2nd March, 2012
During President Goodluck Jonathan’s presidential campaign, he told Nigerians that he passed through poverty in his early days and that he has experienced poverty. He assured that he knew the prescription against poverty.
The prescription, as Nigerians were made to realise, was the New Year Day announcement of the removal of subsidy on Premium Motor Spirit,PMS, also known as petrol.
With this development, analysts have said that the Federal Government has completely lost public trust and must, therefore, work hard to win it back.
The analysts noted that though the government’s safety net argument was laudable, previous administrations had at one time or the other introduced similar palliatives that were not implemented.
According to the experts, the Subsidy Reinvestment and Empowerment Programme, SURE, which the government said will mitigate the immediate impact of the subsidy removal on the population is likely to end up enriching a selected few.
They argued that the government should have first met the yearnings of the public by implementing some of the key requests by labour unions in the first quarter of the year before withdrawing the subsidy on petrol.
The analysts explained that because the removal of subsidy was sensitive, the government had to move stealthily, adding that when President Goodluck Jonathan presented the draft 2012 budget to the National Assembly mid-December, there was no mention of subsidy removal in his speech.
According to analysts, similar reasons may explain why the announcement was made during a holiday weekend by the PPPRA rather than the Minister of Petroleum Resources.
They, however, noted that arguments against subsidy removal were convincing, stressing that it had been said in the past that the removal should be deferred until full capacity had been restored in the nation’s refineries, as the subsidy regime had consistently undermined refining.
They further noted that though the benefits of withdrawal might seem greater than a subsidy regime, the Jonathan administration must be honest and must win the trust of Nigerians.
However, the uproar which greeted the removal of subsidy appears to be repeating itself, no thanks to the U-turn made by the Federal Government on the palliative measures it promised to put in place to cushion the effect of the increment on the pump price of petrol.
The Federal Government had earlier noted that the objective of the Subsidy Reinvestment and Empowerment Programme, SURE, was to accelerate economic transformation through investments in critical infrastructure to drive economic growth and achieve the objectives of Vision 2020.
On February 20, 2012 at the 58th National Executive Committee meeting of the Peoples Democratic Party, PDP, Mr. President announced that the goals of the Subsidy Reinvestment and Empowerment programme, which he initially vowed would serve as a first aid, was no longer realistic.
He argued that SURE was hurriedly put in place due to the tension emanating from the nationwide protests against the removal of the subsidy but that the implementation was no longer feasible, as the zero-subsidy policy proposed by the executive council was not implemented.
Jonathan, who cited a SURE document being distributed to attendees at the meeting, expressed surprise and ordered that it should be withdrawn. He also ordered his party men to retrieve copies of another SURE publication, which had been advertised.
According to him, “As I came in, I saw this SURE book being distributed, we are withdrawing it. This is the old one. We developed this with the expectation that we were going to completely deregulate the downstream sector of the oil industry (after) the 100 per cent removal of subsidy.
“You know we could not achieve that, although there was an increase in the pump price. I don’t want this thing to be distributed; it will give a wrong impression. We are working on a new document based on the reality, but we don’t want to promise what we cannot achieve. Those who have it, please withdraw it. We cannot realise the money that is stated therein, but we will still come up with a document based on what we get.”
Jonathan had inaugurated a SURE board, headed by a former High Commissioner to the United Kingdom, Dr. Christopher Kolade, for the implementation of the programme on February 13. The Presidency had said the choice of Kolade was deliberate due to his clean reputation, which would ensure transparency and accountability in SURE’s implementation.
The new development has generated reactions from stakeholders and it is also tearing the two chambers of the National Assembly, the Senate and the House of Representatives, apart.
For instance, while the upper chamber appears to support Jonathan’s move, the lower House said the move has vindicated its initial pessimism towards the programme.
According to the Senate Leader, Victor Ndoma-Egba, “The President said he wanted to remove subsidy, Nigerians said they don’t want it removed. Now that he was not able to realise his plan, where will he get the money to carry out that policy.
“The President will have to look at the proceeds from partial deregulation and work with what is saved. That is the reason why the document earlier produced should be revised to reflect the current realities,” he said.
The Chairman, House of Representatives’ Committee on Media and Public Affairs, Mr. Zakari Mohammed, argued that the House had consistently held the view that the government should consult with the masses.
He said: “We have been vindicated because we had initially opposed the hurried manner the SURE document was put together. We were saying that the funds for this programme needed to be properly appropriated by the National Assembly and moreso that we needed to have the details of the programme.”