On the day he was inaugurated, President Bola Tinubu proudly declared that “Fuel subsidy is gone.” Following this announcement, Nigerian stocks rose to a two-month high. The capitalist class celebrated the beginning of what would turn out to be an aggressive renewal of the neoliberal onslaught against the poor working people in Nigeria.
During the 2023 presidential elections, the flag bearers of all the mainstream parties were united in their claim that removing fuel subsidy would be for the good of the country.
The 2023 presidential candidate of the Labour Party, Peter Obi called fuel subsidy a form of “organised crime” and said on live television that he would remove it “immediately” if elected president. Other major opposition figures in the capitalist class such as the 2023 Presidential flag bearer of the NNPP, Rabiu Musa Kwankwaso, and former vice-president and perennial presidential candidate, Atiku Abubakar also described fuel subsidies in similarly disastrous terms.
President Bola Tinubu on his part has continued to pay lip service to welfare programmes he is hardly funding to any meaningful degree, or at all.
In a televised address last year, the president said, “For several years, I have consistently maintained the position that the fuel subsidy had to go. This once beneficial measure had outlived its usefulness. The subsidy cost us trillions of Naira yearly.
“Such a vast sum of money would have been better spent on public transportation, healthcare, schools, housing, and even national security. Instead, it was being funnelled into the deep pockets and lavish bank accounts of a select group of individuals.”
Subsidy removal is unique in that even its proponents have long acknowledged that it would bring its ‘pains.’ So they argue it would free up money for social spending as a false sweetener for these pains. Mainstream media outlets played a very crucial role in promoting these talking points. Even certain sectors of the civil society movement have completely capitulated to this narrative. But more than a year later, the policy has proved disastrous and is projected to raise the poverty rate by around 4%. In contrast, Nigerian banks declared record profits. And Oando, run by the Presidents’s billionaire nephew, Wale Tinubu, has seen it’s market value go from N70 billion in 2023 to N1 trillion as of September 2024.
In November, the federal government announced that it had saved N1.45 Trillion from only a few months of ending subsidy payments. That was a huge windfall. But far from his promises to use this money to invest in education, healthcare and infrastructure, the Tinubu administration has spent lavishly on luxuries and frivolities.
In the supplemental budget passed by the National Assembly last November, President Tinubu and his deputy, Kashim Shettima, allocated to themselves N12 billion to renovate their offices. The first lady, Remi Tinubu also received an allocation of N1.5 billion to purchase official vehicles. Earlier this week, it was reported in the Punch that the First Lady’s office spent N701 million naira on foreign trips in three months. President Tinubu himself spends extended periods abroad for health and other reasons, on the country’s dime. All the while, we the poor masses are pushed to the point of famine.
Another promise that was used to market fuel subsidy removal to Nigerians was the claim that fuel queues would become a thing of the past. The scarcity, we were told, only existed because subsidised crude products were being smuggled across the border and sold at market price. Once government removed this incentive for smuggling, they told us, fuel queues would disappear. We all know that this has not materialised. If anything, the scarcities have become more frequent, as marketers take advantage of the price hikes to hoard, only to resell to black market retailers.
In August, there were nationwide protests demanding that the government reinstate the subsidies. State security forces violently repressed the protests. Dozens were killed, thousands arrested and several charged with treason, a crime punishable by the death sentence in Nigeria.
Even the promise that the Port Harcourt refinery would become operational again has been repeated so many times that the good faith of the people making these promises is in serious doubt. The NNPCL CEO, Mele Kyari, and President Tinubu, who is also the minister of petroleum had promised that the Port Harcourt refinery would start producing petrol by August 2024 but that timeline is now in the past but , the refineries are still not operational. The government has practically ceded the local refining of crude to the Dangote Group.
The foray of the Dangote group into the oil sector was another empty promise that failed to materialise any tangible benefits for the Nigerian people.
The completion of the Dangote recovery, and its commencement of production, was supposed to crash the local price of PMS. Yet, the pump price is between N950 per litre and N1020 per litre at NNPCL filling stations across the country.
During minimum wage negotiations earlier this year, the president committed not to further raise the pump price. It was around N700 per litrer at that time.
And while Nigerians were urged to celebrate the Dangote refinery as a solution that would save the government significant sums in foreign exchange, after a lot of back and forth of accussations between state regulators and the chairman of the Dangote group, Aliko Dangote, the NNPCL has announced that it would be buying Dangote refinery’s PMS with USD.
Subsidy removal has delivered none of the benefits it promised. It has not even eased the pressure on Nigeria’s foreign reserves. Instead, it has primed the economy for more neoliberalisation, whether subsidy is really gone or not. The Nigerian state is overseeing a transfer of major sectors of the economy to private ownership.
The removal of fuel subsidy is only one point of deregulation. The NNPCL itself has been reorganised to prepare for full privatisation and commercialisation of the petroleum industry.
In general, the Nigerian economy is being put through shock therapy, championed by IMF and World Bank policy advisers. Subsidies and price controls on everything from electricity to tuition fees have been scaled back by the federal and state governments. And this scaling back has negatively impacted working-class people who are expected to suffer the depreciation in their standard of living with patience and fortitude, while the rich get richer.
The Tinubu regime has shown that it will stop at nothing to keep its policies, which are disastrous for the Nigerian masses, in place. The government has repeatedly resorted to repressive measures precisely because these policies, having finally been put to the test, have been soundly rejected by the Nigerian people. But these measures cannot save it from the judgment of history or the anger of working-class people and youths today. The struggle continues until victory is won.
by Kayode Somtochukwu ANI
