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Reviving Cotton Production In Nigeria



President Goodluck Jonathan recently directed the distribution of free improved cotton seeds to farmers in Nigeria as part of the government’s strategy to boost cotton cultivation for economic value.

Jonathan said the gesture was in line with his administration’s commitment to revamp the agricultural sector, expand the economy and make agriculture a business.

Many agriculturalists have applauded the presidential initiative, noting that the use of improved seeds in cotton cultivation will ensure higher yields.

They noted that the provision of improved seeds could also help to reduce pest infestation and withstand the vagaries of weather.

For them, the initiative would also go a long way in fast tracking the revival of the famous cotton ginnery in the northern part of the country.

This underscores the decision of the Federal Government to partner with the West African Cotton Company (WACOT) on how best to resuscitate cotton production in the country by providing improved seeds to farmers.

The Minister of Agriculture and Rural Development, Dr Akinwunmi Adesina, while speaking at the MoU signing, recalled that the country’s turnover of cotton in 1980s was in excess of 8.9 billion dollars.

Adesina said the amount represented more than 25 per cent of the nation’s manufacturing contribution to the GDP, noting that the current turnover dwindled to mere 300 million dollars.

The minister regretted that employment generation from the textile industry fell from 700,000 in 1980s when the industry was flourished with more than 175 mills in operation to only 25,000 persons currently.

“Employment generation in northern Nigeria underwent a precipitous fall due in part to the collapse of the cotton and textile industry; it has also led to the attendant social unrest, economic strain and increasing rate of poverty,” he  said.

Adesina said the industries’ contribution to the value addition had dropped significantly from 25 per cent in 1980 to five per cent currently.

He said out of 51 ginneries in operation in the 80s, only 10 were currently functional at low capacity.

He also maintained that the partnership with WACOT was necessitated by the urgent need to restore the past glory of the cotton industry in Nigeria.

The minister said under the agreement, the overall plan was to raise productivity from 150 kilogramme to 450 kilogramme of lint by 2015 and double production from 120,000 tonnes of seed cotton to 760,000 tonnes in 2015.

“A major component of the plan is to multiply and distribute quality seed and raise quality of local lint through the use of appropriate packaging and cotton grading,’’ he posited.

Adesina noted that under the agreement, WACOT proposed a four-year seed multiplication plan to cover Adamawa, Borno, Jigawa, Zamfara, Katsina, Kano and Gombe states.

He said the government was making efforts to make available more hectares of land for cotton cultivation and that 105,307 cotton farmers across the 11 targeted states would benefit from the Growth Enhancement Support Scheme, covering seeds and fertiliser.

He expressed optimism that the successful implementation of the MoU would benefit the entire economy in the areas of employment generation and tax accruals to the three tiers of government.

To further make the textile industry viable, the government, he said, had taken measures toward eliminating illegal textile importers.

The Chief Executive officer of WACOT, Mr Tembe Ravi, applauded the initiative, noting that the initiative came at a time when cotton production in the country had declined from 300,000 tonnes to 65,000 tonnes in the 2010/2011 season.

Ravi stressed the need to make cotton business more attractive to farmers under the Agricultural Transformation Action Plan.

According to him, the focus of WACOT is to enhance yield per hectare, ensure remunerative price for farmers and improve the quality of the produce as well as processing and packaging.

In his comments at the inauguration of improved cotton seed distribution to farmers in Tsafe, Zamfara, Alhaji Lawal Yahaya, an official of WACOT said the company was expected to make available more than 3,200 tonnes of improved cotton seeds, 3,690 litres of chemicals and fertiliser for distribution to farmers at subsidised rates.

He said the beneficiaries were expected to repay 50 per cent of the loans with cotton produce at harvest time, while the Federal Government would pay 50 per cent of the cost of the inputs as subsidy contribution.

Yahaya assured that the partnership between the government and WACOT on the cotton seed multiplication programme would last for four years.

