• Fuel scarcity persists despite price hike
• Naira may exchange for N283 to dollar
Three days to the threatened mass action against government’s increase in the price of petrol, indications emerged yesterday that the Federal Government would meet organised labour today in Abuja over the issue, dangling a carrot before labour leaders.
The Guardian learnt that at the meeting slated for 3:00 p.m. at the Federal Ministry of Labour and Employment, the Federal Government will be coming to the parley with the proposal for a new minimum wage that is fixed at N45, 000.But the increase comes with some provisos including reduction in the number of civil servants and merging ministries and agencies.
Indeed, the President of the Nigeria Labour Congress (NLC), Ayuba Wabba confirmed the scheduled meeting saying he got a text message inviting him and other labour leaders to the meeting.
A source in the Presidency told The Guardian that ministers had been told to lead the initiative on the downsizing.Also, the Efficiency Unit in the Federal Ministry of Finance, which is saddled with coming up with cost reduction strategies is working on the template for the reduction.
The Federal Government would also be relying on the report of the Steve Oronsaiye’s panel on the rationalisation of the civil service in the streamlining process.
It was also learnt that though government said it would not devalue the naira, it would indeed embark on what it termed ‘appropriate’ value of the national currency, which may be in the region of N283 to the dollar.
Meanwhile, fuel scarcity persisted in most of the major cities of the country yesterday despite hopes that petrol would be available since government at the last Federal Executive Council meeting raised the pump price of petrol to N145 per litre.Yet, some outlets are retailing for as high as between N150 and N175 per litre.
A visit to some areas in Lagos showed that most petrol stations were under lock and key, with only one or two selling the product for N145 per litre.
In a related development, the Arewa Defence League (ADL) has called on Nigerians to stand by the current administration over the recent increase in pump price of petrol, saying the increase is not meant to worsen the sufferings of the masses but aimed at ensuring availability and sustainability of the product.
But the NLC President, Ayuba Wabba, berated the government that promised to create jobs but was now tinkering with the idea of embarking on one of the most massive job losses Nigeria has every witnessed.
He added: “We cannot be talking about creating jobs and at the same time be talking about mass sacking of workers. This is a government that promised jobs and now, it wants to embark on mass sacking of workers. It is difficult to reconcile the two extreme ends. We will not accept any proposal for job cuts if put across to us.”
Wabba pointed out that the challenge of retrenching workers has always been that government at all levels has failed to make provision for payment of entitlements.
He explained: “Well, every employment has terms of agreement. Nobody can force any worker on an employer and no employer can insist a worker works for him. But very importantly is the fact that exit strategies must be in place for painless exit. The problem over the years has been that government disengages people without preparing for the payment of their gratuities and pension. I believe there are many employees that will be happy to leave today if all their entitlements are ready.”
While hinting that while the labour centre and their civil society allies are ready to come to the negotiation table, he explained that the issue at stake is far more germane than price increase.
He said: “I must say that the issues are beyond the price increase and dollar exchange rate. The issues are about the totality of the corruption that has characterised the downstream sector for many decades. Simply pegging the exchange at some N285 or so will not address the problem. It is a simple matter that if the demand outstrips the supply end, the price of the dollar will increase and Nigerians will continually pay for petrol. So, there would be no to price increments if the fundamentals are not discussed.”
Wabba said while labour is open-minded about all the issues, it will push for solving the challenges with timelines that would be respected.
“Just increasing the price is taking the easy way out. This is because, as the President and Dr. Kachikwu have observed in the past, what has held the downstream sector down is corruption especially as it concerns the landing costs. What government is trying to do now is transferring the burden to the Nigerian people. What government needs to do is to find the right mix to put an end to the quagmire.”
Long queues have remained at filling stations, including at the popular NNPC mega stations which offered Nigerians some respite before the increase.Black marketers were also in active business, with some selling at N350 per litre.
Besides, with the upward review of the Price of Premium Motor Spirit (PMS), otherwise known as petrol from N86.50 to maximum of N145 per litre (about $0.73), the cost of petrol in Nigeria is about the lowest in Africa and among some oil producing countries.
Data obtained from GlobalPetrolPrices, which was updated at the weekend, showed petrol in Chad costs $0.78 per litre; Togo, $0.80 per litre; Kenya, $0.81 per litre; South Africa, $0.84 a litre; $0.85 a litre; Niger, $0,90; Ghana, $0.92; Sierra Leone, $0.94; Uganda, $0.97 and Angola, $1.00 per litre.
Also, in Rwanda, Mali, Malawi, Guinea, a litre of petrol sells for $1.15, $1.15; $1.17; $1.17 respectively, which are far higher than the price in Nigeria.
Long queues have remained at filling stations, particularly at the popular NNPC mega stations which offered Nigerians some respite before the increase.Black marketers were also in active business, with some selling at N350 per litre.
Attendants at one of the filling stations along Oshodi -Apapa Expressway, Lagos told The Guardian yesterday the retail station had already run out of the commodity before the announcement of the new price regime.
Experts believed that the recent hike in the price of fuel would lead to hardship and have therefore urged government to initiate measures to ameliorate the effects on the economy.
A Head of the Department of Petroleum Engineering and the Deputy Director, Centre for Petroleum, Energy Economics & Law. Dr. Olugbenga Falode, told The Guardian that this is because whatever happens in the oil sector affects all other sectors of the economy and by implication, it affects the macro-economic policies of the country.
Also, a Professor of Technology Management, Obafemi Awolowo University, Ile-Ife, Francis Eniterai Ogbimi, said that mere adoption of deregulation and privatisation cannot build refineries and increase refining crude petroleum. Increased production is the solution to low supply, not the adoption of ideologies like capitalism deregulation, privatisation, liberalisation, socialism or communism, he said.
According to him, only seven per cent of the nations in the world practise full deregulation of the sale of petrol, adding that the United States does not practise full deregulation as the American government controls the price of petrol.