The new lease of life promised Nigerians by the incoming Mohammadu Buhari administration may start on a rough note as feelers from the 2015 Appropriation Act passed by the National Assembly last week indicate that no appropriation was made for fuel subsidy in the budget.
Going by current landing cost including margins of N128.96 for refined petroleum product which is later subsidized by the Federal Government with N39.00,an average Nigerian may now be forced to cough out between N150-N200 for a litre of fuel since the administration can no longer spend money not appropriated for
With this development owners of exotic automobiles, especially those driving turbo charged engines;V6 and V8 engines respectively, will have to cough out more to enjoy the luxury of driving such vehicles.
In the same vein, commuters would also be compelled to pay more for their trips as commercial bus drivers, taxis and cabs are expected to hike transport fares in the impending regime.
Currently, a litre of petrol is sold for N87 a litre.For a Sport Utility Vehicle(SUV) with capacity for 70 litres at N6,090,which can last for one week, depending on the distance covered .This amounts to N24,360 in a month.
But under the new price regime, when subsidy is finally removed,a litre of petrol may go for as high as N150 and this amounts to N10,500 for a 70 litre capacity for an SUV,when multipled over four weeks,that amounts to N42,000,in a country where the minimum wage is N18,000.
The House of Representatives had last week Thursday, approved N4.493 trillion as 2015 budget after raising the initial figure by N135.4 billion from the N4,357,960 trillion proposed by the executive in November 2014.
However, no provision was made in the approved 2015 Appropriation Act for fuel subsidy instead a lean N21 billion was provided for the Subsidy Reinvestment and Empowerment Programme (SURE-P).
Reacting to the development, the Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Mr. Obafemi Olawore, said allocation of zero resources for fuel subsidy in 2015 would pose a big challenge for Nigerians, wondering who would pay for the differentials in what was imported for 2015.
‘‘This is why we are trying to get the N256.2 billion subsidy debt owed us sorted out before a new administration takes over in May 29,’’he said.
Indeed, Olawore had in a letter to the Coordinating Minister for the Economy and Minster of Finance, Mrs. Ngozi Okonjo Iweala, dated 13th April 2015, lamented that the delay in subsidy payment has reduced the ability of marketers to operate because their financial and non-financial obligation is heavily impaired.
He regreted that the inability of its members to meet other relevant obligations like payment of transporters due to cash flow constraints from long overdue payments, adding that if the matter was not promptly addressed in the very immediate future his members may be forced to streamline overhead costs to remain in business.
Giving a breakdown of the N356.2 subsidy debt,Olawore explained that outstanding debt on forex and interest amounts to N215,868,237,459 while payment for Batch T of 2014 stood at N21,920,240,980.23 and Batch U 2014 at another N8,607,109,593.82 with Batch A 2015 amounting to N6,873,232,365.66 and Batch B 2015 at N2,911,139,639.70.
However, the MOMAN scribe said another N100 billion was equally outstanding, which the Federal Government gave as post-dated Sovereign Debt Note (SDN) due to mature by end of April as part of the 356.2 billion debt.
Olawore added that the SDN should not be a post dated financial instrument, it should be able to stand in as a form of payment which has not been honoured by the respective financial institutions.
Also reacting,the Chairman, House of Representatives Committee on Legislative Budget and Research, Mr. Opeyemi Bamidele said the absence of a provision for fuel subsidy in the 2015 Appropriation Act is a booby trap for the incoming administration of the President-elect, Maj. Gen.Muhammadu Buhari (retd.).
Bamidele, in a statement on Thursday, said Buhari and the All Progressives Congress should understand the full implications of this and take immediate steps to let Nigerians know where they stand on the
matter.
“The truth and reality of the situation is that the outgoing PDP administration has, through the 2015 budget, removed oil subsidy and it must be made to accept responsibility for it rather than for the incoming APC administration to bask in the euphoria of having won an election without realising the booby trap into which they and the Nigerian people are walking into,” he said.
The lawmaker, said apart from the reduced amount of N21 billion provided in the Act for the Subsidy Reinvestment Programme, no other provision was made in the budget for subsidised welfare services.
Bamidele warned that the absence of the provision for continued fuel subsidy portends grave implications for the Buhari administration.
The statement read, “To me, this is definitely a booby trap for the incoming administration. Those who were suggesting within the APC that the incoming administration might withdraw fuel subsidy must be educated that they would be sending Nigerians a wrong signal capable of creating the impression that the APC either deceived Nigerians to get their votes or had reneged on its electoral promise as a progressive party.
“This is a serious development and a defining moment that calls for the attention of all well-meaning Nigerians at home and abroad. This is the first time in the last 16 years of our civilian rule that a new political party will be taking over to form a government and if care is not taken, this matter is capable of making the incoming government morally dead on arrival.
“For the record and for posterity purposes, I am opposed to this sudden removal of fuel subsidy and I implore Nigerian patriots to be aware,” he said.
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Strategic objective for the Oil industry in Nigeria{ Revive all refineries to 100% capacity with a mantra the says; NO MORE IMPORTATION OF REFINED PETROLEUM:!
If indeed the assertions in this article are tru it is most unfortunate.
Not for the APC but for Nigeria and Nigerians.The booby-trap is not for the APC but for all Nigerian citizens.
This just goes to show who that the government doesn’t give a hoot about the average Nigerian.
If this story is true just imagine the implications for all of us…the writer talks about those the SUV’s and 6/8 cylinder vehicles…what about the street-corner barber who is just managing to fuel his “I-beta-pass-my-neighbour” generator and trying to keep his business alive so that he can pay school fees for the dilapidated public school that his children go to !
I really hope that the wind of change also blows through the conscience’ of our leaders !