Labour wants cheaper refining rate as govt, NLC, TUC meet

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Information Nigeria
Information Nigeria is Nigeria's No.1 Information Portal.

Labour-govtA MEETING by President Goodluck Jonathan with both the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) in Abuja failed on Tuesday to offer the magic wand for resolving the controversy over the fuel subsidy removal.

Rather, the meeting became an opportunity for the parties involved in the case to restate their positions.

And at the end of the last Federal Executive Council (FEC) meeting for the year 2011, the Federal Government said yesterday that it was yet to agree on a date for the beginning of the new period of a non-subsidised sale of the products that include, among others, Premium Motor Spirit (PMS) or petrol.

Briefing State House correspondents yesterday in Abuja, Minister of Information, Labaran Maku, disclosed that government was still consulting with various stakeholders and would lay the matter to rest at the appropriate time.

A statement by the Acting General Secretary of the NLC, Owei Lakemfa and John Kolawole, the scribe of the TUC, said there could not be any justification for Nigeria for not refining crude oil at cheaper rate than the N139 per litre government said refining of crude oil costs.

The statement read in part: “In its response, the Labour Movement noted that out of the projected N1.134 trillion to be saved from the subsidy removal, the local council allocation is N202.23 billion, states N411.03 billion and the Federal Government N478.49 billion and concluded that even if the Federal Government alone were to spend the entire N1.134 trillion, it cannot execute even a fifth of the projects it had listed. It noted that the Presidency’s presentation was simply a repetition of the presentations made by the Babangida and Abacha regimes and the Obasanjo administration, and that none of those promises were kept.”

Labour also faulted the “Subsidy Reinvestment and Empowerment Programme (SURE)”, which listed amongst other projects, the construction or completion of eight major roads and two bridges, provision of healthcare for three million pregnant women, six railway projects, youth employment, mass transit, 19 irrigation projects, rural and urban water supply.

It said: “If non-oil producing nations can refine petroleum products, a big oil producing country like Nigeria has no excuse to be import-dependent. Labour said government has basic responsibilities to the populace and not make externally driven proscriptions like the IMF did on SAP under the Babangida regime and that its opposition to fuel subsidy removal is driven by its belief that the people must come first on all policies.”

Labour argued that none of the presentations by the Presidency presented facts on the impact of oil subsidy removal on the populace particularly the informal economy where most Nigerians earn a living.

Labour also pointed out that some of the statistics presented by the Minister of Finance were joggled to reach false conclusions.

In rounding the session, the statement quoted President Jonathan as explaining, “that the idea of inviting Labour was not to make it take a decision either in favour or against fuel subsidy removal but to present the government’s position and encourage mutually beneficial discussions. He invited Labour to present its counter statistics and analysis of the government documents for discussions on a future date. Labour accepted this.”

The Presidency claimed that the actual cost of petrol supply is N139 per litre and admitted that all Nigerians benefit from fuel subsidy but claimed that the rich benefits more.  It also claimed that the current N65 per litre price is so cheap that it encourages smuggling of PMS across the country’s borders.

While government elaborated on how the savings from subsidy removal will be spent on social infrastructure, Labour responded by saying that government has shown consistently that it cannot be trusted considering how agreements and promises have been reneged upon in recent years.

Specifically, Labour complained that the Federal Government despite signing an agreement with it and issuing an enabling circular that the N18,000 minimum wage will be implemented for Federal Public Servants from August 2011, implementation is yet to start.

It concluded that failure or refusal of government to implement agreements reached is one of the reasons Nigerians do not fully trust government.

President Jonathan in his response said he was shocked to find out two weeks ago that the new wage had not been implemented by the Federal Government.  He blamed it on bureaucracy and that he was not informed about any difficulties in paying the new wage.  He said he had since directed his ministers and officials to begin immediate payment of the new wage.

With consultations still ongoing, NLC and TUC said they expected the Presidency would not remove fuel subsidy until it concludes the consultations with all stakeholders including Labour.

The session was addressed by President Jonathan, Vice President Namadi Sambo, Finance Minister Dr. Ngozi Okonjo-Iweala who doubles as the Co-ordinating Minister for the Economy, and Petroleum Minister, Mrs. Deziani Alison-Madueke.

Flanked by the Minister of State for Finance, Yerima Ngama, Maku said government was still engaging different groups in dialogue for proper understanding of the subsidy issue.

The minister said: “No take off date has been announced. The truth of the matter is our country is in a very difficult economic situation to continue to run Nigeria with one third of the budget set to subsidise one product is absolutely a path to a greater difficulty for the economy. We have continued to be talking about this because every sector we opened up has produced results”.

“People, who are emotionally talking about it, are not actually addressing what we are saying. Let’s take the media, before now it was only NTA, until government deregulated broadcasting in the country. Before you could not set up a private radio station in this country or a television station, when a government deregulated what do we have today? We have private television stations that are now competing with NTA and FRCN. If government decided to control broadcasting in the country all of you would have been out of job he,” added.

Maku continued: “I know we all feel emotional about subsidy. If you look at the movement of economy all over the world, unless we don’t want to develop this country and move forward, in broadcasting we have seen results. So also is the case in cement production, banking, aviation, and telecommunication,” he stated.

According to the minister, Nigeria’s increasing domestic debt now put at over N500 billion has made the removal of petroleum subsidy inevitable adding that the nation stands the risk of running into economic crisis if it fails to deregulate the oil and gas sector.

Maku lamented that after 33 years of investments in the oil and gas sector, it was sad that Nigeria has not benefited by way of credible investments in the sector.

He said further: “If we have wasted time in the past, this is the time we need to take a decision. No leader in the world would want to punish its citizens. The future holds promises because there is no sector that we have deregulated that has not succeeded. This is the path to growth, development and opportunity. This is the way to go.”

By the minister’s reckoning, Nigeria was the only country in the world with the level of oil and gas resources that had failed to deregulate the sector and urged Nigerians to bear with the government over its decision to deregulate the sector.

“We are urging Nigerians to take a harder look at what the government has proposed. It will save Nigeria, it will create jobs and investment opportunities. We are calling for understanding on this issue given the budgetary constraints,” he pleaded.

Also yesterday, Council presided over by President Jonathan approved $8.804 million, as payment for the full subscription of 62,000 units of shares allotted to the Federal Government in the Africa Reinsurance Corporation.

It also approved the sum of N2.58 billion in addition to $8.22 million, equivalent to N3.82 billion plus five per cent VAT of N190.76 million for gas supply to Niger Delta Power Corporation (NDPC), Alaoji, in favour of Messrs OLISERV Limited.

The project has a completion period of seven months.

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