Ethics of the Red Sea and Pharaoh’s Army: N380 PMS pump price?

WEDNESDAY COLUMN BY USSIJU MEDANER

info@medaner.com, justme4justice@yahoo.com

Last week presented the country with sad news. The deaths of the Chief of Army Staff and his aides is one too many for the country. At these critical times of waging an onslaught against national insecurity, the last thing that should happen to us is the death of the Chief of Army Staff. It is a hard time for the country, the families of the gallant soldiers who died serving the country, Mr. President and the entire Nigerians. May God console the families of the deceased and give the country the fortitude to move on from the sad event.

In the same week, the country was held in suspense and fear of the likely outcome of the desire of the governors to enforce a further and total removal of fuel subsidy to make more money available to the state coffer for whatever reasons. There were palpable fears across the country on what the outcome of that desire would be; analysis of culpable hardship and further escalation of the woes of national insecurity consequent and contingent on the increased hardship on the streets – as it is being considered in the public – filled the media space, while we all wait on the response of the Federal Government to the demand by the governors.  Personally, this time around, I differ in my opinion and response to the need to continue the deregulation of the nation’s oil and gas industry.

I have always been an advocate of the total deregulation of the nation’s oil and gas industry and my stand on the subject matter remains unchanged. In a nation soaked in unchecked corruption and unmitigated non-accountability of leadership, subsidising any product is more or less, more of a lucrative avenue for pilfering national wealth than it would appear of reducing the citizens’ suffering. Making the choice between continuing allowances of the few to use subsidy as leeway for stealing the country dry and claiming to provide succor for the masses, shouldn’t be too difficult for us to make in the interest of the country and the masses that are always eventually shortchanged. Since the early days of the Jonathan government, the pump price subsidy regime in the country collapsed into the most lucrative avenue for some politicians and their cronies to corruptly enrich themselves. We had a record of the subsidy liability of the country to about $8 billion yearly at some point in the past when all other variables remained the same. Without doubt, these monies were sidetracked into personal purses, and the practice has continued till date, though at a much reduced level.

In the past, we had seen how the fuel subsidy regime served the appetite and plans of corrupt-minded officers and individuals at various positions across the country. How the country was completely shortchanged along the lines of the processes of subsidising the products.  For the purpose of perpetuating the corruption imbedded in the process, we had seen the nation’s daily PMS consumption over inflated, to allow the diversion of excess to personal purses; we have seen records of Nigeria government paying subsidy on products that are later ferried to neighbouring  nations, at the expense of Nigeria and Nigerians.

And beyond the perpetuated corruption that literally took away the possible benefits of the subsidy regime from the Nigerian masses, also is the more cogent economic and social infrastructure development implications on the country. Given the magnitude of resources expended on subsidy and the opportunity cost of those resources, it doesn’t make all the economic sense to spend so much on subsidy while the country continues to suffer acute infrastructural deficiencies. At a time in the past, we were spending as much as $8 billion annually to offset subsidy on PMS; in a country that remained deficient of good roads, hospitals, electricity, schools and several other needed infrastructure.

The argument for the removal of fuel subsidy abound, but currently, so speaking, the continued implementation of the subsidy regime in the context of the prevailing Nigerian circumstances is impracticable, uneconomically, and anti-people. Perhaps, if we have been able to overcome the innate selfish attributes of individuals and groups that rubbish most good policies of the state, subsidy would have served its prescribed masses supportive role without becoming a menace to the country, in the magnitude of what is behind the scene in the Nigeria subsidy program since the last twenty-five years.

However, as much needed it is for the country to eventually come to term with the need to fully deregulate its oil and gas industry; taking out the government participation that is already tainted and is the avenue for the huge corruption that is spoiling the country, it is not a viable policy decision now, given the exigencies of the period the country is in at the moment.  This is not the time to go all the way, not even to consider any more movement in the direction that will increase the pump price of PMS by even a cent in the country.

The citizens are currently under the weight of poverty unknown to the country before now. We have had to square up with the struggle for survival as Nigerians several times before now, but the severity of the suffering of many Nigerians in recent times is unprecedented.  Costs of household goods have risen  by as much as 250 percent, inclusive of most staples; ability of families to survive has been seriously impaired; more children are being taken off school due to the incapacity of families to sustain them in schools or because of the family desperate need to have all their members in the labour market regardless of age as a part of measure for survival.

Income has been static for the employed; jobs scarcer for the jobless; while the value of naira continues its free fall. State governors are mulling to cut down wages or mass retrenchment as a cost-saving measure. In all these, the citizens remain on the receiving end. The nation indisputably is in crisis and in a state of emergency and we cannot at this material time take the course of events as prescribed by the arguments of the governors. We must divert from the normal to secure the safety, sustenance and survival of the citizens as a point of first call.

The arguments of the governor for pump price increase that reflect a hundred percent government non-involvement in the oil and gas industry could be great and beneficial for the nation’s economy at some other times, but right now, in the midst of the economic catastrophe facing the masses, it is draconian. I found it difficult to understand why state governors who should understand more about the suffering of the people they govern but are opting to prioritise improved resources at hand to the welfare and survival of the people they were voted to protect.

This is a nation where the states rarely present evidence of accountability of resources at their disposal; where despite huge resource allocation and accruals, the states remain perpetually improvised, the people increasingly streamlined from benefiting from the commonwealth of their states and the country at large and non-availability of basic infrastructure for citizens’ sustenance is the order of the day. To what extent can we trust the governors to want more funds in the interest of the people they have perennially been careless about in all ramifications, suddenly; perhaps, the funds are needed to prepare ahead for 2023 combats at the polls.

