A Review of the Nigerian Energy Industry

No time frame yet for removal of fuel subsidy – Alison-Madueke

26 October 2011, Sweetcrude, Perth, Australia – Campaigners against fuel subsidy removal in Nigeria may have gained some ground, with the government shifting the January implementation date.
Petroleum Minister Diezani Alison-Madueke said Tuesday that the subsidy would not go, until due consultations have been held with all Nigerians.

“We are still in the discussions with labour and other stakeholders. Until that is finished, I don’t think it is right to give any definite date for the roll-out of the implementation of subsidy removal. We are still in discussion with major stakeholders, including the National Assembly,” she said.

Mrs Alison-Madueke spoke in Perth, Australia. She is on President Goodluck Jonathan’s delegation to the Commonwealth Heads of State and Government Meeting (CHOGM) holding in that country.

The government, in its budget framework for 2012-2015 sent to the National Assembly, hinted of its intention to remove petroleum subsidy as from January.

The government claims that subsidy – of about N1.2 trillion, according to its officials – has benefited only a few individuals to the detriment of the generality of Nigerians for whom it is meant. It promised to plough back the cash saved from subsidy withdrawal to provision of infrastructure.

The minister also said the government has raised a team of eminent Nigerians to advise it on spending the cash.

The team will also manage the cash realised from the subsidy to ensure transparency and performance.

Though she declined to give the names of members of the panel, Mrs Alison-Madueke said the list is already before the President for approval.

The minister explained that the government opted for the removal of subsidy because all efforts made to curtail racketeering failed to yield the desired result.
She said President Jonathan insists that the people must get the full benefit from subsidy removal.

Her words: “It has become pertinent that we find other ways to utilise the vast resources that are been channeled into the subsidy which are not reaching the masses. This time around, once we reach an agreement with the various stakeholders and agree on a formula, major benefits will be put on the table.

“Government will not handle the implementation of these benefits, so that it will be open and transparent. As we speak, a committee of highly-respected Nigerians is being put together, who will monitor and advise government.

“There are major benefits that will cut across all major sectors of the economy. Some of them involve road works, major public maintenance work, and the ongoing mass transportation. There are schemes for skilled youths and also schemes for unskilled youth and of course there will be areas for maternity and child cares. But we shall ensure that across the board, the package is robust and monitored.

“In the area of public works, we shall not go through the government channels, as usual. A Special Purpose Vehicle (SPV) will be set up specifically to handle it so that we don’t get bogged down in the usual manner of process and procurement issues. We shall mobilise upfront, because deregulation subsidies are paid monthly and we cannot wait monthly to collect money. The money will be borrowed upfront from the Central Bank of Nigeria (CBN) and mobilisation will start immediately so that it will be clear that we intend to put our money where our mouth is this time around.

“Mr. President is adamant that if we remove subsidy, we must give Nigerians the full benefits and the full impact of that removal.”

She noted that the issue of cash from subsidy removal not reaching the people has been of great concern to the government.

The minister, who also spoke on the Petroleum Industry Bill (PIB), said at the moment the situation is not in the hand of the executive as the bill is still before the National Assembly, adding that “It becomes almost illegal for the executive to officially write on the matter to the NASS.”

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  • Dis tins are not just happening. All govt iiotitutnsns in Nigeria have over the years developed a culture of disregard & disrespect for the average citizen.It shows in the way an ordinary police recruit addresses you on the street, the military personnel also address you with belts & horse whips, while the civil servant/politician treats you with scorn once they have determined that you have nothing to offer them!Really sad case of being a Nigerian!!