According to him, an estimated 15,650 hectares of land will be cultivated with cotton in Borno, Jigawa, Zamfara, Katsina and Gombe States to be purchased and marketed by WACOT.

The WACOT official added that the distribution of the high yielding cotton seed, launched in Tsafe, would be supervised by the Nigeria Agricultural Seeds Council to ensure transparency in the agreement package.

According to him, farmers in Zamfara are expected to cultivate more than 3,000 hectares of cotton, while their counterpart in Katsina, rated as the highest cotton producing State in country, will cultivate up 10,000 hectares during the 2012 agricultural season.

“With the improved seeds and the helping hand offered to farmers, cotton production is expected to multiply, while more marketing strategies are being understudied to ensure that the farmers get value for their investment,’’ he says.

He added that: “Statistics shows that no fewer than 675,000 persons have lost their jobs so far due to the decline in cotton production and neglect of the textile industry.

“It also indicates that employment generation from the industry also witnesses drastic fall from 700,000 persons to 25,000 persons today.

“Besides, the turn-over from cotton, production has fallen from an excess of 8.95 billion dollars in the 80s to an estimated 300 billion dollars,” he said.

He says to encourage cotton production, the Bank of Industry (BoI) has earmarked more than N70 billion for disbursement as loans to cotton farmers.

“Efforts have been made to provide more extension materials, training of farmers and strengthening of cotton related associations such as farmers groups, ginners, merchants, spinners and garment producers.

“These efforts will make Nigeria self-sufficient in cotton in terms of satisfying the demand of local industries as well as exporting surplus,’’ he said.

Stakeholders say the initiative appears to have started yielding positive results as many of the cotton producing States intensify efforts at rejuvenating various cotton farms.

Governor Ibrahim Shema of Katsina State acknowledges the strides so far achieved in reviving cotton production in the state.

He says the State government will continue to lend its support to the cotton transformation initiative, adding that cotton is grown in 23 local government areas in the state.

“Katsina State government will work in tandem with the Federal Government initiative as the cotton value chain plan will go a long way in reviving cotton production in the country,’’ he says.

Also, to complement the Federal Government’s efforts, the Bauchi State Government says it is resuscitating all the cotton ginneries in the State.

The Permanent Secretary in the State Ministry of Agriculture, Dr Dauda Abdullahi, says the State government has set up a cotton revival committee to mobilise the citizens to engage in massive cotton production.

“In 1951, a cotton ginnery was established at Misau under the British Cotton Growing Association but was not sustained due to poor production of the commodity by farmers in the state.

“The Misau Ginnery processed cotton produced in the former Bauchi province and other ginneries in the former Northern Nigeria and was a huge source of foreign exchange for the province and the region in general,” Abdullahi notes.

He says the new ginnery will be operated under the public-private partnership agreement with reputable experts in the marketing and processing of cotton to make it viable and of international standard.

He says the State will also collaborate with the Federal Ministry of Agriculture and Rural Development to address the production, processing and marketing of the product from the ginnery.

The permanent secretary says 510 farmers will be engaged during the 2012 cropping season to cultivate cotton while agriculture extension workers and farmers are to be trained on modern cotton farming techniques.

Reports gathered from Sokoto State say that the government is set to revive cotton production in the state to stimulate economic growth.

According to the reports, the government is also extending a number of incentives to investment in the agriculture and agro-processing industries.

With all these, cotton farmers believe that with adequate and improved cotton seeds available to them at subsidised rates, cotton production will increase to boost the nation’s economy.

Cotton is grown in Borno, Bauchi, Gombe, Sokoto, Zamfara, Katsina, Ondo, Oyo, Ogun, Kaduna, Kano and Jigawa.

