Editorial: APC government should be sensitive with fuel subsidy
Since the inception of the All Progressives Congress (APC) administration led by President Muhammadu Buhari, it has been tales of woes for Nigerians especially those at the lower wrung of the ladder. Under the Buhari’s administration, the country has slide into recession twice in five years, an unfortunate feat that has never happened in the history of the country. The Central Bank of Nigeria (CBN) under his watch has devalued the naira severally and the country is deeper in both domestic and foreign debts than never before.
While Nigerians are managing to goop with this abysmal economic failure on the part of a government that promised Nigerians change, last week, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele kyari, at the presentation of the World Bank Nigeria Development Update, November 2021 edition, announced that fuel subsidy regime in the country would end by the end of February 2022. He said the Federal Government, base on existing law has no reason to subsidise fuel. “There will be no provision for it legally in our system, but I am also sure you will appreciate that government has a bigger social responsibility to cater for the ordinary and therefore engage in a process that will ensure that we exit in the most subtle and easy manner.”
To the fear of all Nigerians, especially the common man that make less than a dollar per day, the implication of the removal of the subsidy regime means that the price of Premium Motor Spirit (PMS) may go up to between N320 and N340 per litre. The sudden decision to remove subsidy in 2022 may not be unconnected with the recent advice of the International Monetary Fund (IMF) when it called for a reform in the fiscal, exchange rate, trade and governance in order to alter the long running lackluster growth path of the country. The international body described the fuel and electricity subsidies as retrogressive and challenged Nigeria to consider the removal as a priority as part of its fiscal policy.
Removing the subsidy when the country is going through teething economic period is far from a loft decision in spite the wastages, corruption and criminality that is perpetrated with the subsidy regime. We are concern that the removal, rather than achieve its said objective would further hamper economic growth of the country.
Although the government has said that about N2.4 trillion ordinarily that is supposed to go for subsidy in 2020 would be transferred to about 40 million Nigerians as transportation grants to cushion the effect of the subsidy regime removal, we are skeptical about the success and impact this grant would have on the ordinary Nigerians that truly need the grant to survive the current economic realities in the country.
As a media outfit we are less optimistic that the disbursement of the grant to Nigerians would be devoid of corruption and not shrouded in governance opacity. We are equally interested to know how the government intends to generate the data to determine the Nigerians that are truly the poorest of the poor who needed the grant.
Moreorver, we also fear the sustainability of the process considering that transferring about N5,000 to 40 million Nigerians monthly would translate to about N200 billion every month and nothing less than N2.4 trillion yearly if the plan would become feasible.
In fact, the government intention to give some so called poor Nigerians N5,000 monthly is ridiculous. This is nothing but a subtle way to siphon fund from national treasury toward selfish interest. Besides, how many times will this government removing subsidy? The same government told Nigerian in recent past while jerking up the fuel price in the name of forces of demand and supply that subsidy regime had ended.
We are not unware of the wastages and corruption that is associated with subsidy regime in the country however the Buhari-led administration has not garnered enough trust from Nigerians and we challenge the government to retrace its priorities by ensuring that basic infrastructure are in place, basic healthcare provision is at the reach of the poorest of the poor rather than give paltry sum to Nigerians every month. Providing this basic necessity would enhance the nation’s economy than handouts that would rather drain the scarce resources of the country.
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