Fuel Price Increase– Same Old Absurd Story

 

(Text of a Press Conference Addressed by Comrade John Odah, General Secretary, Nigeria Labour Congress (NLC),  on Wednesday, 13 August 2008 at the Labour House, Abuja)

 

 

 

Gentlemen of the Press,

 

The Nigeria Labour Congress wishes to react to the renewed and repeated threats by the Federal Government to increase the prices of petroleum products at the end of the extended moratorium.  

 

The NLC remains opposed to any increase in the prices of petroleum products. At the moment, fuel prices in Nigeria are unbearable for the poor, working people, industry operators and other productive players in the economy. Our fuel prices are among the highest in OPEC.

 

We are at pains to understand why the Minister of State for Petroleum, Mr. Odein Ajumogobia, should reduce a serious issue to simple-minded declarations. Only the Minister probably believes that inflicting higher fuel prices would not hurt the poor and that the government is merely subsidising the rich car-owners. The whole essence of the NLC’s opposition to fuel price increases is its negative impact on the people, especially the poor who constitute more than 70% of the population.

 

It is fraudulent for the Minister and other agents of government to insist that the subsidy is largely for the rich car-owners. Given the absence of alternative modes of transportation, Nigeria still relies almost exclusively on road transportation to move people and goods. Therefore, high costs of fuel affect everybody, especially the poor. As demonstrated in the past, costs of transport instantaneously rose by wide margins following any increases in fuel prices. This shows that the effect is general and bites harder on workers, peasants, students and other disadvantaged Nigerians.

 

Similarly, previous price increases have led to immediate astronomical increases in the prices of other commodities and services, especially house rent, food and basic consumer items. Such previous increases had led to severe erosion in the value of wages and deepened the poverty situation of the people.

 

What has happened today to the price of diesel is a demonstration of the severe crisis that will be inflicted on the people if the Minister were to carry through this threat in relation to petrol. What Nigerians expect is that government will intervene even on diesel to bring it under the same arrangement with petrol in order to guarantee stability.

 

Government needs to advert attention to the high cost of doing business which higher fuel prices will inflict on the economy. For us in the NLC, one of the most fundamental challenges of governance today is to make the operating environment more favourable for productive activities. With Mr. Ajumogobia’s scenario, the operating environment will become harsher while more businesses will fold up and send more Nigerians out of employment. Any government that is incapable of appreciating this is certainly a liability to the development process.

 

It is also important to insist that the Minister of State for Petroleum should tell the nation the steps government has taken to revive the four refineries. Ultimately, the real challenge is to develop sustainable capacity for domestic refining of petroleum products, build new refineries and create conditions for bringing other players into the domestic refining stream.

 

Over the last one year, the NLC has made sustained efforts towards dialogue with the Federal Government on issues pertaining to pricing and availability of petroleum products. The ideas was that we could take advantage of the moratorium on pricing to address ways to get the country out of the vicious cycle of crisis associated with pricing. Indeed, based on the directive of Mr. President, an exploratory meeting between the current Minister of State for Petroleum and the NLC did agree on modalities for a stakeholders’ forum, which the Federal Government was expected to convene.

 

Unfortunately, the recent statements by the Minister indicate utter bad faith, unwillingness to live up to commitments and aversion to dialogue on the part of the Federal Government. The NLC strongly condemns this degeneration to the deceit, ambush and pointless belligerence employed by the previous administration.

 

The NLC is calling on President Umaru Musa Yar’Adua to ensure that the Federal Government returns to the table on this matter in good faith and without pre-empting the outcome of dialogue. We also urge the President to spare the nation the cycle of arbitrary fuel price increases and bitter confrontations between government and the people. In addition, Mr. President should call the Petroleum Minister to order. The threats being issued by the Minister merely show that this government is no different from its predecessor in its contempt for public opinion. Respect for the welfare and opinion of the public calls for restraints, not reckless threats.

 

In furtherance of the commitment of the NLC to the welfare of our constituency and the generality of the Nigerian masses, we will continue to oppose the imposition of harsh fuel prices. The NLC will continue to work with our civil society allies to resist any attempt to add to the hardship of the people through arbitrary fuel price increase.

 

We thank you for your attention.

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