Adamu, writes for News Agency of Nigeria (NAN)


Sani Adamu

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Another Look At Contributory Pension Act (2)



This is the concluding part of the article carried in our last edition Another problem with the Contributory Pension Scheme is the flagrant violations of the Employees’ Right under the scheme. According to the Pension Commission PenCom the Pension Reform Act  (PRA 2014) confers certain rights on employees, providing protection, compensation and alleviation to the employees and the loved ones during their service years and upon their retirement. The rights include the Right to Pension for workers in the Public Sector, Private Sector and Informal Sector as stipulated in Section 3(1) of the PRA (2014); Right to Employer’s Contribution of a minimum of 10 percent of monthly emolument (Section 4 (1)); Right to Insurance (Section 4(5)); Right to Determine how to access Retirement Benefits by choosing programmed withdrawal or Annuity. Specifically, Section 7(1) of the Pension Reform Act states: A holder of a retirement savings account shall upon retirement or attaining the age of 50 years whichever is later, utilise the amount credited to his retirement savings account for the following benefits:(a) Withdrawal of a lump sum from the total amount credited to his retirement savings account provided that the amount left after the lump sum withdrawal shall be sufficient to procure a programme fund withdrawal or annuity for life.
The Pension Reform Act stipulates “Right to choose a Pension Fund Administrator (PFA) in his or her name (Section 11(1).” Right to Timely Remittance: Under the Section 11(1) of the Act, employers are required to “not later than seven working days from the day the employee is paid his salary, remit an amount comprising the employee’s contribution and the employer’s contribution to the Pension Fund Custodian specified by the Pension Fund Administrator of the employee”. Some of the employees’ rights violated include: Right to employer’s Contribution of a minimum of 10 percent of monthly emolument as enshrined in Section 4 (1), which many States and Local government areas have failed to comply with. In fact, the Status of implementation of the contributory Pension is still deficient as many States, and Local Government Councils are yet to remit their employees’ contributions. Many States are yet to make their counterpart contribution for their employees to the fund since January 2018, according to PenCom. Some States including Gombe, Zamfara, Adamawa are still operating the Defined Benefit Scheme. As at March 31, 2023, about eleven States are yet to implement the Contributory Pension Scheme.
Meanwhile, some retirees lament their inability to access payment. Another snag is the outrageous and unsolicited deductions or shortchange of contributions on the scheme that is essentially saving in nature and ought to be “remedial” to the old Defined Benefit Scheme. According to the PenCom, the Status Contributory Pension Assets as at April 30, 2023 is N15.77 trillion. Instructively, the Contributory Pension Scheme started in 2015 following the enactment of the Pensions Reforms Act (PRA 2014).The Scheme is intended to enable employees “Seamlessly transfer their accumulated funds when changing jobs, ensuring continuous growth and uninterrupted savings accumulator.” This mobility is aimed at empowering workers to “Pursue new opportunities without sacrificing their retirement security”.
Presently in Nigeria, there are two extant Pension schemes under the National PenCom. According to the Commission, PenCom on differences between the Defined Benefits Scheme (DBS) and the Contributory Pension Scheme, the Defined Benefit Scheme under PenCom is administered by a Federal Government Agency, the Pension Transitional Arrangement Directorate (PTAD) while the Pension Fund assets under the Contributory Pension Scheme are privately managed by Pension Fund Administrators (PFAs) and kept in custody by Pension Fund Custodians (PFC).
The PFAs and PFCs are Private Pension operators licensed by the National PenCom. The Defined Benefit Scheme covers existing workers who have retired from service before the enactment of the Pension Reform Act and employees exempted from the Contributory Pension Scheme (CPS) such as: Judicial Officers, Personnel of the armed forces, Personnel of the intelligence and security services. However, the Contributory Pension Scheme covers: public servants working for the Federal Government of Nigeria, public servants working for the Federal Capital Territory (FCT), or working for each of the 36 States of the Federation, or the local government councils in Nigeria, employees in the Private sector organisations where there are at least  three, and those in the informal sector which covers any economic activity or source of income that is not fully regulated by the government and other public authorities. As relating to the Funding of the two pension schemes, the Pension Transitional Arrangement Directorate (PTAD) is funded from the budgetary provisions by the Federal Government while the Contributory Pension Scheme is funded through monthly contributions from the employees’ salaries and the contributions of the employers.
There are no individual Pension accounts under the Defined Benefit Scheme. But there are individual Pension accounts under the Contributory Pension Scheme. By the provision of the Pension Reform Act , everyone is required to open a Retirement Saving Account (RSA) of his or her choice. The RSA which has a unique Personal Identification Number (PIN) is for life, regardless of transfer of service or change of employment. According to the National Pension Commission, the total number of Retired Saving Account registration as at April 30, 2023 is 9,968,388.
The challenge associated with the Defined Benefit Scheme is the lack of adequate funding by the Federal, State and Local governments to pay retirees under the scheme. This alleged lack of funds, informed the Contributory Pension Scheme as the only veritable alternative.  But the Contributory Pension Scheme which is supposed to improve on the old Defined Benefit Scheme is fraught with several hydra-headed and multi-dimensional problems that negate the welfare of workers and retirees. So the hue and cry of public servants should be appreciated. No public servant would spend his or her productive years in  serving the State or country only to suffer loss in the long run.

