Fuel subsidy removal not to punish Nigerians, says FG

THE Federal Government has said the deregulation of the downstream sector of the oil industry is not aimed at causing hardship on Nigerians but opening up the sector for growth and investment.

It noted that even though the take off of the deregulation policy has brought about an initial hike in the price of fuel, government is taking measures to check the trend through the active participation of Nigerian National Petroleum Corporation {NNPC} in the sale of fuel to guard against profiteering.

The government spoke as accusations of non-adherence to the rules guiding how prices of petroleum products should be conducted by the Petroleum Products Pricing Regulatory (PPPRA) by other stakeholders that populate the board of the Agency are now emerging.

Meanwhile, a coalition of Labour, civil society groups and others has said it would start a nationwide strike today over the removal of fuel subsidy that has pushed the price of petrol to at least N138 a litre from N65.

Minister of Information Mr. Labaran Maku who made the remarks in Akwanga, Nasarawa State while addressing the people on the implementation of deregulation in the downstream oil sector said that the Federal Government had entered into partnership with the original builders of the nation’s existing refineries to turn them around for production at installed capacity between 18 and 24 months.

According to him, the move is in addition to three new refineries to be built in Lagos, Kogi and Bayelsa states by the private sector with government equity participation to refine 400,000 barrels of crude per day.

Maku assured that in the next two years, all the petroleum products consumed in the country would be produced locally. He expressed regret that price control of petrol had stifled the growth of the downstream sector and prevented private sector investment in the refining of petroleum products.

The minister said private investors would now seize the opportunity to establish refineries that will compete in production to bring down the price of petrol in no distant future and create more job opportunities for Nigerians.

He observed that for any meaningful  development to take place in the country, decisive measures have to be taken in order to correct the wrong policies of the past.

He cited the implementation of deregulation in Ghana’s oil sector which he described as a proactive measure to start oil exploration and refining on sound policies.

The Minister appealed to Nigerians to disregard those calling for mass protest over the deregulation of the downstream sector of the oil industry, saying the aim of the policy is to transfer subsidy from consumption to production.

He promised Nigerians that funds that will accrue from deregulation would not form part of the regular budget but would be managed by credible Nigerians from diverse interest groups and would apply the resources to projects that have direct bearing on the common-man.

In its reaction to the removal of subsidy yesterday, PENGASSAN accused the PPPRA of acting unilaterally by withdrawing the subsidy without conveying the board meeting.

Meanwhile, the National Assembly may have reservations about the removal of fuel subsidy but it is not part of its duties to stop the step, the Miniser of Labour and Productivity, Emeka Wogu has said.

Wogu, who stated this yesterday in Abuja at a media parley, argued that the National Assembly was saddled with the responsibility of making laws for the good of the country and stopping the Executive arm of government from running the economy in the most efficient manner will be an infringement on the duties and functions of government.

The National Publicity Secretary of PENGASSAN, Zaid Kolawole, who signed the statement said at no time did the board, which PENGASSAN is a member, met and approve the step.

“The PPPRA Executive Secretary should tell Nigerians when the Board of the agency of which we are a statutory member met to decide on this policy knowing fully well that the Board is yet to be reconstituted,“ he said.

Because of the non adherence to the rule guiding the operations of the PPPRA, PENGASSAN rejected the move and described it as a crass display of bad faith and unilateral increase in the pump price of petrol by the government in the guise of subsidy removal.

It insisted that the removal is a reinforcement of the government’s huge credibility deficit that only a few days after the Minister of Finance stated publicly that no date had been fixed for the so-called ‘subsidy removal’ and that government would further consult with all stakeholders, the same government through the PPPRA could turn around on New Year Day and increase petrol prices.

But speaking to The Guardian on the condition of anonymity, a highly placed official of the PPPRA asked if PENGASSAN can still claim not to know that the board of all parastatals, agencies and departments of government had been dissolved.

He said: “Sometimes, it is funny how some Nigerians behave. We all know that the boards of all agencies of government had been dissolved and yet PENGASSAN still claim to be a member of a dissolved board. The truth is that government cannot sustain this subsidy and even the environment does not support investment in the sector.”

In a statement issued yesterday, the coalition that goes by the name Joint Action Front (JAF) and signed by Comrade Aremu, said the action would begin at 8.00 a.m today. The Lagos action, according to the group, would start at the Nigeria Labour Congress House, Yaba, Lagos.           It statement sent to media houses yesterday read in part: “JAF declares January 3 as kick-off of mass action against the cruel hike in fuel prices! At 8.00 a.m. at Nigeria Labour Congress, Yaba, Lagos.

“The suffering must stop! Nigerians don’t deserve this punishment!

“Boycott and shut down all filling stations that sell fuel above the current prices – petrol at N65, kerosene at N50 and diesel at N70.

“Profiteers and looters slave masters and their puppets are insulting the people of Nigeria. We must not allow them to enslave us again.

“Freedom is not given, it is fought for and won.”

Also, hundreds of youths, male and female yesterday gathered at the Eagle Square in Abuja to gather momentum for a mass protest against the removal of fuel subsidy as announced by the Federal Government on Sunday.

The youths, led by former member of the House of Representatives, Dino Melaye, gathered at the Square to register their grievance against the subsidy removal in what is to culminate into a massive protest.

Though the Police had guarded the Eagle Square with heavily armed men, the youths, with Melaye at the forefront, sang songs and carried placards in a peaceful demonstration against the subsidy removal. They gathered on the street near the Square.

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By Onajomo Orere (Lagos), Collins Olayinka, Nkechi Onyedika, Abosede Musari (Abuja) 

Source: The Guardian