“It becomes even more disturbing as the country would now borrow to fund the subsidy ” —Ebuka Onyekwelu
Perhaps, nothing epitomizes Nigeria’s ideological war more than the recurring argument over whether to remove or not remove fuel subsidy. Since the inception of this democratic dispensation, each government has had to deal with the issue of fuel subsidy removal, in one way or another. But largely, what is in display with the recurrent argument on fuel subsidy, is Nigeria’s confused economic direction. Nigeria’s political economy is unmistakably immersed in an unresolved confusion about the country’s path to development; whether through the free market option or through the welfarist option.
Politically, each Nigerian leader since this democratic era, simply dealt with the same struggle of creating a balance between what is best for the country and appeasing the masses with welfarist packages like fuel subsidy. The Nigerian masses themselves want a piece of the ‘national cake’ allotted to them in form of subsidies, which has since become unsustainable. Although it is public knowledge that fuel subsidy is a huge scam because of the uncertainty of numbers like how many liters of fuel consumed in Nigeria per day, how much exactly subsidized for how long, how many liters are imported, etc., the people know it, it remains difficult to get them to resolve that it has to go for good. From the side of the people, it is accepted that fuel subsidy is a scam enriching a few in an unimaginable way. The government knows that it cannot be sustained and that a lot of waste is entertained through fuel subsidy. Yet, it has been difficult for successive governments to take a bold step and put an end to it because, such a policy with a high risk of being conceived as anti-people, might have an irreparable consequence on the political career of any president. For instance, in 2012, President Goodluck Jonathan removed fuel subsidy, but quickly fell under intense pressure to return it. Unfortunately, that fuel subsidy removal gave impetus to momentous opposition to his presidency and because he and his team failed to manage the aftermath of the 2012 protest against fuel subsidy removal, President Jonathan could not be returned as president in 2015.
From 2015 to 2023, the amount spent on fuel subsidy under President Buhari, jumped from some billions of Naira during President Jonathan, to Trillions of Naira, to the amazement of all observers. Despite a law that has empowered the government to remove fuel subsidy, President Buhari continued with the fuel subsidy till the end of his administration, despite the huge concerns as to its viability, the former president left that impasse unresolved.
A balanced approach to fuel subsidy removal has always been the forte of these interest groups
The argument often advanced in support of fuel subsidy by the masses or defenders of the masses, labour unions, and other interest groups, is that fuel subsidy is the only direct benefit the people of Nigeria get from their government. A balanced approach to fuel subsidy removal has always been the forte of these interest groups. But over the years, it is obvious that such balance as fixing the refineries first, and fixing and expanding the transportation system, among others, simply meant that fuel subsidy would continue in perpetuity. Welfarist programmes for a struggling country like Nigeria as it is today, will not allow the country the luxury of fixing those infrastructure, so that subsidy can be removed. The endemic crisis of development in the country symbolized by ideological confusion of leaders, missed opportunities in which the country failed to properly deploy its surplus in the past to prepare for its future, among others, account for why the masses have nothing to hold on to or so they feel. But as the subsidy continues, it becomes even more disturbing as the country would now borrow to fund the subsidy. In fact, Mele Kyari, the Managing Director of Nigeria National Petroleum Corporation – NNPC, has maintained that the government has been unable to pay the corporation hundreds of millions of dollars outstanding debt, incurred from fuel subsidy and that the government can no longer afford it. The last budgetary provision for fuel subsidy ends in June 2023, after which there is no further provision for subsidy. So, in a way, to say that Nigeria has now advanced beyond fuel subsidy is actually the correct position of things based on clear provisions of the Petroleum Industrial Act 2021, as well as the 2023 Nigeria budget. President Tinubu cannot govern outside these provisions.
But in essence, what is at stake is Nigeria’s willpower to move along the line of a clear ideological leaning, without which the country will continue to stager in confusion and commit policy mishaps because of the pressure to create a balance and give the masses a sense of ownership as many see it. On the side of the government, President Bola Ahmed Tinubu is one of the most prepared presidents Nigeria ever had, so he is familiar with all the arguments and facts. He has been on the side of no removal of fuel subsidy and he is now on the side of removal of subsidy; a position he has maintained for years now and which he echoed during the electioneering campaigns. Therefore, President Tinubu’s position is not unexpected. Although some say the needed structures have to be in place and some say he should not have started with it. These are the same old arguments. But then, any serious government must run with its toughest decisions from the get-go. If it was a masses-enthroned government, such tough decisions would be taken care of by the goodwill enjoyed by that government. But if it was not a masses-enthroned government, then, the tough decisions will simply be added to the resentment against the government. Either way, it is important to remember that President Jonathan still lost the reelection bid in 2015 even after he reversed the removal of fuel subsidy.
Therefore, the fate of all governments is the same in the hands of the masses. Either a government is loved at the beginning, and hated later, or, it is hated from the beginning. This is so because, largely, the masses never really liked the idea of government. This is instructive to the effect that a leader must run with ideas that are best suited to serve the public interest and not controlled by the whims and machinations of fear of the masses and its electoral consequences.
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