Fuel Subsidy and the Common Man
By Abdullahi Abdullateef
“But I venture to assert that they will not be exorcised, and indeed they will be firmly entrenched, unless God Himself imbues a vast majority of us with a revolutionary change of attitude to life and politics or, unless the dialectic processes which have been at work for some twenty years now, perforce, make us perceive the abominable filth that abounds in our society, to the end that an inexorable abhorrence of it will be quickened in our hearts and impel us to make drastic changes for the better. There is, of course, an alternative option open to us: to succumb to permanent social instability and chaos,” late Chief Obafemi Awolowo said.
Nigerian government has over the years struggled to devise better ways of governing the Nigerian people . The stride led to the provision of fuel subsidies in 1970s by the Olusegun Obasanjo regime in order to cushion the effect of global energy prices on Nigerians.
Following the promulgation of Price Control Act in 1977, fuel subsidies became institutionalized and made it illegal the sales of product like petrol above regulated prices.
Study revealed that the hike of petrol prices started in 1978 when it was sold around 0.5 naira a litre and it took major shift during Ibrahim Babangida regime rose to 3.25 naira per litre and down to 1999 ( during Abdulsalam military government and the emergence of democratic elected government ) was sold at 20 naira per litre. From 2000 to 2015, petrol prices rose from 22 naira to 145 naira which increased over 100 percent in 15 years.
Nigerians witnessed first subsidy removal in January 2012 by the federal government. The Jonathan administration faced lots of controversies as Nigerians decried its negative effect on the economy.
In the eight years of Buhari administration (2015-2023), the federal government spent N11.34 trillion on financing fuel subsidy for Nigerians. Many compatriots have faulted fuel subsidy and opted for its removal so that the money could be directed to other non-oil sectors such as health, education and agriculture.
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Meanwhile, President Bola Ahmed Tinubu in course of his inaugural speech said categorically that “ fuel subsidy is gone.”
He pulled above board to make such a controversial pronouncement and vowed that “we shall instead re-channel the funds into better investment in public infrastructure, education, health care and jobs that will materially improve the lives of millions.”
What is the plight of Common Man?
The aftermath of the removal of fuel subsidy has prompted untold challenges and hardships on the ordinary Nigerians as the Premium Motor Spirit (PMS) popularly known as fuel significantly increased.
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It is no longer news that the Nigeria National Petroleum Company Limited (NNPCL) released the official market cap for fuel in all the 36 states and the Federal Capital Territory,Abuja. Lagos got the lowest fuel pump price pegged at N488. But Borno and Yobe got the highest rates pegged at 557 naira per litre. These have generated a lot of uncertainty in the lives of many Nigerian people.
Despite the moribund refineries and insecurity in these states, the government has not adequately provided palliative measures to cushion the effect of the removal of fuel subsidy.
According to Picordi report, it estimated that N40,980 value of basic food products met the nutritional level of people living in Nigeria as at the begining of 2022. The food items include milk ( 10 litres) valued at N11,470, Bread (10 loafs 500 gram each) cost N4,310; and Rice (1.5kg) valued at N1,470, eggs (20 pcs) sold at N1,120 ; Cheese (1 Kg) cost N1,950; poultry and beef (6Kg) valued at N9, 790. Fruits of 6kg valued at N4,680 and vegetables (8kg) valued at N6,190.
Even in the previous years that the government financed fuel subsidy yet Nigerians could not live off the minimum wage of N30,000. This indicated that as at begining of 2022 the purchasing power of Nigeria’s civil servants was significantly low yet another blow from the current administration which has increased the pump price flew higher more than 200 percent since May 31,2023.
The controversy would remain unless the government provides palliative to cushion the effect on common Nigerians.
Stressing the frustrations over the removal of fuel subsidy, Trader in Abuja expressed overwhelming dissatisfaction in an interview with News Agency of Nigeria.
A corn seller, Agatha Emmanuel, expressed how she was unable to get fresh corn from farmers due to the hike in transportation fares.
“We buy daily from the farmers, but since Tuesday, I have not been able to go to the farm because from Dutse Alhaji to Bwari, where I buy the corn from, it is now N400.
“How much do I make in a day to spend that amount just for transportation? I make a little profit from the boiled corn I sell.
”I can’t make it,” she said.
Another trader at the Area 1 Shopping Centre in Garki, who lives in Kuje, FCT, Mrs. Edna Oke, said that the transportation fare from Kuje to Area 1 has increased from N400 to N1,500.
”By the time they see my sack of plantains, the car owner will charge me between N2,000 and N3,000. How much will I add on the plantains I am selling?
Will people buy it? I am begging the government to do something about this. “Maybe they should bring buses that will carry passengers at reduced rates,” she said.
In view of the foregoing, the government should further strengthen the economy by providing palliative measures such as reduced the cost of train fares, fast track the implementation of the student loans and more importantly subsidized the cost of health care services across the country.
Observing the atmosphere in the country, Nigeria being a low trust society despite the challenges faced by the common men they have remained optimistic and I think proper implementation of these policies would make Nigeria work again. I must say that it is better to suffer now than suffocating in the future.
Abdullahi Abdullateef
Faculty of Communication
Bayero University,Kano
