Fuel subsidy palaver

The long-awaited day we have been postponing for years has finally arrived. The issue of fuel subsidy has consistently been a contentious matter in recent years. Previous administrations have always promised to remove the subsidy but lacked the political will to follow through.

In 2012, President Goodluck Jonathan’s administration attempted to break the pattern by eliminating fuel subsidy. However, the result was massive protests across the country, forcing him to reverse the decision.

Former President Muhammadu Buhari, who had criticised fuel subsidy as a scam before taking office, was expected by many Nigerians to remove it without consequences. Yet, he too lacked the political will to do so and instead passed the responsibility onto his successor.

During the presidential election campaign, the major candidates – Bola Tinubu of the All Progressive Congress, Atiku Abubakar of the Peoples Democratic Party, and Peter Obi of the Labour Party – all pledged to remove fuel subsidy. Most Nigerians, having heard such promises countless times before, were sceptical.

Then came President Tinubu, who, on his inauguration day, declared to the entire country, “subsidy is gone”. Immediately after his statement, Nigerians flocked to fuel stations because they knew what would follow, and they were not disappointed. Fuel queues appeared nationwide. It has always perplexed me why fuel stations are hesitant to lower their prices when a reduction is announced, citing the need to sell off their existing stock, but are swift to raise their prices when there is a price hike for the same old stock. Nigerians truly possess a unique resilience.

The entire country has already descended into chaos. The price of fuel affects everything in Nigeria. We can anticipate price increases in goods and services, rent, school fees, and even dowries. Even the ladies of the night will raise their rates, attributing it to the rise in fuel prices.

What surprises me the most about this situation is that those who were advocating for the removal of fuel subsidy have suddenly become staunch critics of the removal. Will there ever be an opportune moment to remove fuel subsidy in Nigeria? I doubt it. Even if all the refineries are operational, a significant portion of Nigerians and organised labour will still take to the streets.

Will Tinubu backtrack on his pronouncement? I don’t believe so. Doing so would make him appear weak; I don’t think he desires that. So, what should he do? I do not envy Tinubu at this moment. He must demonstrate leadership and act swiftly.

One potential solution is to announce a 100 percent increase in the minimum wage in the short term. Many will question, “Where will the government find the funds to pay salaries?” However, plugging revenue leaks would greatly increase revenue. I consider raising taxes to be a simplistic method of revenue generation. The government must foster creativity. Expanding the tax base is the way forward.

Tinubu has already informed the security chiefs that he will not tolerate oil theft. That is the right approach. He must follow through with his words. Reducing oil theft and boosting production will significantly improve our revenue.

The elephant in the room is the daily fuel consumption figure. There is no way we are consuming over 50 million litres daily. We need to obtain an accurate daily consumption figure.

Moreover, one way to alleviate the suffering of the people is to flood the roads with transit buses to mitigate the burden of increased transportation costs. Tinubu must lead by example. I believe it is time to implement the Oransanye Report. There should be a reduction in the cost of governance at all levels. Relevant ministries should be consolidated. This is the moment to make tough decisions.

Already, the roads in the federal capital territory (FCT) are looking like it’s a public holiday these days. Most people have abandoned their cars at home. I also expect to see a rise in the cost of bicycles because it’s going to be a preferred mode of transport for many Nigerians now. For you to drive your car now, you should be considered a big man and be given a chieftaincy title.

Undoubtedly, there are challenging days, weeks, and months ahead. Nevertheless, Nigeria will survive.