By: Igbiki Benibo

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Another Look At Contributory Pension Act… (1)



The Pension Reform Act 2014, that midwifed the Contributory Pension Scheme is one legislation in Nigeria that poses great concern and apprehensions to Public Servants in particular. Though the Contributory Pension Scheme was designed to remedy or mitigate the alleged deficiencies and inadequate funding of the Defined Benefit Scheme, (DBS) by pooling funds from employers and employees’ contributions to Pension Funds Custodians, retirees under the Scheme, have not fared better than those who retired under the Defined Benefit Scheme. Conversely, the implementation of the Contributory Pension Scheme, is a far cry from what its proponents lulled employees to believe.
Complaints ranging from under payment of retirees under the Contributory Pension Scheme, despite several years of service (Some of whom served 35 maximum years), corruption, non compliance of State governments and other Employers of Labour to provisions of the extant Reform Act, 2014, characterise implementation of the scheme, which Labour leaders in the country describe as anti-workers and retirees welfare.
So the Contributory Pension Scheme which purports welfare and blessedness to retired workers under the scheme, seems obnoxious, counter-productive, shrouded in uncertainty and a failed mission.
Dissatisfied with the scheme, the Association of Senior Civil Servants of Nigeria called on the Federal Government to scrap the scheme, describing it as a “huge fraud”. The group made the appeal in Port Harcourt during its Annual Delegates Seminar for South-South Zone.
“The Present Contributory Pension Policy of the Federal Government should be scrapped. We discovered lately that the Pension Policy is a fraud on workers”, posited Yusuf Emmanuel, Chairman-General, Ministry of Defence Unit 2, Lagos Outstations.
In the same vein, the River State Chairman of Nigeria’s Mother Labour Unions – Nigerian Civil Service Union has appealed to the Rivers State Governor, Sir Siminalayi Fubara to “outrightly repeal” the Contributory Pension Scheme in Rivers State, because “It is not in the interest of civil servants”.
Comrade Chuks Osummah, the Rivers State Chairman of the Nigeria Civil Service Union, who made the appeal at the event to mark the Union’s 111 years of existence in Nigeria, expressed worry over the fate of workers who will retire under the Contributory Pension Scheme.
“We are calling on the Executive Governor of Rivers State to abolish the Contributory Pension Act as it is not in the interest of Rivers State civil servants”, a worried Osummah said.
Meanwhile, the National Assembly workers have left the scheme. The exit of workers of the highest law making organ in Nigeria further lends credibility to the agitations that all is not well with the Contributory Pension Scheme.
Less than 24 hours to abdicating office, former President Muhammadu Buhari removed the National Assembly workers from the scheme by assenting to the National Assembly Service Pensions Board Bill. Former President Buhari’s decision to remove the National Assembly workers from the Contributory Pension Scheme no doubt, does not only smack proof of reality of workers displeasure over the scheme but is a window for State.
Governments or other sectors that the Scheme covers, to opt out. A major reason that the National Assembly workers advanced was that the monthly stipends paid is low and paltry. And that pensioners under the Contributory Pension Scheme are lacking in many other benefits. In the Scheme, retirees are only entitled to what they saved from their contributions into Retirement Savings Account with the Pension Fund Administrators.
