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Obasanjo and fuel prices
By Felix Akpan
WHEN President Olusegun Obasanjo was re-elected in 2003, the news of his 'landslide victory' to borrow a phrase from the Nigerian popular media, was received with mixed feelings particularly, given his performance in his first term in office. Against this backdrop, it is easy to understand why we are not surprised with the President's policy, mind-set and attitude towards the people who elected him. As psychology teaches us, it is not easy to change deep-seated attitudes, age-old habits and entrenched behaviour. The point being made is that, Obasanjo as Head of State in 1976 is the same President Obasanjo in 2004.
Little wonders then, that the Obasanjo administration is doing more and more of the same old policies that achieved limited impact in 1976. And there is no discernable change of strategies and methodology in programme implementation. You might have forgotten the story of Obasanjo's stewardship in 1976 but it is worth re-telling because of its ironic significance to the current discussion.
Between 1976 and 1979, when Obasanjo was Head of State, he initiated the process of socio-economic reforms in its present form. Two examples are worth recalling here. The first was, his educational policy, which led to the famous 'Ali Must Go' saga. This was the genesis of the decline in our educational system at all levels. President Obasanjo talks about education each time he is given the opportunity to rule, but does nothing about it except, sacking and throwing lecturers' out of their official residence in 1978 and sacking and owing them four months salaries in 2003. Similarly, the same man talks about providing Nigerian workers with living wages but turns around and put labour leaders in jail for performing their civil responsibility of using strike as a weapon against bad governance.
In 2004, labour leaders have suffered worse things in the hands of the same man. Ask Adam Oshiomhole, the NLC President, about the labour bill and he would tell you about the coup against the Nigerian workers because the NLC belongs to Nigerian workers and not Oshiomhole, as those who covet to destroy the NLC thinks. The second example is the politics of increase in fuel prices. Obasanjo started it in 1976, but it has now become his own monster as the recently suspended mass action has shown. It is instructive to note that the civil society and organised labour groups are now ready to address the fuel problems of this country using every constitutional means. The suspended mass action gives us a clue on this matter.
In reality, the increases in the prices of petroleum products over the years have become a huge burden on Nigerians. Whenever the prices of petroleum products are increased, the cost of goods and services go up. It is also important to note that all the previous governments have never concretised the various reasons they gave for the increase in the prices of petroleum products.
For instance, early this year, President Obasanjo said that the introduction of petroleum tax was necessary because the government needed extra money to improve our social infrastructures and services. We believed him. But what is the result today? Our social infrastructures and services are worse off today than before the President made that pronouncement. Thus, it is not that Nigerians do not want to make sacrifices for their motherland, but sacrifices without results is what they strongly demur.
Undoubtedly, no Nigerian would complain if he is asked to buy fuel at N100 per litre, provided he is paid living wages; the roads are motorable; electricity supply is constant and the prices of goods and services are affordable. They are even ready to pay more, if the government takes the fight against corruption seriously and stops deceiving itself. If the government provides unemployment benefits, equip our consulting centres (read hospitals). This is what good governments do all over the world and their citizens pay all kinds of taxes without grievance.
But in a situation like ours, where the government does not provide any of the aforementioned services and inflation rate is well above Soludo's NEEDS target, the people have a right to ask questions or protest against policy/tax that does not add value to their lives. In fact, they will go to war, if they know, as we do, those who are importing fuel into the country and making enormous profit at the detriment of the Nigerian people.
Meanwhile, the government has not told us, what has happened to the windfall from the world oil prices, when crude oil price went up as high as $52 per barrel some weeks back? When it was $41 per barrel in May 2004, Ngozi Okonjo-Iweala, Minister of Finance, said that the federal government had saved up to N108 billion in excess accounts kept at the CBN. What has the government done or intends to do with this windfall?
The truth of the matter is that politics in Nigeria cannot be divorced from oil. National and personal dreams, hopes and aspirations are built around oil. No doubt the intensity with which the local elite struggles for power is, in part, evidence of our failure to divorce politics from oil. Our leaders think oil. Dream oil and act oil. The inability of our leaders to think beyond oil is the foremost problem of this country.
It is in connection with the above point that, the President had to negotiate with Asari Dokubo, the leader of the Niger Delta Voluntary Force, when he threatened to blow up oil wells in the Niger Delta region. It is also in connection with the same point that, all other viable sources of revenue are either neglected or underdeveloped. This explains, in part, why each time the government needs extra money, the first thing that comes to mind, is oil. This also explains why the country has been wrongly branded a mono-cultural economy, whereas mother nature has been very charitable to us in terms of human and natural resources.
Given this scenario, it should be easy to understand, why the present government has increased fuel prices three times in one year. Why marketers decide how much they would sell our fuels to us (who are these marketers?) Why we cannot build new refineries or repair the old ones. Why we deregulate our oil industry without putting in place all the structures of deregulation. Why the government cannot review the royalties and petroleum taxes oil companies' pay upward, each time it needs money to do whatever it likes. Why those who are benefiting from the system and are least likely publicly to criticise the government are the majority in the committee set up by the President to look into the fuel matter.
Indeed, except our leaders begin to think beyond oil or break from the oil trajectory and the path of narrow, greedy, selfish and clannish interests, incessant increases in the prices of petroleum products might become their albatross. There are many countries in the world today that do not have oil but they are doing far better than us on the human development index. According to the Human Development Report, Nigeria ranks 40th from the rear in its human development index, with countries like Mauritius, Egypt, Congo, Namibia, etc, ranked better than Nigeria. Why is the country's human resources development index so low and why is there a wide gap between government spending and social service delivery? The answer to these questions is simply corruption.
It is not as if, the government is not generating enough revenue from oil and other sources or that Nigerians are under taxed, the problem is that over 60 per cent of our national revenue, to be conservative, is being pilfered by government officials at all levels. Thus, if you like selling fuel at N500 per litre, there would still not be enough money for social service delivery, because official rats would steal more than 50 per cent of that money. For that reason, except the President has the moral and political will to fight corruption, it will be business as usual.
At the current crude oil prices in the international market, the government is not supposed to increase fuel prices. All it needs do is to ensure that official rats do not steal from the windfall. The point being made is that official corruption takes a lion's share of our national revenue. Going by the national budget, every sector of our national life-education, roads, electricity, health, etc, to a large extent, is well funded. But at the end of every budgeted year, there are no corresponding improvements in these sectors because of official corruption. Every government official today is a contractor and/or consultant by proxy. Even the Torontos amongst them are consultants on a wide range of issues such as deregulation of the country's economy. Thus, the problem is not with the tax regime but with corruption. Mr. President, so turn your attention to corruption. As Commander-in-Chief, you must lead this battle yourself. Think corruption, dream corruption and fight corruption. There is no better legacy you can leave behind than putting some of your corrupt officials in jail.
- Dr Akpan teaches political science at the University of Calabar, Calabar.
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