(Vanguard of Sunday, May 10, 2009)
I am not going to argue about whether the fuel we consume is subsidized by government or not. Or whether the marketers are having a field day smiling to the banks and being the people to blame for refineries we are unwilling or unable to refurbish. The issue has been so politicized that we will always miss the point that many have been making that our earnings should not be diverted into the pockets of greedy people, but channeled to making life more tolerable for the citizens of this country.
I have no doubt in my mind that where the citizens see things improving around them, they will make the sacrifices demanded of them. I just read in the papers that workers in Edo State, my state, now accept that they should pay tax. They will pay more where they see what is being done with the tax. It is unfortunate that when people speak about Edo State, they sing the praises of Dr. Samuel Osaigbovbo Ogbemudia, more than 30 years after leaving office.
It is because he worked. Those in Lagos seem to be happy that what their money is used for is emerging for people to see. Someone who came to see me from Calabar during the week was singing the praises of Donald Duke — how he told everybody who wanted to listen that for development to take place, toes have to be stepped on; how angry many were that he was encroaching on their community lands in building what they believed were white elephant structures; but how what he did then is fast paying off for everyone to behold.
The blame being tossed around between government agencies and marketers of petroleum products on this subsidy thing made me revisit a letter I wrote on February 16, 1993, to Chief Ernest Shonekan who was then chairman of the Provisional Council and Head of Government before the presidential elections of 1993. That was the time of the interim arrangement that had been made after all the presidential candidates of both the NRC and SDP had been disqualified and barred from taking part in future elections.
But I had to write the letter because of the debate that was raging on by how much the petroleum products we consumed internally were subsidized. I have asked in the past that we forget the word subsidy and call it a tax on fuel. Don’t be angry with me when I say that I prefer the word tax to the word subsidy. I would like to share the content of that letter with you this week and the next. Here is part of what
I said, “The little background I must give you on this matter (the so-called subsidy on oil) is that I was head, shoulders, belly, legs and feet into this subsidy matter when I was Minister of Information and Culture (between 1986 and 1990). A litre of petrol cost 39k then. It was argued that there was a subsidy which had to be reduced just a little bit to enable government raise some little more money for its many projects. If part of the subsidy was removed, the money would be spent on road maintenance.
The facts at our disposal showed that 45 per cent of the input for processing petroleum was imported. Nigerians were told in no uncertain terms that petrol as a natural asset, as a gift of nature, was not just drawn from a well and fed into a car. It had to be processed. The question of smuggling was illustrated with massive details of cost of a litre of petrol all over the sub-region, from Dakar in the West to Cameroun and Rwanda in Central Africa.
Journalists went on a tour of the West Coast and came away with facts and facts and facts. The more persuasive we thought we were, the more adversaries emerged from nowhere with bizarre arguments. I was at the Lagos City Hall with my public enlightenment team to talk to 16 groups in the motor trade and representatives of 150 market associations in Lagos. The atmosphere was so tense that NNPC officials would not show up for the briefing. Yet, at the end of the day, through explanations, the support from Lagos when there was a violent reaction to the adjustment in the price of petrol was highly commendable.
What surprised me when we started the campaign was that some of the newspapers behaved as if nothing was ever explained to them. Yet the first group of persons who were briefed on the matter after the AFRC meeting were key figures in the media. In attendance at the briefing were three of my colleagues in the National Council of Ministers—General Ike Nwachukwu, Dr Chu Okongwu and Alhaji Rilwanu Lukman. The surprise at the attitude of some media houses could however be explained by the fact that they had a commitment to some vested interests or they did not just want to be associated with a cause that was not popular.
The truth, Sir, is that any political discussion of an issue as sore as the co-called oil subsidy will never bring out the truth from those who should know better. We are therefore left at the mercy of gadflies that sting indiscriminately at targets without consideration for ability of the target to bear the sting. What we achieved from the campaign was 3 kobo rise in the price of petrol, and rioting that led to destruction of property.
Looking back, I know our approach was not the best, and that even if the message was right, people were not willing that the message should register. How could someone who paid, at that time, N10,000 to fill a tanker lorry with refined petrol, drove the tanker across the border and raked N250,000 ever accept that the price of the product should be adjusted to his disadvantage! It was little wonder then that when the cost was adjusted from 39k to 42k, the first group of persons to go into the streets were tanker drivers in a particular area where our refined petrol is loaded with impunity for export through borders that are manned by our own people who have to accept payment to let them through or face harassment or even threat to their lives if they would not cooperate.
I believe that the Administration of President Babangida learnt its lessons from that incident and so worked out other ways to address the matter. NNPC’s marketing arm would thenceforth determine the pricing of petroleum products and government would have no say in the matter any longer…”
We look at what happened with subsequent fuel price increases next week.
(Published in Vol. 3 of Democracy Watch, A Monitor’s Diary by Tony Momoh, pages 319 -332; Lagos, 2011).