Lawan counters Finance Minister: Buhari never ordered fuel subsidy removal

Senate President Ahmad Lawan

President Muhammadu Buhari has not directed government officials to remove fuel subsidy, Senate President Ahmad Lawan has declared.

His position runs counter to that of Minister of Finance, Budget and National Planning Zainab Ahmed, who at a recent media parley said oil subsidy will cease June 2023.

Minister’s position

The minister had predicated her position on the Petroleum Industry Act (PIA) which sets out stages of regulating the sector for efficiency.   

Already, the prices of diesel and kerosene, among others have long been deregulated.

“From July to December, there is no provision made for subsidy. Our assumption is that by June, we would have been able to work through a process with all stakeholders, NOC, oil regulators, different MDAs that have a role to play as well as businesses. The PIA has made a provision that prices of products in the petroleum sector must be deregulated. And so far, we have been able to deregulate kerosene prices, diesel prices, the only one that is still not deregulated is PMS. We are trying to comply with the law because the PIA is an Act of the NASS and government has a responsibility to comply.

“And so, what do we do in terms of providing succour to mitigate the impact of the removal of fuel subsidy on the citizens. Maybe one of the things we should do is to provide a transport subsidy in form of N5, 000 or any amount that may later be agreed. The idea is to provide subsidy in the hands of people that really need it. That is a proposal from the ministry along with other proposals and it will be discussed and everybody will agree on the one that is most practical and easier to implement, especially as we want to make sure that only the right people get the subsidy.

“One other proposal that has been brought forward which is very key, is for us to identify through the transport workers union, commercial vehicles’ drivers; get them registered and pass the subsidy through them using vouchers. So, there are several options that we are currently working on. The committee again and part of their work is to engage labour, so that we are able to comply with the provisions of the Petroleum Industry Act,” the minister was quoted as saying.

Lawan counters

Fielding questions from State House correspondents Tuesday after a meeting with the President Buhari in Abuja, Senate President Lawan said Nigerians were concerned about the consequences of fuel price hike in event of subsidy removal.

He said the lawmakers had interacted with their constituents during their recess and were of the view that the burden of fuel subsidy removal shouldn’t be passed on to Nigerians.

“Many of us are very concerned with the recent agitations, protests, and many citizens were so concerned, our constituents across the country are very concerned that the federal government will remove the petroleum subsidy. And for us, as parliamentarians, as legislators representing the people of Nigeria, this must be of interest to us.

“And we’ve just finished our recess; we had gone home to our constituencies and senatorial districts. And we felt the pulse of our people. And I found it necessary to visit Mr. President, as the leader of our government and our leader in the country, to discuss this particular issue of concern to Nigerians, and I’m happy to inform Nigerians that Mr. President never told anyone that the petroleum subsidy should be removed.

“I know and I agree that the subsidy is very heavy. But I think we must never transfer the burden to the citizens. I believe that we need to look at the quoted figure of maybe 100 million litres that people claim we’re consuming. Is it real? I mean is it either under recoveries of subsidy? Is it really 100 million liters per day? How on earth are we consuming that? We need to look at this critically and see how we can find the truth because I am not convinced that within the boundaries of Nigeria, we are consuming 100 million liters.

“Probably, neighbouring countries maybe benefiting from this. Can’t we do something about it? It is a failure on us if we are not able to control it, this particular aspect of smuggling if the petrol and then in return, push the burden to the ordinary citizen.

“So, I want to commend Mr. President, for still keeping this philosophy of ensuring that the most ordinary Nigerian does not suffer in any way. Government is meant to serve people. And the essence of government we all know is to protect the lives and property and welfare of the people. And that federal aspect is part of the welfare.

“It may not be exactly the way we want it in the implementation of subsidy. But that is our challenge as an administration and as a government. So we need to come together, both the legislature, the National Assembly, and those people and institutions and organizations that are responsible in dealing with this matter, to find a solution to this,” he said.

