Last week, the President, Major General Muhammadu Buhari (retd.), took disappointing action on the petrol subsidy removal. However, when analysed properly, his action was not out of character. While the debate was on over the removal of petrol subsidy, Buhari intervened by suspending the subsidy removal and postponing its implementation for another 18 months. It should be noted that Buhari’s regime will end on May 29, 2023. 18 months from the end of January 2022 will be June 2023. That is one month into the tenure of the president that will succeed Buhari.
What it means is that in addition to the run-down economy and unprecedented insecurity Buhari’s successor will inherit, the unfortunate successor will start from the first month to fight the crisis that will erupt as a result of the removal of oil subsidy, indicating that Buhari is setting his successor up for failure.
Buhari, having considered subsidy removal an issue that would give his regime bad press, had avoided taking that decisive action since 2015. In August 2021, Buhari eventually signed into law the Petroleum Industry Act, which contains a provision for the elimination of fuel subsidies within six months. The implication of this suspension is that the implementation of the PIA is also suspended. This means that the expected benefits of the PIA, like the attraction of private domestic and international capital into the downstream sector of the oil industry, are also suspended.
Before his election in 2015, Buhari sold himself to Nigerians as the no-nonsense general who would lead from the front. For example, in December 2014 during the campaigns, while promising to defeat Boko Haram if elected, he recounted how he dealt with the violent Islamic sect called the Maitatsine in the 1980s and ended his story with, “I flew into Adamawa as Head of State and that was the last you heard of Maitatsine.” Because of all the glamorised, heroic stories about Buhari, he was seen as a leader who would deal decisively with the terror group, Boko Haram, and take decisive actions in the interest of the country. Sadly, the group became more daring and destructive under Buhari. Two other deadly groups given fancy names—bandits and herdsmen—emerged from the North and worsened the security situation, making going to the farm or driving through most highways a huge risk. In addition, separatist groups and feelings waxed strong in the South-East and South-West, worsening the insecurity in Nigeria. With the military and the police overstretched and overwhelmed, each state has had to resort to creating its own community police. And the main cause of this is the aloofness, indecision, abdication of responsibilities, and cronyism that have characterised Buhari’s style of leadership.
Ironically, while he was in the opposition (before 2015), Buhari constantly condemned fuel subsidy. In fact, he made it clear that fuel subsidy did not exist, that it was a scam. In May 2015, just days before Buhari was inaugurated as president, he granted an interview to Daily Trust newspaper in which he made the famous but cynical statement, “I don’t know what fuel subsidy means.”
On January 1, 2012, the former President of Nigeria, Dr Goodluck Jonathan, announced the removal of fuel subsidy as a way to stop the huge funds that were frittered away in the name of payment of subsidies to different oil companies. The move made the price of petrol rise from N65 per litre to N141, sparking protests which were fully backed by the opposition. The protest, which was turned into a carnival, was code-named “Occupy Nigeria.” It crippled commercial activities in major Nigerian cities like Lagos and Abuja. Jonathan was portrayed as a callous leader who used the New Year to give Nigeria a terrible gift. The opposition made huge political capital of it. After over a week of protest, Jonathan succumbed to the blackmail and retained the fuel subsidy by reducing the price of petrol to N97 per litre.
However, upon coming into office in 2015, Buhari began to complain about the same petrol subsidy that he said did not exist. Rather than taking the bold step of completely removing the petrol subsidy and ending the loss of revenue, he began to increase the price of petrol periodically for the same reasons given by past administrations. Today, the petrol price is about N165 per litre.
An analysis by Premium Times in March 2021 showed that Nigeria could be expending a whopping N102.5 billion monthly to subsidise the retail cost of petrol. When put in comparative perspective with some critical sectors, the subsidy amount was far higher than the N70 billion the government budgeted for the provision of Universal Basic Education in the 2021 budget, as well as the N45.19 billion allocated for immunisation.
Last week, the Minister of Finance and National Planning, Zainab Ahmed, disclosed that the Nigerian National Petroleum Company had requested a total of N3 trillion (about $7 billion) from the Federal Government to fund fuel subsidy in 2022. In spite of borrowing money regularly to finance its projects, the Federal Government has been sinking money into subsidising the petrol Nigerians use. This has continued to impoverish the country as funds that should have been used to provide amenities for the country are used to make the price of petrol cheaper for those who use cars and generators. The argument of many Nigerians, including the labour unions, is that as citizens of an oil-producing country, Nigerians should be deriving some benefits from the crude oil produced by their country. They believe that if the subsidy is removed, the money that should have been saved would not be used for the upgrade of Nigeria’s dilapidated infrastructure but would be embezzled. Therefore, they see the petrol subsidy as their only share of the national cake.
For seven years, Buhari has not mustered the courage to do the right thing on petrol subsidy and save Nigeria from the haemorrhage. Last year, after finally promising to remove the petrol subsidy in six months time, he eventually chickened out this January, transferring that responsibility to an unknown person who will take over from him, thereby setting his successor up for failure. Perhaps the reason for that is that Buhari wants to make his successor unpopular early in the day so that Nigerians can rate him better than the successor.
By also postponing taking action on the petrol subsidy, Buhari is putting politics over leadership. This fits into the apt saying of James Freeman Clarke that the politician thinks of the next election, while the statesman thinks of the next generation. Buhari beat a retreat on the petrol subsidy because of fears that such a move would make him and his party, the All Progressives Congress, unpopular enough to lose the 2023 election. Consequently, the short-term interest of the individual, or a small group, overrides the long-term interest of the country and the next generation.
Petrol subsidy has not benefited Nigerians. The problem has always been the fear of the immediate discomfort it will cause the masses. Because of distrust of politicians, the masses do not believe that if the subsidy is removed, the proceeds will be judiciously handled. That Buhari who came in with a positive image of being incorruptible has not been able to win the trust of Nigerians that he can remove the subsidy and utilise the proceeds well is proof of how Buhari has frittered away his goodwill as a result of his many actions of commission and omission. Like it is said, integrity is like virginity: once lost, it is impossible to recover.
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