Nigeria Occupying my mind

There are so many discussions and variations of this Fuel subsidy removal debate, and this is the opportunity for us all to educate ourselves. I have sat with oil marketers, chemical engineers and civil servants to fully understand the technicalities and realities of the oil/financial industry in Nigeria. I learn more each day, and I challenge you all to do the same. So my DISCLAIMER is that this is not from any position of expertise; but more from what occupies my mind. ‘I think, therefore I am…’ a young Nigerian female philosopher.
As a philosopher I base my arguments on the work of Rousseau “The Social Contract” this quote is apt “… the civil State can subsist only so long as men’s labour bring greater return than their needs”. When Nigerians’ realised that their labour would not cover their needs due to the deregulation of PMS, they stood up together to protest for their needs and #occupynigeria. Some in solidarity and some who had no CHOICE… (Those without a choice are those who earn 18k minimum wage and below). #occupynigeria signifies that civil society is finally standing up for what is unjust, and we are proudly standing together.

A lot of my friends in diaspora seem to be very unclear why we are protesting (online, on the road, from our homes), this is a summary:
The Fuel Subsidy was removed on the 1st of January 2012 on Petrol (PMS)
“Following extensive consultation with stakeholders across the nation, the PPPRA wishes to inform all stakeholders of the commencement of formal removal of subsidy on Premium Motor Spirit (PMS), in accordance with the powers conferred on the agency by the law establishing it, in compliance with Section 7 of PPPRA Act, 2004.
“By this announcement, the downstream sub-sector of the petroleum industry is hereby deregulated for PMS. Service providers in the sector are now to procure products and sell same in accordance with the indicative benchmark price to be published fortnightly and posted on the PPPRA website.”
Please note house of Representatives are trying to repeal the PPPRA act which was an appendage to support them which is now working against them.

The key point is that the government started consultations with the private sector and the NASS and before the conclusion of these conversations they IMPOSED the subsidy removal. The House has debated how this is unconstitutional/illegal and we watch this space for the outcome of the debate.
What happens when Oil becomes 200 naira per litre. Where is the impact analysis to show the worst case scenario? Are there any price fixing mechanisms that will kick in after a certain point?
SLS is an apologetic for the ‘poorest of the poor’ however there is no real plan to support these groups following deregulation. How will the most disadvantaged groups be protected? The association of the blind commented how this transportation initiative (to supply 1600 buses), did not take into account the fact that they should be customised to include the disabled. Unlike other countries disabled people in Nigeria have to double transportation costs and living costs to include their careers, because life in Nigeria requires that you are eternally dependent on your carers.

BEST ARGUMENTS ON THE TABLE
Femi Falana encourages us not to use fraudulent numbers as a basis for the budget in the future. The Senate on October 26th 2011 discussed kerosene arrears from 2009 which were included in the N1.3trilion subsidy number, this number can not be used therefore as the SOLE basis for the SURE program. No project should start off with INCORRECT numbers as input, because what happens in subsequent years when an arrear is not being paid for? Audit the existing process independently and start off as you mean to go on for an equitable outcome.

The Federation as is not working as it is; there is a huge debate about how to encourage states to be self-sufficient. How is distributing extra amounts of money into an inefficient bureaucracy the way to go?
The government propaganda is polarizing the issue so that we begin to see it as a Labour versus Government issue, and an issue along religious lines. However we should ignore this and focus on the main issue that the government chose not to consult its people, before it went ahead with an unpopular law.
Following the institution of the subsidy, the government has started discussing its SURE Program. They have also invested in media projects to explain their actions, huge question is why this did not come first. THe government are also making this a transportation issue and they are not answering questions about the multiplier effect of other aspects of the economy, such as rents, food prices, and essentitally the effect on the consumer price index.

DEMANDS OF OCCUPY NIGERIA
People are asking for transparency on what this entire subsidy removal process is, how it will work and for the government to associate numbers and specific timelines to the PROPOSED implementation of the fuel subsidy. We want the President to put the PMS price back to 65 naira, go back to the drawing board and restart the process properly with a real plan. Without a quantifiable plan, we cannot have accurate checks and balances. We have occupied Nigeria to demand ACCOUNTABILITY.
Ngozi Okonjo Iweala, defended the government transportation scheme of 1600 buses ( Mass transit scheme was launched on Sunday by GEJ), as the first CYCLE in the process. I think if there was a plan provided she would not have to emotively defend the process because the numbers and timelines would speak for themselves.
Maternal mortality is also political rhetoric, what plan is in place to empower local hospitals to address this issue. How is the Ministry of Health involved in this process? If there was a clear plan we would not be asking these questions. I will not dissect other proposals under SURE because they have not been presented in a manner worth debating.

“We need to go BACK to go FORWARD” Funmi Iyanda
SOLUTION- DUE PROCESS do things properly
There is a right approach and there is a wrong approach… Once OEM’s fix refineries as suggested by the government, and we are producing at 90% capacity, then they can implement a phased price fixing deregulation process with THREE clearly defined PROJECTs, measurable over a 24month timeline. The Government should realise it is not a SUPERHERO and therefore we do not expect it to deliver every single project acronym it is bandying about. If the government launched a diaspora bond and local infrastructure bond to FUND the fixing of refineries, I think we would all be more than willing to invest.
Sometimes the simplest solutions are the BEST! Will blog my simple solution tomorrow

My last blog post on the topic https://amamuses.wordpress.com/2011/10/10/subsidy-removal-neoliberal-delusion/

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2 thoughts on “Nigeria Occupying my mind

  1. Great summary which touches on the heart of the matter. A few questions:

    1) What is the next practical course of action by the people if petrol prices are not reinstated at N65 per litre; bearing in mind that we do not want the current situation to degenerate into a state of civil unrest?

    2) What are 3 key projects that the people should be requesting to be completed in the next 12-24 months that will effectively mitigate the effect of removal of fuel subsidy and the multiplier effect on the rest of the economy?

    • Thank you dear reader for taking the time to read this post.

      My answer to question 1 is that the action of the people is depenedent on a ‘conversation’ with their government. As SLS said in an interview earlier today, COMPROMISE is required to prevent civil unrest. Government is elected to execute the will the people, when someone is not doing their job, they get called into the ‘office’.

      Question 2, unfortunately should have been thought out well by the government. My analysis of the SURE program (my nexdt post), reveals dependency projects and no real immediate capacity projects. However to answer your questions, I agree with the government on 2 key projects (which need a lot more work)- the other 6 projects not very well articulated.
      1) Social Saftey Net Projects (we need to protect the ‘poorest of the poor’) this is very hard to account for
      2) Rice Irrigation Projects- need to be rewritten and fleshed out, as it appears in the SURE document it is lacklustre. How will we empower ‘NEW’ entrepreneurs to build capacity and work together to export product.
      3) Factor Building project – Tomato paste packing factor (borrowed from SLS), and Chocolate Factory (we are the 4th largest Cocoa producers)

      The government needs to adopt the mantra- JUST DO IT- Focus on 3 projects and not 8, and DELIVER.

      Under no circumstances should state governments and local governments be awarded another piece of the federal PIE, without pitching for funds with world class proposals submitted and reviewed by an independent board.

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