THE FUEL
SUBSIDY REMOVAL POLICY: SO FAR, HOW FAR?
Oil
subsidy is a certain sum of money paid by the government on petroleum products
towards reducing the cost of refining the said commodities as well as their
transportation back to the country, in order to lessen the financial burden on
the final consumers.
The bitter truth is that Nigeria is
immensely blessed with petroleum resources but over the decades, the country
could not boast of a single functional refinery that would help in refining the
natural resources; hence, the raw materials are being taken to foreign nations
by oil marketers to be refined and afterwards, imported into the country for
consumption.
This implies that intriguingly, the
country had been involved in importation of products that were meant to be
exported to various other nations. So, in order to cushion the expected high
cost of the commodities, the Federal Government (FG) had to implement the Oil
Subsidy Policy.
Over the years, the Nigerian citizenry
enjoyed oil subsidy till the emergence of the President Mohammadu Buhari – led
administration that thought it wise to totally reverse the policy with a view
to boosting the country’s downstream sector. The downstream sector ensures that
the country boasts of functional and adequate refineries managed by either the
government or private investors.
The moment the All Progressives
Congress (APC) came into power, the FG rigorously and vehemently sold the idea
of oil/fuel subsidy removal to the teeming Nigerians. It took reasonable time
to make them comprehend how beneficial the proposed policy would be to all and
sundry regardless of class. The citizens were equally meant to note that the
oil subsidy policy was only to the benefit of a few individuals in the country,
particularly the oil dealers.
The
FG pointed out that the proposed Oil Subsidy Removal policy, when fully
implemented, would help to generate additional revenue that would be used to
boost the overall infrastructural status of the country, disclosing that
billions of naira were annually being budgeted for oil subsidy yet its basic
aim wasn’t achieved. Prior to when the majority of Nigerians were apparently
convinced that the oil subsidy removal would be beneficial to all concerned,
virtually every Nigerian was sceptical with the notion that it was only an
attempt of the politicians to exploit their meager resources.
Nigerians were meant to believe that
if the subsidy is duly removed, the pump price of fuel, which was then #65,
would eventually decline to at most #10 having resuscitated the country’s
moribund refineries. It’s noteworthy that the prime target was to rather use
the oil subsidy fund to revive the three non-functional Nigeria’s refineries
variously situated in Kaduna, Warri and Port-Harcourt.
Without due consultations with the
organized labour comprising the Nigerian Labour Congress (NLC) and the Trade
Union Congress (TUC), the FG took the bull by the horn in early 2016 by
outrightly removing the oil subsidy as being proposed. The abrupt step was
absorbed smacks of mischief by the masses, traders, as well as the civil
servants.
The FG thereafter proclaimed partial
deregulation of the downstream sector, thereby allowing any prospective
individual investor to establish and manage a refinery of his/her choice. The
proclamation was seen as a welcome development that was long overdue. On the
contrary, the fuel pump price was at the time increased to #145 by the FG,
still without the consent of the organized labour, stating that with time,
everything would fall into place; therefore, urged the citizens to exercise
patience. The government via the Petroleum Ministry further promised that the
Warri refinery would be fixed before the end of 2016.
It’s so pathetic and mind-boggling
that almost two years after the said policy was implemented, Nigeria as a
people is yet to boast of at least a refinery, after series of promises made by
the Minister of State for Petroleum, Dr. Ibe Kachukwu. Lately, the minister
publicly lamented that the government’s intent to resuscitate the country’s
moribund refineries was being marred by paucity of funds; if what the boss said
was something to go by, then one would begin to wonder what actually is being
done with the billions of naira formerly meant to cater for oil subsidy. Worse
still, the government is more concerned on borrowing funds to service the
country’s budget.
It is therefore needless to state that
the FG has so far failed the teeming Nigerians as regards the ongoing Oil
Subsidy Removal Policy, or all the pledges tendered in respect of that. The
country’s downstream sector is still wearing a pitiable look; the pump price of
petrol still stood at #145 as against its former price of #65; none of the dilapidated
refineries has been revived; no iota of plan to construct a new one. With all
these, who then would say that all is well? Think about it!
Comrade FDN Nwaozor
_____________________
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