Interview

Petrol subsidy removal will not lead to lower pump price —Pearse

A chieftain of Peoples Democratic Party (PDP), Dr. Tokunbo Pearse, who is a former governorship candidate and convener of the Reset Lagos PDP, speaks on the economic policies of the administration of President Bola Tinubu, among other issues. BOLA BADMUS brings the excerpts of the interview:

The APC government headed by President Bola Ahmed Tinubu has finally been inaugurated and now in charge in the last few weeks, can we get your reaction on the steps taken so far by him since he assumed office, has he started well?

His first step as he was being inaugurated was his first proclamation being the removal of fuel subsidy. I think that was a wrong move; it was heartless, reckless and ill- informed. It was a bougeousis proclamation that will benefit oil suppliers and punish the average oil consumers; that is, out of 200million Nigerians, 150million Nigerians will be earning less than N100,000 per month and they will be affected very negatively. The price of everyday commodities from food to transportation, anything you want to buy, household items, everything will go up in price. And with the minimum wage at N30,000 or below per month, with more than 80 percent of the population earning less than N200,000 per month, we would suffer a lot because of that subsidy removal. Once you have fuel subsidy removal and you have 80 percent of your population not having money in hand to spend when they bought fuel for their generators and for their cars and paid for transportation and everything becomes expensive. It reduces the money in circulation and once that happens, you are going to have recession. Even private sector employments would reduce, private sector investment would reduce, the economy would shrink because of that proclamation on removal of subsidy, and we may fall into recession. I think the president started very badly. Others things he had done were normal for new president when you get into office, you appoint your own officers into key positions which he has done, and that he has done fairly. I think he has not been as parochial and insensitive to the Federal Character as former President Muhammadu Buhari was and in that sense, he has done well. Quick appointments and fair, ethnically balanced, so far it appears to be so.

But some people are commending Mr. President for taking such step as they said the subsidy money had for a long time been going into private pockets, don’t you also think in that direction?

What I think is that people have misunderstood what exactly has been going on with oil subsidy. In the first place, subsidy money has not actually been going into private pockets. Yes, it is not true that subsidy money had been going into private pockets. We have been making a lot of money, have we not been enjoying subsidy? Okay, we have been enjoying subsidy, we have been paying a relatively low price for oil which means the masses have been enjoying subsidy, that is one. Two, if it is going into private pockets, it is nonsense because they, marketers are making profits. You give them subsidy and they are making profits. It is you government that would say okay, we are not going to pay you so much for subsidy, you understand me. For instance, if the price of fuel is N500 per litre, that’s what the government has been subsidising, so government has been giving them let’s say N300 subsidy per litre of petrol to the oil sellers, the marketers. The government can now say instead of giving you N300 per litre as subsidy, we are reducing it to N200 per litre.

How do you mean?

Government is not doing its job, the oil industry is filled with serious corruption, monumental corruption. Look at the amount of crude oil being stolen under the nose of former Minister of Petroleum Resources, former President Muhammadu Buhari, that is where the oil is going. When you talk about corruption, that is where the corruption is and who are the people stealing this crude oil? Look, there is no excuse for NNPCL to remove fuel subsidy. I am doing a thorough analysis of it and when I finish, you will see. There is so much money being wasted, being looted in the industry. Don’t pass the bulk on the population; deal with where the problem is, where the economy is leaking, that is where you should check. It’s not the money you are spending on the subsidy: it sounds like a lot of money, but when you look at the amount of money that is being made in the oil industry, it is insignificant.

Don’t you think removing the subsidy could at the end the day, maybe in two to three months from now, prices of the products could start coming down and things begin to normalise generally?

In the first place, you and I are Nigerians, may God spare our lives. When price goes up, does it ever come down?

We are looking at a situation when our refineries and the much-talked about Dangote Refinery will become fully operational and there may be no need for fuel importation again.

This is where the problem is. It just pains me that the populace, the people are always misinformed, that’s why I am doing it. Now, listen to this, this unbelievable. On June 1, 2023, Mele Kyari, the chairman of NNPCL was on Arise TV and he said even with Dangote’s production, and that from the Port- Harcourt Refinery and any other production, pump price of fuel will not reduce. It is on record, this high price is not likely to come down. If it doesn’t go down, one should start accepting it. It’s difficult to go back. So, marketers should now reduce their price, I doubt it.

You belong to PDP and even your presidential candidate, Alhaji Atiku Abubakar, during the campaign, talked about his plan to remove fuel subsidy as well if elected into office?

I would answer you two ways. One, he is not the president. If he had been president and I support him, you can ask me. I can guarantee you that if Atiku had become president, and allowed oil subsidy removal the way President Bola Ahmed Tinubu had done it, I would oppose him! And I want to guarantee you that Atiku being a very sensitive person; he wouldn’t do it this way. Let us see all the things you can do to reduce the burden on the masses; I am talking about 80 per cent of our population not just 20 percent of the population, people who are earning minimum wage. So, whether it is PDP or APC, I just tell the truth, it is wrong, it is not fair. It is not a question of PDP or APC. It is wrong, it is a burden, it would cripple this economy.

What is the way out now?

Retain the subsidy, and go after all the money that is owed to government. Stop the leakages in stealing of crude oil, control all the resources of the country. Look, between FIRS, NPA, NNPC and several other companies, private companies. No 1, the money that should be paid into the Federation Account by government agencies is not being paid. If they paid that money, forget about subsidy, we can afford it any day, we can afford so many things. Trillions of naira have not been paid into the government Federation Account, the money is being held by private people in government agencies, that is where you look to save money, not removing oil subsidy. I give you one example, Land Dues that is supposed to be paid by some 372,000 people who got government houses, has not been paid for over 15 years. Collect that money, you are going to save N6 trillion. If you do all of these things, you will have enough money and build the economy.

Alongside removal of fuel subsidy, the electricity sector is also talking about increasing the cost of supply. What do you say to this?

Nobody in Nigeria is going to have money to do anything: only few would survive. People would not be going to work. They would be avoiding going to work and you can’t sack them because they would go and get doctor’s leave of absence, all sorts of things, and they would be stealing from work. This is a commodity everybody is using, this is not just the bougeousis. The poorest person must have electricity whether by PHCN or by generators using petrol, both need money, is it going to come down? You increased the price of diesel, companies have been leaving Nigeria because of this very thing because power has been expensive. So, we will have to review our whole economic strategy. We have to diversify the economy; we can’t keep depending on crude oil. By the way, the refineries that they are setting up are good, but in about 20 years time, they are not going to find any market. That is why they are trying to make all the money from us, whereas they should be exporting.

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