FEATURE ARTICLE

Dr. Ibibia Lucky WorikaThursday, January 12, 2012



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WHEN IS THE BEST TIME TO REMOVE PETROLEUM SUBSIDY IN NIGERIA?

t must be stated from the outset what this article is not about. It is not about the arguments in favour or against removal of petroleum subsidy. Its adherents on both sides of the divide have already articulated these, and excellently too. With each side digging-in to its respective trench, opinions have become highly divided with fewer prospects that any side would capitulate to the other. There are no new arguments, although the data and facts used to buttress positions are as far apart as the divergent perspectives in the on-going debate. Notwithstanding, one area in which both proponents and opponents of petroleum subsidy removal agree is that the timing is wrong. When is the best time to remove petroleum subsidy? This article posits that there is no "best time" to introduce the removal of petroleum subsidy. In other words, whenever and whatever times Government implements the policy of subsidy removal, it would elicit the same reactions that we have seen. Against this backdrop, some have argued that, Nigerians may well live with it, but use these protests as opportunity to elicit significant concessions from government regarding not just palliatives, but principled commitment to transparency, accountability and good governance, which are so lacking in Nigeria. Although controversial, this argument is appealing. Others contend to use this occasion to request that the burden and pains of petroleum subsidy removal be much more equitably and rationally shared between the rich/powerful and the poor/helpless as against the current lopsided burden on the latter.


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Prof. Emeritus, Chinua Achebe including Caine prize-winner EC Osondu, Commonwealth writers' prize-winner Helon Habila and 35 other Nigerian authors recently issued a "Statement of Solidarity with the Nigerian People" in which the timing of the removal of petroleum subsidy was described as "ill-advised". They are saying that those who advised the President to introduce the removal of petroleum subsidy at this time gave him wrong advice. In other words, the President could have waited for a more auspicious time. Nigeria's former military ruler, General Ibrahim Babangida, who was reported to have said, "On the issue of fuel subsidy removal, it is my opinion that it is ill-timed" expressed a similar opinion. The question, perforce arises, "why is it ill-timed"? The Nigerian Labour Congress gave a glimpse of its grouse with the Federal Government on the timing thus: "Firstly, this same government told NLC and Nigerians that it was consulting and that the removal of subsidy would not start so soon but it removed it suddenly. This was the same government which suggested that the removal may come up sometime in April this year but suddenly removed the subsidy on the very first day of the year in a rather rude manner." The NLC has been much more forthcoming on its position regarding the timing of the removal. Government had indicated that it was consulting, but had unilaterally introduced the subsidy on 1st January 2012, against the representation it had made to Labour and the Nigerian people. In fact, government had given April as the most likely time for the removal of subsidy. April being the fourth month of the year could have afforded Government sufficient time to propagandize on its intended policy and win over the sympathy and empathy of Nigerians. It could very easily have thought through some of the conciliatory policies as 25% cut in salaries of political office-holders, which is considered, an after-thought. Indeed, a flurry of interviews, Press conferences, TV commercials and Newspaper advertisements may have prepared the people for the introduction of subsidy removal or so it would appear. Ultimately, most pundits agree that coming just on the heels of series of Christmas bombings by Nigeria's equivalent of Afghanistan's Taliban, the announcement on the removal of the subsidy could not have come at a most inauspicious time - on New Year day!

It is no doubt stating the obvious that Government anticipated quite well that its introduction of such a policy at the time it did would most certainly be met with opposition from Labour, civil society and public. Why then did it go ahead with the removal of fuel subsidy on New Year day? Why would it open a war on another front, while still battling Boko Haram? Olusegun Adeniyi in his well thought our piece titled, "Mr. President, Wahala dey!" in ThisDay (05 Jan 2012) opined that,

"After 25 years of talking about the removal of subsidy on premium motor spirit (PMS), President Goodluck Jonathan effectively ended the discussion last Sunday. While the jury is still out as to whether his decision was borne by courage or sheer foolhardiness, there can be no doubt about the fact that he has put his presidency on the line on this matter."

While government is yet to articulate its reasons for its timing of the subsidy removal, one can only conjecture amongst others that, first, it believes in the purity and superiority of its arguments for the removal of fuel subsidy. Rightly or wrongly, Government takes a long-term view of the consequences of its policy for the country as whole. It was prepared to sacrifice short-term inconvenience of its citizens for long-term benefits and sustainability. Now, if you accept this point of view, which one does not assume, then it is possible to see Government's decision as admirable and courageous, indeed. This is particularly so given that its policy indirectly takes on the cabal of petroleum marketing profiteers, whether in or outside of Government. Secondly, the Christmas day bombings and subsequent obsession with Boko Haram including the fear that it engendered were becoming a distraction both locally and internationally, taking its toll on Nigeria's already battered global image. It must have reasoned that by introducing the controversial policy to remove fuel subsidy at this time, it would deflect attention and criticism from the Boko Haram scourge as well as its handling of the crisis, while concentrating both international and national attention to fuel subsidy removal. Admittedly, petroleum subsidy removal and its aftermaths are now on the front pages of the news media, but Boko Haram and their continuing bombings are still very much on the agenda. They cannot be wished away, simply. Boko Haram still continues its bombings without let or hindrance and in sheer contempt of the Government and its recent declaration of a state of emergency in some parts of the Northern Nigeria. To the extent that in removing fuel subsidy at the time it did, Government has opened another front, while still grappling with the menace of the Boko Haram, its timing could well be said to be most certainly foolhardy!

