Ijeoma Nwogwugwu: The Kerosene subsidy scandal

by Ijeoma Nwogwugwu


I have often argued that the hue and cry over the retention of the subsidy on petrol is one that is managed and controlled by the elite. They, not the so-called masses that the civil society groups and labour unions claim to represent, stand to lose the most when the price of petrol is tampered with.

Kerosene, one of several petroleum products imported into this country, is used predominantly as an energy fuel by the less affluent of our society. Other sectors where it is used in reasonable quantities include the aviation sector as unleaded kerosene, better known as jet fuel, or by pharmaceuticals and downstream oil and gas companies that manufacture pesticides.

It is for this reason when the House of Representatives Committee Chairman on Petroleum (Downstream) Dakuku Peterside criticised the federal government and Nigerian National Petroleum Corporation (NNPC) for frittering away N634 billion on subsidy for kerosene, it hardly got a front mention on any of the front pages of the national newspapers.

If it were petrol, not only would it have been accorded space on the front pages, the headlines would have been sensational. By today, if it were petrol, civil society groups, so-called human rights/civil society lawyers and commentators, Nigeria Labour Congress and the Trade Union Congress, in tow, would have condemned, in no uncertain terms, the subsidy scam on petrol. They would have been baying for blood and called for a probe to investigate why the federal government has turned a blind eye to a cartel that in three years has stolen the equivalent of one-third of the capital budget in one fiscal year on. Rallies and threats of strikes would have been issued by these groups to register their displeasure with the federal government’s mismanagement of the subsidy on petrol.

But since the subsidy scam that is being perpetuated by NNPC is on kerosene, no one cares. Relative to petrol, kerosene is consumed in infinitesimal quantities by the elite. It is a commodity used mainly by the lower strata of the society in urban and rural areas. For six years, the price of kerosene has been pegged at N50 per litre so that it can be made available to the poor at a cheap, controlled price. Yet not a single household that uses kerosene to cook or light their lamps is able to buy it at N50 per litre. Kerosene, instead, retails at both the fuel stations and other outlets at a minimum of N120 per litre.

I have often argued that the hue and cry over the retention of the subsidy on petrol is one that is managed and controlled by the elite. They, not the so-called masses that the civil society groups and labour unions claim to represent, stand to lose the most when the price of petrol is tampered with. It is their pockets that it hits the most, not the masses. It is the elite that has the capacity to call for strikes and shutdown government. It is the elite that has the capacity to organise rallies, give long-winded speeches and get the media to write self-serving editorials and commentaries on the mismanagement of the subsidy scheme on petrol. But the same elite and media turn a blind eye to the masses who more often than not, are forced to queue for kerosene and fork out more than double the retail price for the commodity, if and when it is available. Note the hypocrisy of the civil society groups, human rights lawyers, labour unions and the media herein.

It should also be noted that this scam that we have ignored to the detriment of the masses has cost this nation dearly. In three years of turning a blind eye to the kerosene subsidy scam, NNPC has become the sole importer of the commodity and uses it to dispense favours. Not even the Petroleum Products Pricing Regulatory Agency (PPPRA), which is statutorily bound as the industry regulator, to issue import allocations for petroleum products dares challenge the monopoly that NNPC has become as the sole importer and distributor of kerosene. With its hegemony, NNPC has created overnight multimillionaires and billionaires through the allocation of kerosene to friends and cronies of the administration. In fact, let no one be surprised if labour leaders, among others, have not been beneficiaries of the kerosene subsidy scam.

As Peterside said last week, no country that spends most of its resources on consumption and entrenches a regime through which billions are looted year in, year out, can develop. “How can we progress when our funds are being used to service corruption?” he demanded to know. Despite this, he added, we complain that there are no good roads, no good schools, lecturers are on strike, there is inadequate healthcare, and we would rather spend meagre resources on procuring bulletproof vehicles.

We ascribe our problems to demons, he said. In other words, we even fail to take responsibility for our own acts of commission or omission in the mismanagement of the economy. But for how long will the charade and lies continue? Have labour, civil and human rights groups, and the media no conscience?

For over a decade I have agonised over the untold damage misdirected and misapplied subsidies on petroleum products have had on the economy. I have lost sleep over the amount of money that has ended up in private pockets, not the masses, through the subsidy scheme. For years, I have advocated and heckled the National Assembly into passing a comprehensive legislation on an anti-trust and competition law. I have often asked why the inadequacy of kerosene is not given as much attention as petrol. The simple answer is nobody cares.

So even though I am on the same page as Peterside and agree that the wholesale corruption in the distribution and marketing of kerosene must be stopped. I also agree with him that the switch from kerosene consumption to liquefied petroleum gas (LPG) consumption, as a cleaner, safer fuel, would put us in better stead, as long as it is readily available. However, as a legislator, he like the elite, labour unions and media, is partly to blame for playing to gallery.

He, as a legislator, responsible for the oversight of the downstream oil and gas sector and is meant to ensure that the laws passed by parliament are enforced, has turned a blind eye to the emasculation of PPPRA by NNPC and the Ministry of Petroleum Resources. He, as a legislator, lacks the political will and courage to take on the cartel, starting from government officials, who have stolen from the impoverished masses. He has failed in his capacity as a legislator to resuscitate the anti-trust and competition bill, which has been buried in the legislature for a decade. And in his failings as a legislator, Peterside, like the rest of us, does not really care.


Read this article in the Thisday Newspapers

Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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