The truth as I have alluded to above is that subsidy has to go and we cannot continue to postpone our day of salvation despite the resulting hardship. The subsidy removal pill is one we should have swallowed, suffered the side effects, reaped the healing benefits and forgotten about a long time ago.
Unfortunately though, that is not the case. Our economy is not in a good place, it has not been for a while, and so we need to take measures, crucial measures. We need to let go of subsidy, invest the money in other things, perhaps agriculture. Verily, the prevailing situation of the world, considering the effects of the coronavirus makes the timing more precarious, but that is the price we have to pay for not letting it happen at an earlier date. Again, a stitch in time they say saves nine and while the economy has long passed the point of needing just one stitch, we do not have to wait till the stitches needed become gravely numerous.
That is if we are not at that point already. It also becomes principally cogent that the President Muhammadu Buhari-led administration get it right on the subject because they have gotten almost everything else wrong. But I will not focus on the other numerous problems plaguing our nation at this time, there is no need to continue stoking a fire that is burning very hot already. Buhari needs to show compassion along with his stern will for change. The people need to be orientated and educated on the essence of the policies that affect them so directly.
Government has to find a way to review the price of foodstuff and public transportation because the situation is in dire need of a surgical procedure as people are starving. People are suffering. All is well that ends well. Nigerians have a habit of forgetting so quickly and they will not remember how bad things are now if the situation gets better, they will rather clap for and praise the President.
Concerning the power sector and the increase in electricity unit tariffs, anybody who knows what is happening in the power sector, would agree no doubt that the sector needed a tweaking, if not a complete reset. For Nigerians, I do not think there is any amenity with an inauspicious fate like it is the case with electricity. In fact, I have often wondered why we just cannot get it right. Often have I thought that the administration that solves the problems associated with power in Nigeria will be the one whose praises is sung in a universal tune. Why is it not possible for us to have a president who makes it his sole goal to fix this sector and does so seeing as it seems to be a factor that will lead to ease in doing business and better quality of life for Nigerians.
It seems to be that one problem that if solved will also indirectly solve a lot of other problems but we’re still tweaking and tinkering with the sector almost as if those at the helm will ever and anon be confused. A lot of Nigerians were happy when Babatunde Raji Fashola became minister of power but the story remained the same. Private players have been allowed to play their part as that seemed a better alternative as opposed to government solely running the sector but it seems like most Nigerians have infact resigned to the reality of eternally running and fueling generators, it is a very sad situation.
What obtains today that has led to the increase in electricity unit tarrifs? It’s more like the petroleum sector. A story of government shoring up the bills for the people. For many years, the market participants in the Nigeria electricity supply industry (NESI) have canvassed for a cost reflective tariff instead of the MYTO allowed tariff. The Nigerian Electricity Regulatory Commission (NERC) following the release of the new Multi-year Tariff Order (MYTO) 2020 directed the Distribution Companies (Discos) effective from the 1st of September to finally hike the unit price of electricity for a section of the country’s customers under the service reflective tariff regime.
However, its a known fact that there is a stretch on government revenues and a continuous push by development finance institutions (DFIs) for the government to end its subsidy regimes on all sectors. This is why the President has yielded to the cries for the modification therein, it is hopefully in the right direction. I believe that no cost is too high for an effective system that renders efficient, satisfactory service. All the people are interested in is positive results. Hopefully one day we will get there.
Two Other Things
The Lizard wins the Lion in Edo State
Hmm. While watching the Politics Today programme on Channels Television on the 17th of September I had to laugh when Seun asked Adams Oshiomole his thoughts on the fact that Obaseki said he was going to retire him come the gubernatorial election of Edo state on the 19th of September.
Adams Oshiomole replied in boastful terms which I did find really hilarious. He said he was a political Lion while Obaseki was a political Lizard so how could he win and retire him? I was therefore really interested in the result eventually so when Obaseki won I could only wonder. How is the Lion feeling now that the Lizard won the duel? Shame!
I cannot be the only one that has noticed the way Nigerians behave in traffic or at a junction with traffic lights.
Most times if you’re the one furthest in front you hear the cars behind you honking just as the light says green, almost as if it is expected that your reflexes to accelerate and the appearance of the green light should be in sync.
We are the most impatient people in the world. Often causing gridlocks and confusing situations on the road simply because we are constantly in a hurry.
Yet this is the most riveting factor. That how we behave while driving on the road, is exactly what our character while living our general daily lives is like. It is just the way we behave. Mostly a disorganized, impatient and slipshod group of people.
Muhammed Belgore is a legal counsel with Mahmud Magaji & co. He can be reached on [email protected]