When reminded that the fuel subsidy regime was not captured in the second half of the 2022 budget, and whether Nigerians should expect a supplementary budget that would address that, he said: “No I will not speculate, but what I’m telling you is, it is a burden quite alright. And we have to work as an administration; we need to work hard to find a solution to it. We shouldn’t push this burden to the ordinary man.

“A 100 million litres of petrol every day in Nigeria, I can tell you it is not correct. I don’t believe that. If it is not so, what do we need to do? We have to sit down and deal with this so that we find a solution as a government, not to push it to the people. If we do that, because it’s easier to just say we remove it. But of course, we know our situation today.

“People are taking out this petrol outside this country, the immigration, the customs, and everybody is supposed to be on their toes. Everybody should be on his toes. And we also need to mobilise our citizens, especially those at the borders. If you see something, say something, because these people are the ones that are causing us problems, they’re smuggling this thing. They’re not flying with it; they’re following villages and roads.

“So, we have to find a way so that the truth will be found. It can’t be 100 million liters. We can use the money freely for other things, especially social development, schools,  hospitals but if we don’t do something, how are we sure that it will not even become 200 million liters in future and by the time you remove, is going to put a whole lot of stress on the lives people.”

On whether the federal government would not remove fuel subsidy, he said: “No, I’m not going to speculate on that. But I’m telling you, what I know, from my discussions with Mr. President, and I don’t want to go beyond that kind of understanding. He didn’t tell anybody that we should go and remove petroleum subsidy.

“And those of us who represent the people know our people are already stressed over and again, this is going to kill everyone even if people don’t say, we know is going to be too much for them.

“So it’s our task. Are we not fighting in insurgency and terrorism? Is it not taking our money, is it not taking our resources. So it’s a challenge we need to fight, we need to deal with challenges. This is why we came into government. I don’t know what the solutions are, but we must find solutions. Somehow. This is our own task.”

On PDP govs’ position

Reacting to comments by governors elected on the platform of the Peoples Democratic Party (PDP) on the fuel subsidy removal, Lawan said: “Well, that’s their opinion. And they had their time. They should have done something about it. Now we have to do something about it. I have admitted that the burden is heavy.

“But I don’t think that the ordinary citizen should be the one to bear the burden. Those of us in government should come together and find a solution to this including the PDP states. And PDP as a political party, there must be an irreducible minimum level of partisanship. There’s a level at which you should not come down to because of politics. No. Citizens first, preserve the people, preserve the country, then we can look for any office to govern, but we shouldn’t toy with the lives of our people. I am very happy, very relieved with this meeting with Mr. President.”

FG’s borrowing

In a related development, the Senate Tuesday expressed worry over the continued borrowing by the federal government to  fund the nation’s infrastructure, even as it described it as a necessity in view of the dwindling revenue accruing to the country.

The position was made known by Senate president Lawan while welcoming members back from the yuletide recess.

He lamented that as far as borrowing and implementation of the N17.126trillion 2022 budget is concerned, Nigeria is caught between the devil and deep blue sea.

“Funding of the 2022 Budget is predicated on significant borrowing. Our country is caught between the devil and the deep blue sea. 

“We have to construct and provide infrastructure, in all parts of our country because infrastructure is needed for our nation to develop.

“However, we do not generate enough revenues to fund the provision of such infrastructure. Until more revenues are generated, the country has to borrow and also resort to other sources of funding our infrastructural development. 

“But we cannot continue to borrow endlessly. It is imperative that we need to improve on the revenue to Gross Domestic Product (GDP) ratio. At about 8% Revenue to GDP ratio, our country is basically at 50% of what is required of the revenue to GDP of 15% for it to support any significant economic development,” the Senate said.

On way out, he said: “The Senate will develop a strategy of engagement with revenue generating agencies on how to make them achieve their targets and generate more revenues in 2022. 

“We shall ensure that we boost their revenue generating drive with a view to reducing borrowing for development of our much needed infrastructure. This is a major challenge for our development and we need to treat as such.”