The fears of public/civil servants are not unfounded because though over 25 States of the Federation have adopted the Contributory Pension Scheme in principle by enacting relevant legislation, only six states of the Federation and the Federal Capital Territory — Abuja, have fully complied with the provisions of the extant laws on the Pension Reform Act. Full compliance and implementation of the Scheme has remained an uphill task denting the integrity of the scheme and its purported benefits for workers in the public, private and informal sectors the scheme was designed to cover.
According to PenCom website, “Full compliance by State governments with the implementation parameters such as remittance of both employer and employee Pension Contributions, payment of accrued rights, institution of the Group Life, are still relatively low”. It is also evident that while some State governments deduct and remit workers’ contributions, the states have failed to contribute their counterpart fund to the scheme; This violates provision of Contributors’ right as enshrined in Section 4(1) of the Pension Reform Act 2014. The Section provides that as an employee’s right, the employer shall contribute a minimum of 10 percent of the employee’s monthly emolument to his/her Pension Fund Custodian.
Under Section 11(1) of the Pension Reform Act, employers are required to “not later than seven working days from the day the employee is paid his salary, remit an amount comprising the employee’s contribution and employer’s contribution to the Pension Fund Custodian specified by the Pension Fund Administrators of the employee. The failure of State governments to act according to the express and unambiguous dictates of such extant provisions poses a grave and bleak future for the employees on retirement.By the refusal of State governments and other employers to make their counterpart contributions, no doubt, the scheme can not guarantee security for the welfare of the workers on retirement. The fate of employees, especially those working before the enactment and implementation, seems to hang on the balance; an aura and premonition of uncertainty on the seamless disbursement of what is legitimately their entitlement remains a puzzle, since they are likely to lose financial benefits for all the years they have served before the implementation of the Act in the State. Another misgiving that workers have with the Pension Scheme is the effective date of the Act.
Some workers argue that since the Pension Reform Act was enacted in 2014, it should have excluded workers already employed in the Public Sector before 2014, when the law was enacted. They argue that the effective date is “Pre-emptive” and retrospective, adding that laws are not implemented in retrospect.
According to a unionist and a Port-Harcourt based lawyer, Tamunobarasua Omoni, the effective date of implementation can shortchange workers employed before the effective date.
“You know that there are people that have been working in the public sector before the Reform Act was enacted in 2014. And their employer started remitting their contribution in 2018, what happens to the several years they have worked without contributions?
“The crux of the matter is the inclusion of those who are already working before the effective date. Such pre-emptive legislation could deprive workers their entitlements because benefits accruing to workers are dependent on amount employers and employees contributed.”
Barrister Omoni is of the view that all employees before the enactment of the Reformed Pension Act 2014 should remain under the Defined Benefit Scheme while the Contributory Pension Scheme should function with those employed after 2014.
To be continued in our next edition.

By: Igbiki Benibo

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Palliative And Sustainable Economy



