There are beliefs that oil marketers are the only beneficiaries of petroleum subsidies which the Federal Government advanced to justify the removal on May 29.
President Bola Ahmed Tinubu, had during his inaugural speech, announced the removal of subsidies on Premium Motor Spirit (PMS). His announcement followed the non-budgetary provision of funds for subsidy payments in the 2023 budget prepared by the outgone Muhammadu Buhari’s administration.
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Tinubu said proceeds accrued from payments of subsidies would be channelled to developing education, health and infrastructure that will benefit all classes of Nigerians.
“We commend the decision of the outgoing administration in phasing out the petrol subsidy regime, which has increasingly favoured the rich more than the poor. Subsidy can no longer justify its ever-increasing costs in the wake of drying resources.
“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,” the president had said.
Tinubu’s announcement plunged Nigerians into untold hardships and suddenly the pump price of PMS skyrocketed from an average of N200 to N550 across the country.
This, however, inflated transport fares and prices of other goods and services Nigerians, particularly, owners of small and medium enterprises heavily rely on. The productivity of Nigerian workers in many states diminished. The number of work and school days were cut because junior staff cannot ‘afford the 5-day commute to school or work’.
This unwanted development further compounds the already compounded economic woes of Nigerians who voted for Tinubu-shettima to reverse the trend. But soon, it appears that this hope may not come to fruition with subsidy removal being the first casualty of the policies of the new government.
WikkiTimes’ check shows that poor Nigerians, not the marketers are bearing the burnt of petrol subsidy removal.
Dr Hamid Adamu Muhammad, Head of the Mass Communication Department at Pen Resource University, Gombe State, said the government removed subsidies on petrol to helplessly watch poor citizens get poorer while encouraging the rich to get richer.
To him, the government’s claim that only oil marketers benefit from the subsidy regime to justify subsidy removal is propaganda to brainwash Nigerians to key into the idea without realising its consequences on their lives.
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“The government fully knows that poor Nigerians are the real beneficiaries of petrol subsidies but it decided to jettison the payment because it found doing so cumbersome considering the money that is going into the payment monthly.
“At the moment, poor Nigerians cover the gap in subsidy payment instead of the government. So by this, poor Nigerians are continuously being exploited,” he told WikkiTimes.
Dr Hamid argued that subsidy removal denied Nigerians the opportunity to enjoy the benefits of being citizens of a petroleum-producing country as it should.
He said there is no justification to end a crucial programme as a subsidy payment simply because it is allegedly ridden with corruption, adding; it is the duty of the government to vigorously fight corruption to allow citizens adequately drive home benefits from the system.
“There is no point in being in government if an administration cannot tackle corruption that is shortchanging Nigerians,” he said.
Also commenting, Professor Farooq Kperogi, a US-based Nigerian, said following the removal of subsidy, the everyday life of average Nigerians is fast collapsing.
“People are resigning from their jobs because the cost of transportation to work is now higher than their monthly salaries. So, unemployment, which is already unsustainably high, will triple with the attendant unsettling effect on society.
“The informal economy, where the vast majority of Nigerians are employed, is folding because small businesses can’t power their generators for their businesses in the absence of stable electricity from the national grid. Small businesses such as grinding machine businesses that use generators to power their engines are packing up.
Those that can afford to power their generators can’t produce because everyday folks can’t afford the new petrol-price-increase-inflected cost of the goods and services they produce. This reality gives the lie to the idea that we’re subsidizing “consumption” and not “production.” Consumption and production are not mutually exclusive; they’re mutually reinforcing,” he said.
Data show that annually, the Nigerian government expend about N4 trillion to fund subsidy payments on an ‘exaggerated’ 61 million litres of daily petrol consumption. In a month, the government spends N400bn.
WikkiTimes had earlier analysed how the N400 billion saved last month from subsidy removal could be used to uplift Nigerians from poverty.
The analysis premised on the approach the federal government used to dish out Conditional Cash Transfer (CCT) during COVID-19 in 2020, suggests that the government could give N200,000 each to 714,410 vulnerable persons in northern Nigeria. This will amount to N142,882,000,000 billion out of the N400 billion saved from the subsidy removal in a month.
The remaining N342,882,000,000 could be used to augment other things after dishing out palliative to the other 17 states in the country.
