The Guardian’s articulate & socially-aware Abati vs. Aso Rock’s Reactionary, His Excellency Reuben Abati

January 6, 2012


Absolutely unacceptable
By Reuben Abati, The Guardian, November 19, 2004

THIS week, the strike that was meant to be ‘”the mother of all strikes”, that is, the final and decisive showdown between civil society and the Obasanjo government did not take place afterall.

In a last minute act of self-reversal, and self-parody, the Federal Government took two steps which were meant to blunt the edges of labour’s anger, and win a measure of public sympathy. First, the price of kerosene was reduced from N62 to N52 per litre; and the pump price of petrol was taken down by seven per cent from N53 to N49. The public received the announcement with mixed feelings. Labour, not wanting to appear too difficult, suspended the strike, referring to the need to respect an anti-strike Appeal Court ruling as its reason for doing so. It has also since issued a warning that if the Federal Government fails to enforce its own directives, the aggrieved people of Nigeria, led by labour, may be left with no option but to go on the offensive.

Almost a week after the Federal Government’s announcement, petrol, kerosene, and other petroleum products are still being sold at the pre-Nov. 16 rates. The fuel marketers have been placing adverts in the newspapers outlining how much it costs them to import fuel and make it available, eventually, to the Nigerian consumer at the filling station of his choice. The marketers sound as if they are doing us a favour. They expect us all to be grateful that we even have fuel to buy in the first place. One striking effect of the Federal Government’s reduction of fuel prices is the growing blackmail that this may soon result in another round of fuel scarcity. Even now, some petrol stations have stopped selling.

What is clear, meanwhile is that we still have a long road to travel on the question of fuel prices, and more generally, the deregulation of the downstream sector as well as the supply of petroleum products. What has happened this week, is at best the postponement of the day of reckoning. We shall return soon enough to deal with the fundamental issues (the status of the refineries, the role and place of marketers, and the forces at their disposal, the policy of deregulation and the interface between policy and human fate).

However, what interests me in this reflection, is to assess government’s handling of the crisis, in terms of how it managed to shoot itself in the foot, ridicule itself, and advertise its incompetence. We all know that government has brought the pump price of petrol down to N49.00. And I wonder: how on earth can the Obasanjo government do this? Where did it suddenly find the powers to fix fuel prices? Hitherto, the noisy proclamation from Abuja has been that government is not in a position, in a deregulated market, to fix prices. Deregulation they told us, means that prices would be determined by market forces, and the least contribution that Nigerians could make to the process of development, is to those respect market forces. In Aso Rock corridors, and on the tongue of official megaphones, market forces were invested with an absolute hegemony, an impersonal and totalitarian ogre, beyond question or scrutiny. This is why the latest development is a bit confusing. The same government that was so scared of market forces has now set those forces aside; and exposed their vulnerability. What happened to their neo-liberal defence of deregulation?
The second revelation of the week can be found in the Federal Government’s resort to subsidy. Loading and depot charges have been removed from the cost to be borne by fuel marketers, resulting for them in savings of N4.00. This is yet another case of self-reversal for a government that had based its reform process on the withdrawal of subsidy. For five years, we were told that we live an over-subsidised life as Nigerians. When government officials throw the word “subsidy” at the public, they make it sound as if it is a sin to expect any form of support from the state. This is in fact, the anti-people attitude behind the current advertisement by government of a funny table comparing the prices of fuel in Nigeria with what obtains in other countries. But it is a one-sided comparison which does not consider the quality of life in those countries, the existence also in those countries, of social security, in comparison to the continual assault on the Nigerian citizen and the gross devaluation of our lives. With government now opting for subsidy, it can be said that the orchestrated opposition to subsidy has been demythologised.

It seems to me that the Federal Government finds itself in this strange situation whereby it has to turn its own logic upside down and harvest public ridicule first, because its policies are rarely subjected to necessary rigour, and even worse, because government is being run on an ad-hoc basis. The last man to speak determines policy. It does not matter if he knows nothing about the subject. Second, we are all being confronted with the costly realisation that neo-liberal economic orthodoxy has its limitations. Market fundamentalism is as bad as religious fundamentalism: it is likely to focus more on financial gain rather than people-centred sustainable development. The reign of market forces, in form of the re-organisation of the state to serve the interests of market forces may result in the deepening and widening of social dislocations. Neo-liberalism is also invariably elitist.