The President Bola Ahmed Tinubu-led Federal Government last Thursday, 16th August 2023, announced a N5 billion palliative for each of the 36 states of the Federation and and the Federal Capital Territory (FCT) (FCT), Abuja to cushion the harsh socio-economic realities of the removal of subsidy on petroleum products, on the groaning masses. The governor of Borno State, Babagana Zulum, made the announcement in Abuja when he spoke to State House correspondents after a National Economic Council meeting presided by the Vice President of Nigeria, Alhaji Kashim Shettima. The Federal Government’ had initially announced its plan to give a paltry N8,000 to 12 million vulnerable households every month under a six-month purported welfare scheme.
However, such plan did not go down well with the masses as the removal of subsidy on Petroleum products has dealt untold hardship on the people. The cost of living has quadrupled. Transport fares, house rents, prices of material necessities, cost of education and doing business such as small and medium scale enterprises and other businesses that depend on petroleum products, have further increased. The consumer of the goods and services bears the brunt of it all. For instance, the cost of photocopying a page document that was N5 is now N50, about 500 percent increase. However, the upwardly reviewed N5 billion palliative to each of the 36 states of the Federation and the FCT Abuja appears to elicit a flicker of hope and earns the approval of some Nigerians when compared with the N8,000 for each of the target 12 million households across the country which some people described as “assault on the sensibility of Nigerians” and “anti-poor poor” policy.
In fact, the organised labour, under the aegis of the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC), had insisted that the palliative proposed by the Federal Government’ was far from being enough and insignificant to cushion the sufferings in Nigeria, following the removal of subsidy on petroleum products. However, as commendable as the N5 billion palliative to states and the FCT would appear, will the reviewed Palliative translate to a sustainable economic impact on the masses? How long will such harsh economy cushioning measures last in a country where proactive economic measures to fundamentally address the spiking poverty level in Nigeria, is elusive?
Speaking on the palliative, a small business operator in Port Harcourt, Mr. John Chukwudi, did not believe that the palliative measure will address the multi-dimensional problems faced by the citizens without putting in place basic infrastructure like refineries and electricity as well as upward review of salaries of workers.
According to Chukwudi, the sad experiences of the Ebola and COVID-19 intervention schemes further cast doubt on the possibility of palliative on subsidy removal getting down the vulnerable people. “I don’t believe that this money released by the Federal Government’ to ease the sufferings of the people will really get to them. Were you not in this country during the Ebola, COVID-19 and flood periods, did money or relief materials really get to vulnerable people? Some of the materials were stocked in warehouses in some states while the people wallow in poverty and pains”. Mr. Chukwudi, who was pessimistic about the implementation of  palliative scheme in the States, said “ For me, seeing is believing”. For Mrs. Sopakirite Lily-West, an agro-allied economist, palliatives without basic infrastructure is a defective measure of addressing a socio-economic problem like the one Nigeria is into presently. She said palliative is only a temporary, stop-gap measure while lasting measures are being put in place.According to her, spending N185 billion Naira on palliative, if not well invested will translate to a colossal and monumental waste.
“Imagine that the Federal Government’ had put such N185 billion on an infrastructure to boost the economy, what that will yeild to, in five years.The present administration would have put in place infrastructure like improved electricity, functional  refineries and friendly business environment before removal of petroleum subsidy. “For me what the Federal Government under President Bola Ahmed Tinubu has done is putting the cart before the horse. There must be a collision and counter-productivity”.
A Port Harcourt based lawyer is of the opinion that giving N5 billion to each of the 36 States and the FCT is a covert way of increasing the capacity of some State governors to spend frivolously, waste, siphon public. funds.According to Mr. Sobere, “ You know that some State governors don’t have a sustainable economic development blueprint for the state they are governing.
So when such special money which is actually meant to make the people heave a sigh of relief comes, it is like an imprest for the governors. We are here in Nigeria, we saw what happened when relief materials given to flood victims by donor organisations including multinational companies did not get to most of them. You should also not forget the COVID -19 intervention schemes, and Ebola intervention, how many vulnerable people benefitted? Rather, it was a smokescreen for some of those in Government to share it among themselves to the exclusion of the needy”. In his view, a Christian cleric in Rivers State, Rev. Dr. Daddy Ibulubo, that the Federal Government’ dropped the proposal to give only N8,000 for each of the 12 million target households in the country and released N5 billion to each state and Abuja, shows it is listening to the people.
