TELL Magazine

Self-praise is the luxurious indulgence of the indolent and the vain. The ninth National Assembly has consistently displayed its indolence and vanity in large measure. Probably because it lacks self-awareness of its very low esteem among the public, it has awarded itself the distinction of being the best National Assembly since the inception of the current democratic dispensation.

The basis of this dubious claim is that it has passed many landmark legislations, including the Petroleum Industry Act, which is already being gutted even before it comes into full force. It’s earlier slated to take effect from last January. But paying obeisance to the primacy of subsidy in the national budget’s spending outlays, President Muhammadu Buhari unilaterally shifted the full implementation date to July. And not a whimper came from the National Assembly over the president’s whimsical decision to implement the act as he pleases.

Lawan and Gbajabiamila take immense pride in their uncritical co-operative relationship with the executive, and reflect the servile attitude of most of their colleagues. Click To Tweet

Senate president, Ahmad lawan, and House of Representatives speaker, Femi Gbajabiamila, two unapologetically sorry lackeys of the presidency, had vowed that they would get the National Assembly to do whatever the president requested for. That was three years ago. Since then, the federal legislature has mostly lived up to that promise.

Lawan and Gbajabiamila take immense pride in their uncritical co-operative relationship with the executive, and reflect the servile attitude of most of their colleagues. Loyalty to the president and their party is more important to them than diligently serving the people they represent.

Among other acts of betrayal of the people and the subordination of the national interest, they have enabled the executive to borrow money from wherever it can get it, thereby putting the country in a state of financial stupor. The rationale for the endless borrowing is never thoroughly interrogated. And the ‘legisleepers’, as someone derisively called them, don’t ever ask for accountability for the previous borrowings before they approve new requests from the executive.

They were their typical supine selves last week when they approved the N4 trillion the executive had requested for petrol subsidy payment for this year alone. No questions asked. Whatever the president wants from them, he gets.

The provision in the 2022 federal budget for subsidy payment was ₦440 billion. This was to last till July when the subsidy would end. But when the Nigeria Labour Congress, NLC, and other labour groups threatened a showdown with the government over its plan to discard with the subsidy regime, the executive beat a hasty retreat. It announced that the financial insanity called fuel subsidy would continue.

While outright removal of subsidy will spike more inflation and cause more pains for the people in the short term, clinging to a policy that doesn’t make any sense will continue to damage the economy. And the consequences will be felt for… Click To Tweet

Labour and all those reaping immense benefits from the financial vandalism that subsidy represents won another victory. Having virtually lost all its moral authority because of its unpopularity, the government couldn’t summon any will to even make a case for some modest increase in the pump price of petrol. This would have helped to reduce the humongous budgetary outlay for subsidy. And significantly shrink the government’s borrowing.

Weakened by its own all-round failure and unable to face the wrath of the public over fuel subsidy removal, the government asked the National Assembly to bail it out of its dilemma. It requested for an increase of the subsidy provision in the budget from ₦440 billion to ₦3 trillion. This was subsequently approved.

When the government realized two weeks ago that, with the continuous rise in crude oil prices, the ₦3 trillion would not cover subsidy payment for the year, it went back to the National Assembly for an additional ₦1 trillion. Again, the approval was given without any query of NNPC’s outlandish and highly improbable claim of a daily fuel consumption of 100 million liters plus. Whatever the president wants, he gets.

As the Russia-Ukraine conflict continues to create tighter global oil supply, crude prices will inevitably keep rising. That means the cost of fuel imports will also continue to rise. And with it, fuel subsidy payment obligation. So no one should be surprised when another request for more increase in funding subsidy goes to the National Assembly. And we all know what the outcome would be.

The rationale for the endless borrowing is never thoroughly interrogated ( by the legislators). Click To Tweet

Following the latest subsidy give-away by the National Assembly, a simple but very cogent analysis of the ₦4 trillion started trending on the social media. It drew attention to the sheer absurdity of wasting so much money on just one item of expenditure – fuel subsidy.

According to the analysis, the ₦4 trillion is about $9.6 billion. I haven’t done the maths. So I can’t vouch for the correctness of the dollar equivalent. But there has been no rebuttal of any kind from either the Ministry of Finance, Budget and National Planning or the Central Bank of Nigeria.

The analysis points out one irrefutable and highly embarrassing fact. Which is that the cost of the 650,000-barrel-capacity Dangote refinery is $10 billion (₦4.1 trillion). It adds: “The National Assembly today approved Buhari’s request to spend in JUST ONE YEAR 96% of the actual cost Dangote is using to build his refinery in Lagos.”

It concludes that, “this implies that Nigeria can build one Dangote refinery every year”, if the government could summon the courage to slay the subsidy dragon.

The reality of how subsidy has been a huge drain on the public finances and the incalculable damages it has done to the economy, as starkly illustrated by the Dangote refinery, ought to concentrate the minds of the over-paid bunch of loonies in the National Assembly. But given their poor understanding of the economics of subsidy and their willful indifference to the corruption that underlines it, nothing would move them to do right by the country and the people.

Their heads are buried in the sands with their feet up in the clouds, completely oblivious of the economic ravages of subsidy. Doing what the president wants is more important to most of them than sanitizing the vast distortions in the government’s priorities, budgeting processes and weaning it off its addiction to borrowing to pay even salaries.

Even more risible is the president’s stance on subsidy. It has evolved from pretentious scepticism to open acceptance of the primacy of subsidy in Nigeria’s economic policy.

Presidential candidate Buhari had dismissed fuel subsidy as a fraud before the 2015 general elections. It’s an effective and emotionally charged campaign soundbite. Coming from him, as a former petroleum minister in the General Olusegun Obasanjo military regime (February 1975 – October 1979), it was difficult proving the falsehood of his claim. The public genuinely believed that he knew what he was talking about.

Once he was elected, he seamlessly transfigured to the chief advocate of subsidy. He wants to be seen as being on the side of the people while ignoring the sound economic and financial arguments against the policy.

While outright removal of subsidy will spike more inflation and cause more pains for the people in the short term, clinging to a policy that doesn’t make any sense will continue to damage the economy. And the consequences will be felt for years. One of which is a heavy debt burden the country may be unable to service.

What makes sense is a phased removal of subsidy within a year. And the plan for it should be considered an urgent necessity. But who will get the executive to admit the sheer folly of its refusal to confront the subsidy quagmire by initiating such a plan? Certainly not the National Assembly that’s best positioned and has the constitutional power to pressure the government to do the right thing.

Most of the members are loonies and reflect the abysmally poor representation the people have. Nigeria’s cataleptic embrace of a policy that impoverishes it is a classic definition of insanity. And there seems to be no immediate end to this lunacy.

Email: nosaigiebor@tell.ng

Phone: 0807 629 0485 (WhatsApp messg. and SMS only).

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