Nigerian's were told yesterday to brace up for deregulation – the government’s answer to the ailments of the downstream sector of the oil industry. The controversial policy is inevitable, senior government officials told Labour, pleading for understanding.
Labour is against the policy, which it says will further impoverish the masses, and has vowed to call workers out on strike when it is introduced.
Four ministers – Dr Rilwan Lukman (Petroleum Resources), Prince Adetokunbo Kayode (Labour and Productivity), Mansur Muktar (Finance) and Odein Ajumogobia (State for Petroleum) – as well as Group Managing Director, Nigerian National Petroleum Corporation (NNPC) Mohammed Barkindo represented the government at a meeting with Labour in Abuja yesterday.
Nigeria Labour Congress (NLC) was led by its National President, Comrade Abdulwaheed Omar, his Deputies, Peter Adeyemi and Promise Adewusi, General Secretary, John Odah and other members of the Central Working Committee (CWC).
Lukman said the government had made up its mind on the issue, adding: "Deregulation is ultimately inevitable, if we want to go forward as a nation."
He added: "I want labour to appreciate the fact that it is not intended to target the people or impoverish our citizens. The whole aim of the government is to make life better for our citizens. If we want that, we cannot go ahead and come up with a policy that will make life difficult for our people. It doesn’t make sense at all.
"It is not possible to change things in five minutes; there is no intention to impoverish the citizens of this country through deregulation."
Lukman urged organised labour and civil society groups to partner with the government to solve the fundamental problems in the sector instead of kicking against deregulation.
Besides, he said the government could no longer afford the huge subsidy on fuel even when the targeted beneficiaries are not enjoying it.
Muktar said the government was working hard to address the demands of labour, by looking at transportation, road, power supply and others.
He said what should concern all now is how to strengthen the government’s capacity, ensure that budgets are implemented and projects are effectively executed.
He said the National Assembly had been so critical of budget implementation, and this kept the executive on its toes.
Muktar said: "More than 18 licences were issued but were revoked because nothing has been done. The President asked us to find solutions to the problems in the sector, a committee was set up, headed by Bauchi State Governor Isa Yuguda, and it worked with the National Economic Management Team.
"We understand the concerns of labour – possible fuel price increase, palliatives and the Petroleum Trust Fund (PTF). We don’t have answers to all the problems, but what we are saying is that subsidy is not sustainable at the rate we are going.
"Mr. President is working hard on existing railway system; he has to channel a lot of funds to road maintenance and other capital projects. Mr. President has leadership qualities, has commitment to the people and needs labour’s support in this issue.
"Many cars are broken down because of adulterated fuel; people are taking advantage of this situation to exploit the people, so it has to be addressed.
It was learnt that the labour leaders restated their opposition to deregulation insisting that it cannot be carried out in the present circumstance.
A source said: "The NLC leadership impressed it on the Federal Government’s team that they cannot deregulate in an economy that is import-driven. But the ministers kept insisting on deregulation, based on their previous reasons. The questions that the leadership of the union raised were not answered; they only kept insisting on deregulation."
The meeting continues today.
The United States (US) yesterday spoke on the planned deregulation of the downstream oil sector, saying that the policy must be pro-poor.
It said the tackling of corruption was critical to the policy’s success.
The coordinator, State Department for International Energy Affairs, David Goldwyn, told reporters at the US-Embassy in Abuja, said though deregulation is vital to economic growth, government should also consider subsidy of electricity.
Goldwyn said in a situation where only about five percent of the population use automobiles, deregulation might be counterproductive if it is not pro-poor.
Goldwyn stressed the need for reform in the energy sector, pointing out that good governance was necessary in coordinating investment in the sector.
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