The Federal Government and the organised labour would reconvene on February 22 for the consideration of the reports of their bipartite technical committees on fuel price and electricity tariff.
The resolution was reached at the end of the meeting between the representatives of the organized labour and the Federal Government team on Monday night at the Old Banquet Hall, Presidential Villa, Abuja.
Briefing journalists at the end of the bipartite meeting, yesterday, the Minister of Labour and Employment, Dr Chris Ngige, said they received and adopted the report of the Technical Committee on Premium Motor Spirit (PMS) Pricing Framework, while that of the Electricity Tariff Committee was expected in a week’s time.
Ngige said the organised labour requested for some time to subject the report on PMS pricing to their organs for further investigation.
According to him, “It is a technical report, so they needed further investigation of the report by their own technical research team. The Technical Committee on electricity tariff has not finished. We expect the report in a week’s time. So, cogently, we are reconvening on 22nd of this month to take both reports.”
The report of the Technical Committee on PMS pricing was presented at the meeting by the Chairman of the committee and former Executive Director, Refineries Operation and Petrol Pricing in NNPC, Onochie Anyaoku.
Anyaoku, in his presentation, said that the report was a 100 per cent owned by the membership of the technical committee, and they have all endorsed it.
He recalled that the terms of reference, jointly agreed to by the bipartite parties, include to review the cost of supply and incidental commercial costs of PMS and arrive at the basis of determining market reflective pump price gap under the template of the PPPRA Act, to engage all relevant stakeholders to establish the price review framework and to carry out any other assignment that will facilitate the work of the committee.
He further said the committee at its meeting on December 16 developed guiding principles and a work schedule, technical and distinct from the primary function of PPPRA, to develop a transparent methodology and a template that will serve as the guide on realistic PMS pump price and benchmark all pricing elements of the PMS pricing template, with neighbouring countries.
He said, “The comparison shall cover all fixed and variable components of PMS pricing bureau. Existing PPPRA template to serve as a baseline template and new additions of template incidental cost where appropriate shall be sufficiently justified.
“It is important to point out that we tried not to add. We tried to interrogate and most importantly, we tried not to add any inefficiencies of the delivery logistics of PMS to the public. So, basically, we interrogated every line item on the PPRA template.
“I must point out that the Act establishing PPPRA is very comprehensive and very inclusive if implemented as intended. I must also show here that the import base of PMS, essentially places very narrow latitude for cost reduction in price determination.
“Based on an extensive review of the pricing framework and in line with the terms of reference of the committee, the following recommendations were proposed and adopted: ‘PPPRA to convene periodic meetings with PPMC and other importers to ensure the actual cost of supply reflective determination as an interim solution.
“NLC, TUC, PENGASSON and NUPENG to witness the transparent determination at the periodic meeting.
“PPPRA frequently monitor data of Rotterdam supply chain values. This should continue to form the basis of price determination until the West African basket is liquid and transparent enough to warrant its adoption in the pricing template.
“All importers including NNPC to adopt the same forex window used by PPPRA to ensure alignment and accurate pricing. PPRA board to adopt a weighted average as the basis of the determination.
“Government to enforce immediate collection of NPA and NIMASA charges in naira to reduce pressure on forex demand and pump price hike.
“To develop adequate communication strategy on the necessity of deregulation and the benefit to the people, to create public awareness and gain acceptability of deregulation, which will reduce the pressure on labour to react to fuel increase.
“Deregulation is a huge change in national policy but highly desirable in this stage of our national development policy, for which its implementation requires trust-building steps and commitment to visible frugal spending by government. Intensive and sustained communication between government and stakeholders is mandatory to reassure citizens when price change, especially in an upward trajectory.
“Government should consider certain projects targeted at winning the confidence of Nigerians on the key benefits of deregulation.”
The Report of the Technical Committee on PMS Pricing Framework was an offshoot of the ongoing bipartite engagement between the Federal Government and the organised labour unions.
The membership of the committee includes the representatives of NLC, TUC, NUPENG, PENGASSON, PPPRA, PEF, Federal Ministry of Finance, Budget and Planning as well as Federal Ministry of Labour and Employment.