According to Dr. Ibulubo who is the Rivers District Superintendent of Assemblies of God, Nigeria, “frankly speaking the initial amount of N8,000 palliative was grossly inadequate considering the high cost of living in the country. The Federal Government’ is spending N185 billion as against about N480 million on the initial plan. I hope that State Governors who are trustees and stewards of the people’s resources will give value to every kobo received to alleviate the plight of the suffering people of the country. The people are really suffering. And the suffering is man-made. So they should be proactive to address it “ For its part the central Labour organisations, the NLC and TUC have urged the Federal Government’ to make upward review of workers’ salaries and wages as an integral factor of the palliative scheme.
The umbrella unions had proposed a N200,000 National Minimum Wage for the Nigerian worker. Joe Ajaero of the Nigeria  Labour Congress in a speech recently gave President Tinubu a knock for not working the talk on public servants’ salaries.
“Labour is disturbed that while President Tinubu in his speech lavishly praised the private sector for quickly dispensing wage awards to their employees, the Federal Government’ has failed to do the same for public workers in its employment. This is a case of failing  woefully to live up  the standard it has set  for others to meet”, Comrade Ajaero said.As measures to cushion the effect of removal of subsidy on petroleum products on public servants, some State Governors and Government institutions have  also announced the reduction of official work days from five to three. The governors include those of Edo, Borno, Bayelsa, etc. The management of University of Ibadan has also reduced its working days.
However, the Rivers State Governor, Sir Siminalayi Fubara has purchased and put on various routes in Port Harcourt metropolis and its environs a fleet of vehicles to ease movement at no cost to the commuters with a view to cushion the effect of the subsidy removal on the residents of the State. This is aside other relief packages the Rivers State Governor has promised to roll out soonest, while the promotion to various salary grade levels of  more than 4,000 workers in the State public service, had been implemented by Governor Fubara with assurances of improving on the welfare of workers. Meanwhile, the Rivers State Government  has also commenced rehabilitation of the State Secretariat in keeping with its Civil Service friendly policy. The President, Bola Ahmed Tinubu had in his maiden address to the people said the removal of subsidy on petroleum products is a necessity to prevent the country from “going under” and deliver the economy of the nation from the stranglehold of a few unpatriotic elements in the country.
While many agree with the present and successive administrations that the removal of subsidy is necessary to free and channel funds accruing from the subsidy removal into critical areas of infrastructure, the implementation of policy is hasty and ill-timed.Economists and Labour leaders have advocated for the rehabilitation of nation’s four refineries to make them work at installed capacities, regular power supply, provision of welfare packages for workers and others The unavailability of pre-subsidy removal incentives have triggered among several other challenges, high cost of living and outrageous hike in the pump price of petroleum products. A litre of premium motor spirit known as petrol, is now sold for about N700. While the masses associate high pump price of petroleum products to the moribund state of Nigerian refineries, the Senior Special Assistant to the President on Public Affairs, Aguri Ngelale told Nigerians “to disregard the myth that more refineries in Nigeria would translate to cheaper fuel price”
He said having more refineries  would save Nigeria the cost that would have gone into importing fuel products. According to Ngelale, “that is a myth, it does not happen anywhere in the world, even if we had the most refineries producing the most PMS in the world, you would find that the most prolific PMS producers with their refineries do not charge differently from the countries without refineries”, Ngegale said  in an interview on TVC. The kernel of it all is that making all refineries in Nigeria work at installed capacities will not scale down the pump price of petroleum products. That would suggest that Nigerians are living at the mercy of market forces. So Nigerians should cultivate the frame of mind of adjusting to new increases as may be dictated by the market forces.
If refineries are fixed to work at installed capacities and the anticipated relief is not realistic, if “PMS producers with their refineries do not charge differently from countries without refineries”, then huge amount of money put in building and maintaining the refineries is a colossal waste. And Nigerians should be ready to live with the  multi-dimensional challenges, pain and hardship posed by removal of subsidy on petroleum products. No wonder Mr. President did not include fixing refineries as part of his administration’s plan to solve the economy problem. His inclusion of the refineries following a knock by the NLC president was an after-thought designed to soothe frayed nerves. Let the palliative stimulate  a sustainable economic growth for States and the country. A sustainable economic growth is the bedrock for national development, and massive job creation.

By: Igbiki Benibo

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