This elitism ought to be underlined. It is played out in the ignorance that is routinely displayed by government officials. It is evident in the gap between knowing and doing, between vision and reality – the bane of the operative economic framework. The third observation is by way of advice: the government’s reform process is on shaky grounds. It requires a review. It is “absolutely unacceptable” that a government in power and office, would appear as incoherent as we are seeing. I have used the phrase “absolutely unacceptable” advisedly. It is borrowed from President Olusegun Obasanjo,and in a moment, the reason for this shall be self-evident.

It is worth recalling, for assessment and record purposes, the announcement by government of two other palliative measures: (1) the proposed provision of loans to states for the importation of buses to ease transportation problems, and (2) the importation of pharmaceutical drugs. A simple question: how would these two options ease the burden of higher fuel prices? My quick take on this is that more than half of the money dedicated to this would be stolen at either the Federal or state levels. It would provide another opportunity for the award of contracts to political associates. In the end, the objective would be defeated. And why import more buses? Is this what Nigerians need?
Any effort at alleviating transportation problems should begin with mass transit or the diversification of transportation options. Why didn’t anyone think of the fact that the proposed buses would still need fuel, or that they are not going to provide free service? Pharmaceutical drugs? I do not see the connection between drugs and fuel prices. And if drugs are necessary, why import them? There is a local pharmaceutical industry in dire need of kinder policy intervention. In any case, why are we so obsessed with importation? Money that is meant to alleviate the suffering of Nigerians would in this instance, be used to create jobs for citizens of other countries, while the relevant local industries remain abandoned.

However, the loudest gaffes from official quarters in recent times, came from President Olusegun Obasanjo. He had appeared on television last weekend, in a rather unPresidential pose, to tell Nigerians that he did not know that kerosene is more expensive than petrol. Sounding somewhat genuinely disturbed, he had said: “this is absolutely unacceptable”. It must have occurred to the President, in that significant moment of epiphany that the poor man in this country is suffering. Indeed, that he faces extinction, if he can no longer afford to buy kerosene, the common man’s principal source of energy for domestic use. Again, in yet another dramatic incident, President Obasanjo was quoted as saying that there is poverty in Nigeria, but there is no abject poverty. He challenged the World Bank statistics which indicate that there are about 70 per cent Nigerians living below the poverty line. He then boasted that there is nobody living in rural Nigeria who does not know where tomorrow’s meal would come from.

Obviously, there are many things that President Obasanjo does not know, and this is dangerous for our democracy. He is the de-facto Minister of Petroleum Resources, and yet, he does not know the market price of kerosene. To use his own words, “this is absolutely unacceptable”. I don’t know whether the President has ever heard of kerosene explosions in parts of the country. And if he has, what does he think causes those explosions. In part, it is because people buy a little petrol and mix it with kerosene because they cannot afford to buy kerosene at N260 per gallon. The President also probably does not know that a cylinder of cooking gas is now about N3,000. Does he know also that the poor man in Nigeria has been suffering since 1999? When President Obasanjo assumed office in 1999, a bag of rice was about N2,000; today it is as costly as N7,000; in 1999, a “congo” of garri was N50, today it is N130; in 1999, a bottle of palm oil was N40; today, it is N110; a bag of cement in 1999 was N300, today it is N960.

The President also needs to know that life expectancy in Nigeria has dropped from 54 to 48 in the last five years. And that in both rural and urban areas, there are many Nigerians who do not know where the next meal will come from. There are people who are in fact eating form dustbins! Let him also be informed that many of our roads are unmotorable. To cite a familiar example, travelling between Ikeja, Lagos and his Ota farm could be an exercise in anguish: the roads are clumsy, the traffic is chaotic. He says there is no abject poverty in Nigeria. He is rejecting World Bank statistics. Does he know that two months ago, his own Minister of Employment, Labour and Productivity, Hassan Lawal, told a meeting of African Ministers in Burkina Faso that up to 70. 2 per cent of the Nigerian population, about 89 million Nigerians, are living in abject poverty, on less than one dollar per day? The Minister painted a picture worse than that of the World Bank. But now, President Obasanjo is quibbling about the character of poverty in Nigeria. It is “absolutely unacceptable” that the President would claim to be a better economist than the economists themselves. He should do something about this problem, and worry more about the failure of government policies on poverty alleviation so far.

