The Vice-Presidential candidate of the Peoples Democratic Party, PDP, Peter Obi has said the Nigerian government is subsiding inefficiency in the name of petrol subsidy.
Responding to a question on what they will do about subsidy if elected into office, during the Vice- Presidential debate on Friday, Obi argued that if the right things were done, the price of petrol would come down, insisting that subsidy was a waste of resources that should be put to better use.
According to him, subsidy should be done away with and the money spent on it put into sectors such as health and education. “What we are subsidising today is inefficiency. If you get it right, the prices will come down. There is no way a country can have a budget of N340b for health which translates to N5 per day for citizens and then pay a trillion for subsidy. There is no way you can have an education budget which is the most critical component of development at four hundred and something billion and then pay subsidy of a trillion. It is a waste. You need to reverse it because you are not dealing with the engine that will drive the economy tomorrow.”
Obi, noted that other countries were developing new economies away from oil, yet the Nigerian government was not paying attention, insisting: “What are you actually subsidising? Nigeria is one of the low car ownership countries in the world, it’s 10 per 1000, so we have two million vehicles and you are paying almost a trillion when you have 87 million people who are poor, you can do that. The truth is that we need to reverse it and if you do the right things, the price will come down. They are just paying for the delay in importation. We can’t continue to pay for inefficiency in this country.”
Also responding to the question, the candidate of Alliance of Alliance for New Nigeria, ANN, Khadijah Abdullahi-Iya said if elected, they would attack the institutions to ensure transparency in the running of their affairs as well as equip them technologically to ensure that “every form of corruption is tackled.”
Speaking further, she said: “If subsidy is being eliminated, what we want to do in Alliance for New Nigeria is number one to diversify the economy. If we are able to diversify the economy and stop the dependency on oil products, we will have little or no problem at all with subsidy and once we are able to get the resources freed from subsidy we will use it to do the four things that we have always talked about.
“We are talking about the restructuring of our infrastructure; we are talking about ensuring that most of these excesses are being allocated to various structures like education, health, healthcare workers and talking about complete overhaul of the civil service system. Subsidy is something that we will tackle very seriously.”
For the sitting vice-president, Yemi Osinbajo of the All Progressives Congress, APC, subsidy is a necessity and a way by which government tries to cushion cost for the citizens.
According to him, the problem with subsidy arises from abuse of the system. He pointed out that every government all over the world run one form of subsidy or the other.
“The major problems with subsidy are just the abuses that can attend a subsidy. A subsidy is not really a bad thing, just the abuses. What happened under the old subsidy regime was that several independent marketing companies will come in and say ‘we delivered five cargos of PMS whereas they delivered only one.’ So they made the subsidy in the difference. Today, it is the NNPC that is the sole importer of petroleum product so it is on the balance sheet of the NNPC that subsidy is being taken. Let me also say today that if you are to remove subsidy, petrol prices will go as high as N220 per litre. There is no country that don’t run one kind of subsidy regime or the other for the simple reason that sometimes you just need to take some of the cost effect from the citizens. For example, America subsidises agriculture, subsidises production and all sorts of things.
“If you have a petrol subsidy and I’m not saying it must be there forever, but if you have petrol subsidy, it helps because the moment you remove petrol subsidy, prices go up, everything goes up. Now while consumer spending is week and while we are trying to develop the economy and the capacity of the consumer to spend money, I think that at least a minimal subsidy is required and that’s why I think the subsidy regime is one we can tolerate. Obviously, we must remove it as time goes on but we can’t afford to remove it immediately otherwise we suffer the consequences,” he said.
Reacting to comments by the PDP Candidate, Osinbajo said; “The question to ask the Nigerians is how much they are prepared to pay for petrol because if you say to a Nigerian, remove subsidy or don’t remove subsidy, you hide the fundamental question. The fundamental question is, are you ready to take a N40 increase in petrol price today? We say no. We say that the average Nigerian cannot tolerate that price increase.”
READ ALSO: 2019: Conference Of APC Publicity Secretaries Urged To Tackle Propaganda, Fake News
Umma Getso, the Vice-Presidential candidate of the Young Progressive Party, YPP, simply described subsidy as a “scam,” even as she admitted to not having much to say about whether or not it should be removed. “I have never been in government before but the people that were and are, have said a lot about the issue of subsidy. I could remember during Jonathan when subsidy was removed, Nigeria was shut down and along the line during the early regime of president Buhari, fuel subsidy was removed and Nigerians were so patient thinking that we are going to achieve something. So I don’t think that as I’m standing here, I have much to contribute but to throw it to Nigerians. Subsidy has not been removed and still the lives of Nigerians have not improved. We have not seen anything substantial or tangible on the ground so to be candid, subsidy to a typical Nigerian is just a scam. That’s just all I can say,” she said.
The Vice-Presidential candidate of the Allied Congress Party of Nigeria, ACPN, Ganiyu Galadima also spoke in favour of removing subsidy insisting that the money spent on subsidy can be used in some other critical sectors. He also argued that if subsidy is removed, the economics of supply and demand will eventually regulate the sector.
His words: “There are so many things we can do with the money that will be removed from petrol subsidy. The market of supply and demand will eventually regulate it if the subsidy is removed. And there are so many critical sectors that the subsidy regime can be deployed to like the agricultural sector. There are crisis between farmers and cattle rearers, these people are not getting any attention from the government. If subsidy is removed, some of the money that is being wasted can be deployed to other uses.”
