Nigeria: No alternative to fuel subsidy removal

The Federal Government has asked Nigerians for understanding over the deregulation policy, saying there is no alternative to the removal of fuel subsidy.

It promised to provide sustainable palliatives to cushion the effects of the policy.

Briefing State House correspondents after an emergency meeting of the Federal Executive Council (FEC) yesterday, Minister of Information, Mr. Labaran Maku, said the government was not willing to postpone the evil day by indulging in half measures, while the economy collapses on everybody.

Rather, the government appealed to labour and other protesters to withdraw from the streets to prevent avoidable deaths and increasing the suffering of people.

He said: “Previous governments have postponed deregulation. The intended benefits did not come through because for as long as government continues to monopolise the sector, no private sector will come in and invest in it.

“Having taken this plunge, to go back will be to cripple the economy. That is why we are calling on our citizens to bear with us. In no time, the prices will come down unlike in the past where marketers used to hoard fuel because government was subsidising. That would no longer be the case. The customer will be king now, because if they (marketers) don’t sell, they won’t recover their money.”

He said apart from the N10 billion earlier provided for urban transportation through the Urban Development Bank, the Goodluck Jonathan administration had placed an order for 1,600 mass transit buses that would be arriving “in the next few days” to ensure a sustainable mass transit that would ease the pains of movement.

Apart from that, he said concentrating on revamping rail transportation, which had reached an advanced stage, would give some respite to roads.

When the construction of a modern rail line is completed, he said, the current single gauge would be dedicated to movement of goods.

Jonathan, he said, had directed that all civil servants should be paid their salaries by January 20, while the monthly Federation Account Allocation Committee (FAAC) meeting should be brought forward to January 15 so that funds for payment of salaries would be disbursed on time.

To ensure that those in the private sector also feel the ease of their palliatives, Jonathan directed that debts owed local contractors by Ministries, Departments and Agencies (MDAs) are compiled and paid so as to empower them to have funds to attend to their needs.

Apparently responding to the charge that the timing of the subsidy removal was harsh on the people, he said that measures to cushion the effects of deregulation started way back in 2009.

Maku said since several consultations had held between the time the government openly mooted the idea and the time of the submission of 2012 budget which had no provision for subsidy, the populace ought to have known that technically, “subsidy had been removed starting from when the budget was supposed to operate”.

He spoke on the other issues discussed at FEC, including a review of the security situation in the country.

He said all efforts were being made by the government to secure all parts of the country, especially the North-east and North-central where security threats and breaches were commonplace.

Maku dismissed the ultimatum given to Christians and Southerners in the North to leave the region as mere threats “to create panic”.

“The meeting was called by Mr. President to deliberate on very crucial issues of national significance particularly on the continuing battle to restore order in the North-eastern and other parts of the country affected by recent terror attacks as well as on-going deregulation of the downstream sector of the Nigerian petroleum industry.

“Mr. President in opening the meeting expressed deep seated sympathy and empathy with the citizens of this country particularly over the measures government has taken in the last couple of days to deregulate the downstream sector of the Nigerian oil industry. Mr. President is deeply touched also by the pains that citizens are going through because of the temporary jump in the prices of petroleum products as well as transportation in most parts of the country.

“Mr. President therefore called this FEC meeting to expedite action on measures to alleviate these pains which citizens are going through. He made it very clear that as the President of Nigeria, his role as president is to ensure that the welfare of Nigerians as well as the growth and development of this country become his major goals and that is exactly what he is pursuing. Mr. President therefore told members of council about measures the administration is already taking particularly to address the issue of mass transit in the country in order to bring down the cost of transport fares and alleviate the discomfort and pains citizens are going through at the moment.

“Mr. President therefore announced to council that already government has placed orders for massive supply of diesel engine mass transit vehicles. Conclusions have been reached with the private sector with key stakeholders in the public transport system including those transport organisations that are run directly by the Nigerian Labour Congress as well as the Trade Union Congress, the Road Transport Workers Union of Nigeria (NARTO) cooperatives and several other transporters in the federation to ensure that in the next couple of weeks, they will be available in this country sufficient numbers of mass transit vehicles which will be supplied duty free to transporters.

“The intervention in the mass transit system is going to be far more comprehensive and far more sustainable than whatever had been in this country in the past. So Mr. President directed that this programme of massive intervention in mass transit transportation will go on for two years and government is prepared to sustain this tempo to ensure that by the end of February this year, we should have achieved significant stabilisation in the cost of public transportation across the country,” Maku said.

He disclosed that the president further directed that every ministry, department and agency which has outstanding vacancies to be filled should immediately open up such vacancies for filling so that unemployed Nigerians could have a better life.

However, it was decided that primary suppliers of the vehicles would be companies which have production facilities in Nigeria; though where the capacity is not enough, the second option would be to import them.

But the beneficiaries would be those who have infrastructure on ground to run such transport system creditably so that by the end of next month, the volatile transport system would have stabilised for Nigerians to know that the government had a definite direction in attending to their needs, he said.

To add to other measures being put in place, the minister said the president also directed the fast-tracking of the implementation of the subsidy reinvestment programme which he had announced Dr. Christopher Kolade as chairman of the board, pointing out that the interest of Nigerians was at the heart of the matter and called on citizens to “endure short time pain for long time gains”.