We need no further evidence for the disconnection between the state and the citizen; and the reluctance of the leadership to engage in meaningful dialogue with the people on the issues that affect their lives. When President Obasanjo leaves office in 2007, he faces the risk of suddenly discovering the truth about the Nigerian situation. By then, it may be too late because angry citizens would confront him, embarrass him, and lay the truth before him. Unfortunately, he will be alone when that time comes. The sycophants around him today would have moved on to their next victim.

It is therefore absolutely unacceptable that those who are supposed to tell the President the truth shield him from the reality of our lives. The biggest problem that we face is this lack of knowledge at the highest levels. Power in the hands of men who do not know that which they should know, is like an explosive in the hands of a child. As they say, may God save Nigeria.


[Aso Rock’s Abati delivers a Message:   Animal Farm's Squealer would have been proud- TOLA]

Announcement of President Jonathan’s so-called “Subsidy Reinvestment

President Goodluck Ebele Jonathan has set up a high-powered committee headed by a former Chief Justice of Nigeria, Justice Alfa Belgore to meet with organized labour and all other stakeholders with a view to resolving issues that may arise from the removal of the subsidy on petrol.

President Jonathan has similarly appointed Dr. Christopher Kolade as the Chairman of the Subsidy Reinvestment and Empowerment Programme Board which is to oversee and ensure the effective and timely implementation of projects to be funded with the savings accruing to the Federal Government from subsidy removal. Major-General Mamman Kontagora (rtd.) will serve as Deputy Chairman of the Board.

The Subsidy Reinvestment and Empowerment Programme Board  will also include two representatives of the National Assembly, two representatives of organized labour, one representative of the National Union of Road Transport Workers (NURTW), one representative of the Nigerian Union of Journalists, one representative of Nigerian Women Groups, one representative of Nigerian youth, one representative of civil society organizations, the Coordinating Minister of the Economy/Minister of Finance, the Minister of National Planning, the Minister of Petroleum Resources, the Minister of State for Health, the Special Adviser to the President on Technical Matters,  and six other reputable individuals from the six geo-political zones in the country, three of whom will be women.

The mandate of the Board shall be to oversee the Fund in the petroleum subsidy savings account, and the programme specifically to improve the quality of life of Nigerians in line with the Transformation agenda of Mr. President. The Board will have the following responsibilities:

(a)  Determine in liaison with the Ministry of Finance and Ministry of Petroleum Resources, the subsidy savings estimates for each preceding month and ensure that such funds are transferred to the Funds’ Special Account with the Central Bank of Nigeria

(b) Approve the annual work plans and cash budgets of the various Project Implementation Units (PIUs) within the Ministries, Departments and Agencies (MDAs) and ensure orderly disbursement of funds by the PIUs in order to certify and execute projects;

(c)  Monitor and evaluate execution of the funded projects, including periodic Poverty and Social Impact Analyses (PSIA)

(d) Update the President regularly on the programme;

(e)  Periodically brief the Executive Council of the Federation on the progress of the programme;

(f)    Appoint consulting firms with international reputation to provide technical assistance to the Board in financial and project management;

(g)  Appoint external auditors for the fund;

(h) Do such other things as are necessary or incidental to the objective of the Fund or as may be assigned by the Federal Government;

Members of the committee to meet with organized labour, civil society groups and other stakeholders are: the Chairman of the Governors’ Forum, Governor Rotimi Amaechi of Rivers State, Governor Babangida Aliyu of Niger State, Governor Peter Obi of  Anambra State, Governor Adams Oshiomhole of Edo State and Governor Sule Lamido of  Jigawa State.

The Committee which is expected to begin its work immediately also includes the Minister of Finance and Coordinating Minister of the Economy, Mrs. Ngozi Okonjo-Iweala, the Minister of Petroleum Resources, Mrs. Diezani Allison-Madueke, the Minister of Labour and Productivity, Chief Emeka Wogu, the Special Adviser to the President on Inter Party Affairs, Senator Ben Obi and Mrs. Ngozi Olajemi.


Reuben Abati, Ph.D.  Special Adviser to the President

(Media and Publicity), January 2, 2012



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