Of all time, in the midst of the biting insecurity, is the attendant fatal food shortages and the high cost of food stuff that has become a more direct burden on the masses beyond their capacity and that of the government to redress; this cannot be the right time for anyone, talkless of our leaders to mule creation of additional burden on the citizens. Not at a time when everything is responding negatively to the unmitigated insecurity in the land, when unemployment is perhaps, at its highest, and values for money is at its lowest; not because the government is underperforming but the realities of insecurity have overwhelmingly overshadowed all other performances and considerations.

It would be right to say at this moment that attempts by governors or whoever else to implement a total deregulation of the nation’s oil industry against the background of a nation struggling with mass insecurity and a people literally grounded as a result of multiple effects of several, simultaneous militating factors, is nothing short of an expression of governance without human face. And coming from governors who mostly possess no moral standing to even pretend they meant well for the citizens of their states, is a more categorisation of leadership insensitivity to the plight of the governed. Given that the governors are not bereft of advisers and first hand information on what the consequences of the action they propose would be to the very people they lead, we should all be worried of what leadership in Nigeria is becoming and the extent they are willing to sacrifice the welfare of the citizens for personal gains. Governance, in the real sense, should be a pursuit of the good of the governed with a human face and a commitment to community happiness.

The problem with the administration of the Nigeria state as shown by the desire of the state governors to force the system to increase the pump price of fuel at this critical time for the people is clearly identified as the failure of the system as it is to place the citizens at the center of decision making; not as targets of the decisions and policies but as agents and partners in decision making. Until we get to the point where the concepts of co-creation and co-production of policy decisions emerge in our governance system, leading to effective and working collaboration between the government and the people, we will continue to get to this point where leaders would prioritise selfish desires over the general well-being of the citizens and continue to impose draconian policy decisions on the streets in the name of executive powers. The point at which government engages systems to weigh in on the pulse of the citizens before making decisions that affects them; the point at which strong framework for citizens’ considerations, engagements and participation is enshrined in the government decision making process; when the effects and consequences of every government decision on the citizens are given full consideration before proceeding to giving life to such policy making.

Governance must and should have a human face. What probably would the state governors gain from accessing more money at the expense of the teeming population of the poverty-stricken populace they owe the responsibility to make life better for. Indisputably, allowing an increment of the pump price of PMS at this material, just like any other time, would immediately generate a boomerang economic effect across all sectors of citizens’ consumption. Transport fares would increase by as much as the proposed 130.3 percent increase in the pump price of the PMS; costs of staples would go up by as much as the same percentage. Eventually, nothing would remain the same; hell would be let loose on the streets and the citizens. Parents and families would go under more pressure to hold together; crime would naturally increase on the streets; insecurity would receive yet another wing. Or do we assume all the people will accept they cannot survive in their own states and country and resolve to fate? No! More criminals would be raised and descend on the system. We would have more kidnappers, more youths joining the camp of the bandits, more Nigerians identifying with the insurgents. So I couldn’t understand who the advisers to the governors are who tell them the opportunity cost of that selfish decision at this point in time is worth bargaining down. It is very unfortunate.

Shouldn’t the government realise that we got to the point where we are now because of the cumulative neglect of the citizens’ wellbeing by the government over the decades? Shouldn’t we realise that we bred arsonists, bandits, intifadists by the very many unfriendly, non-citizens oriented decisions we have made and continue to make.

Not now or in the nearest future would the argument for the continued deregulation of the nation’s oil and gas industry beyond where it is today will suffice as citizens friendly. Until we resolve the biting insecurity across the country, and free the prices of staples to return to what it used to be; until businesses can proceed without restraints imposed by multiple layers of safety considerations as it is today; until, corruption is taken off from the nation’s oil and gas industry and the palpable evidence of accountability is obvious; we cannot afford as a country to go the lane of further deregulation of the oil and gas industry.

Yet, we could make further attempts at salvaging the industry and reduce the cost implications of mass importation of refined products. With the recent allocation for the refurbishing of some of the nation’s refineries, and taken off corruption from the process, we can afford to step up local refining to reduce the cost of subsidy on the product.

Besides that, we are not totally without hope; Dangote’s 650,000 barrels (103,341,741.75 liters) per day refinery would be coming up and becoming operational in a few months from now. The access to the locally refined product from Dangote Refinery has already promised the country a drop of importation volume if not a total end to importation of finished products. That should be enough for the government to exercise caution and wait on the completion of the refinery as an escape route to the current massive subsidy regime rather than making inhuman attempts at making life more difficult for Nigerians.

With these options kept open, the time for the country to equally become more proactive and serious in diversifying the utilisation of its fossil fuel blessing should be now. We spend so much subsidising PMS while we fail to recognise the abundance of the nation’s gas resources; a deposit of gas that is second to none in Africa and is 7th place globally. Taking advantage of the Compressed Natural Gas (CNG) as alternative fuel of choice for automobiles and others would have been the practical way out for us a long time ago, but we refused to go that way and allow the nation’s gas to lie fallow and unutilised. Actually, with CNG, fuel users would be saving as much as 50 percent cost on running their autos while the environmental scare of using PMS and AGO would be drastically reduced with the eco-friendly, low carbon emitting C1 gases.

I will be concluding this piece with the submission to the governors and any other institution that may remain inclined to the probable increment of pump prices of fuel in Nigeria at this material time, to please, in the interest of the citizens already beleaguered by the woes of insecurity and its many consequences, to take a pause and reckon with the realities, to see the non-need for the pains that will come with such for the people of Nigeria. It is good that NNPC has officially declared it wouldn’t be increasing the price immediately but the tone of the announcement which read “NNPC would not be increasing the pump price of petrol in June” is not comforting enough because it also suggests the corporation could consider the increment some other months after June.

GOD BLESS THE FEDERAL REPUBLIC OF NIGERIA !