The Minister of State for Petroleum Resources and Group Managing Director of the Nigerian National Petroleum Corporation, Dr. Ibe Kachikwu, has the gift of the gab. He sure can ask a man to go hell and make them look forward to the trip.
But honestly, I won’t mind taking that trip in his company, if only there’s enough petrol to get us there. I have read, re-read and tried to understand his explanation for the current mess, but I’m not getting it. Of course, he promised stable petrol supply next year, but his explanation about just how that is going to happen – clarity about whether or not the government will remove the subsidy on petrol – has been couched, not in English but in his native language, petrolese.
What does this mean?
“The total subsidy figure for 2015 when taken along with NNPC will be in excess of N1trillion. We can get the specifics but the point is largely that it does not involve NNPC because the agency takes its off-cuff. We will work towards taking those figures off our budget in 2016…the government doesn’t need to fund subsidy.
“There is energy around the removal. Most Nigerians we talk to today would say that’s where to go. I have since left the dictionary of subsidy by going to price modulation, which is a bit more technical. Price of refined products today is N87. It was N97 before it was removed and we really have to go back to that because we don’t really have the finance to remove it.
“There are lots of safety barometer between N87 and N97 per litre regime between which government does not have to fund subsidy….”
That was Kachikwu’s answer to whether the government will remove petrol subsidy in the 2016 budget.
Now, if that’s not petrolese, I don’t know what it is. What is the man saying? As I’m writing this, my heart is in my tank. My fuel gauge is verging on yellow and after a weekend of buying 35 litres at separate times between N180 and N200 per litre, I think I should know what to expect in the New Year, without mincing words.
The government has moved from, “we don’t believe there’s subsidy because we don’t know who-is-subsidising-who,” to paying nearly N700billion to petrol importers in five months only to end up speaking in tongues. What exactly is going on?
It’s not hard to figure it out. The government tied its hands with its own mouth. Following the expression of doubt about subsidy payments by President Muhammadu Buhari when he was a candidate, the facts now appear inconvenient. Not only as facts, but potentially, as a political landmine.
The government’s head knows the right thing; it knows that paying out billions of naira monthly for subsidy when it can hardly pay salaries is not sustainable. But its heart longs to appease a political base – the so-called masses that were promised kerosene at N50 per litre by the last government but have continued to buy it at twice the price and, of course, labour unions that love to live in denial.
Who gains?
The National Bureau of Statistics has just announced that petrol was the biggest import in the third quarter. The 2015 budget provided for N145billion in subsidy, but between June and now, Buhari’s government has paid nearly five times this amount in subsidy.
If we are not drinking any of it as laxative, why are petrol lines snaking all around as we pay through our noses for a litre? Why is supply short? Simple. Filing stations, except the government-owned mega ones, are not selling until they can decode Kachikwu’s petrolese. If they bought at X price, they will hoard stock until it becomes clear what the new price regime will be, plus replacement cost. That is enlightened self-interest.
While the confusion continues – confusion that ostensibly should benefit the masses – all sorts of profiteers are cashing in.
The folks who sold petrol to me in a jerry can at a street corner just a stone throw away from a petrol station on Saturday in Abuja, told me that since cans are banned, they now get their supply (in jerry cans) from security men, who are apparently immune to the ban. Attendants at the pump are smiling to the bank and petrol station owners are enjoying the best of two worlds: they fiddle with the pump and sell at black market rates at night and in the daytime, divert supplies to premium customers!
And the “masses”, the supposed beneficiaries of the subsidy, are left high and dry.
It’s easy to speak petrolese when the state fills your tank and you don’t have to worry about the petrol gauge in your fleet. Whatever Kachikwu chooses to do this Christmas, he must remember that there are thousands of consumers who are not as lucky as he is and whose misery must not be compounded by big grammar.
Dr. Kachikwu, is subsidy on or off?
Azu Ishiekwene is the Managing Director/Editor-In-Chief of The Interview magazine and member of the board of the Paris-based Global Editors’ Network.
This article was first published on Premium Times