When would have been the best time to implement the policy of removal of petroleum subsidy? If January is not a "good time" because, it comes shortly after the Christmas day bombings; and, could have been respected as a heralding the New Year, what of February? When one looked up Nigeria's public holiday calendar, one saw that, the 4th of February is Prophet Mohammed's birthday (Mawlid) and, therefore, a public holiday in Nigeria. Clearly, no responsible Government would want to incense Muslims on this significant holy day, the equivalent of Christmas in Christendom. Shortly thereafter is 14th of February, which though not a public holiday in Nigeria is a day reserved internationally and specially set aside to celebrate love. No right-thinking person would want to spoil the mood for lovers on this day or immediately thereafter. Sometime in March would have been the most auspicious time then, save for the fact that the Government would still have been accused of introducing the policy before the time it set for itself in April. Could the Government then have waited until April? April is another Holy month in Nigeria, this time, for Christians who would be taking time off to mourn and remember the death of Jesus on Good Friday (April 6th). Can Government then implement the policy in May? The globally acclaimed Workers Day is May 1. Introducing the policy in May could pitch the Government against workers, as it could smack of disrespect and insensitivity. Again, May 29 is Nigeria's Democracy day, which commemorates the return of democracy in Nigeria on May 29, 1999. Implementing this policy in May would have given greater impetus to the protests and what we see now would easily have been a child's play.

Looking further down into 2012, one discovered that August 19 is Eid al-Fitr (End of Ramadan). No sane government can introduce such an 'obnoxious' policy on its Muslim citizenry at this time. In other words, July is out (Saturday, 21 July 2012 is Ramadan), leaving only June, but is June that convenient? Do we remember June 12 1993? October 1 is Independence Day. October 26 is Eid al-Kabir (Feast of the Sacrifice) for Muslims. December 25 is Christmas Day and 26th is Boxing Day, the very reason why the policy was not introduced in December! The only window of opportunity available for Government is to introduce the policy in either September or November. How convenient are these months? September is the month for preparations towards the Independence Day anniversary. It is also when the academic year begins for most public schools, absent the usual strike-interruptions. It is unimaginable to have an Independence Celebration without the participation of schools children. The introduction of such a policy in September could disrupt such preparations from taking place and there could be no Independence Day celebrations however low-key. November 15 is when we have the Islamic New Year. What these go to show is that there is no "best time" for the removal of petroleum subsidy in Nigeria. Opponents of the removal of subsidy have not thought-through the criticism of ill timing, nor do they proffer alternative periods for the introduction of such a policy. Government's initial self-imposed April time-line was itself not properly thought-through and underscores why it has unilaterally reversed itself and introduced it on New Year Day.

If the removal of petroleum subsidy were Government's New Year resolution; and, given that New Year resolutions are pathetically short of target and implementation, observed more in breach than in observance, it remains to be seen whether on-going protests will not lead to a reversal of Government's policy. Segun Awoniyi did again comment, "...removal of fuel subsidy could be the single most devastating blow to organised corruption in Nigeria involving a collusion between the private sector (bankers, marketers, shippers etc) and top government officials." If this is juxtaposed with the long-term positive spin-offs and benefits to the economy (assuming the savings were transparently and accountably managed), the solution to the current impasse could partly lie with getting the best possible commitments from Government on transparency and accountability not just in the utilisation of the savings, but in governance generally. Currently, all eyes are on the President, but there is so much waste and mismanagement at the levels of the States and Local Governments. Nigerians can insist on palliatives, but that they are in place before full implementation of the policy to reduce the burden on the masses.

The Nigerian people are gradually beginning to view those who argue in favour of deregulation, generally, and subsidy removal, in particular, as being subversive of the Sovereign Will of the vast majority of the Nigerian people. They say the minority who favour subsidy removal can barely conceal its disguised contempt for the rest of society, in that it thinks the majority's arguments are either faulty or illogical. It is hoped that this unwitting impression is not the case. The effects of subsidy removal must be felt throughout the length and breadth of Nigeria and across the various strata of society - not disproportionately on the poor, while the "high and mighty" bestride the landscape totally oblivious and, therefore, unscathed by such a fundamental change in government economic policy. The President has conceded a 25% cut in the salaries of political office holders, although the gravity of the various take-home packages lie in the allowances and pecks of office. Much more concessions are needed not just from the Executive, but the Legislative Chambers at all tiers of Government in Nigeria. A Government that is reluctant to pay an 18,000 Naira minimum wage to workers in the public sector, cannot justify the millions spent as housing, furniture, wardrobe and all sorts of allowances for other public and/or political office holders.

As it stands, whether the removal of petroleum subsidy stays or not, what matters is the transformation of the strategies, mechanisms and procedures of governance for the common good at all tiers of government in Nigeria. If these protests highlight the flaw in governance in Nigeria (as per mismanagement, waste and corruption) then Nigerians will be better off. One expects incremental positive changes towards greater transparency and accountability in the body polity. Willy-nilly acceptance of the arguments of government on the removal of subsidy without raising any query on the why and how, its justification, modalities or implementation will just continue to entrench a culture of uncritical acquiescence to anything that is foisted on the rest of Nigerian society, good or bad. No society ever made progress that way. Unfortunately, the Boko Haram menace has complicated a principled protest. As long as Boko Haram continues as a 'brooding omnipotence' in Nigeria's landscape, there can never be a 'best time' to remove the subsidy on petroleum.

Dr. Ibibia Lucky Worika, Legal Adviser, Commonwealth Secretariat, London. The views expressed in this article are exclusively those of the author and must not be ascribed to the organization with which he is affiliated.

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