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Protests Suspended as FG Cuts Petrol Price to N97

16 Jan 2012

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President Goodluck Jonathan

By Ahamefula Ogbu

President Goodluck Jonathan, in a nationwide TV address Monday morning, announced a cut in petrol price from around N141 to N97 after prolonged street demonstrations over the deregulation policy.

Also, the labour unions told the media early Monday morning that they were suspending street protests because of the political dimension it had taken but insisted that the strike would go on.

In the broadcast, Jonathan said he had to review the pump price in response to the outcry over the hardship caused by the total subsidy removal and vowed to investigate the subsidy account with a view to punishing those who fraudulently bled the country and nearly destroyed the economy.

He also promised a detailed study of the forensic audit of the account of the Nigerian National Petroleum Corporation, (NNPC) with a view to curbing corruption in the oil and gas sector of the economy so as to rid it of corruption.

He promised that his government would pursue the passage of the Petroleum Industry Bill with more vigour to ensure it becomes law to regulate activities in the downstream sector.

Jonathan said: "This is the second time in two weeks I will address you on the deregulation of the downstream petroleum sector. In the last seven days, the nation has witnessed a disruption of economic activities. Although, the economic imperatives for the policy have been well articulated by government, the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC) went ahead to declare a nationwide strike.

"There was also near-breakdown of law and order in certain parts of the country as a result of the activities of some persons or groups of persons who took advantage of the situation to further their narrow interests by engaging in acts of intimidation, harassment and outright subversion of the Nigerian state. I express my sympathy to those who were adversely affected by the protests.

"At the inception of the deregulation policy, Government had set up the Justice Alfa Belgore Committee to liaise with Labour and other stakeholders to address likely grey areas in the policy, but despite all our efforts, Labour refused the option of dialogue and also disobeyed a restraining order of the National Industrial Court of Nigeria.

"However, following the intervention of the Leadership of the National Assembly, and other well-meaning Nigerians, Labour accepted to meet with government, but this yielded no tangible result. 

"It has become clear to government and all well-meaning Nigerians that other interests beyond the implementation of the deregulation policy have hijacked the protest. This has prevented an objective assessment and consideration of all the contending issues for which dialogue was initiated by government. These same interests seek to promote discord, anarchy, and insecurity to the detriment of public peace."

Jonathan, however, assured Nigerians that he would always respect their right to expression of their minds and commended those who conducted themselves lawfully within the period as well as proffered useful suggestions on the way for and credible alternatives to subsidy removal and acknowledged that he knew it would cause pains which, however, would be temporary before the gains of the policy.

"Government will continue to pursue full deregulation of the downstream petroleum sector. However, given the hardships being suffered by Nigerians, and after due consideration and consultations with state governors and the leadership of the National Assembly, government has approved the reduction of the pump price of petrol to N97 per litre. The Petroleum Products Pricing Regulatory Agency (PPPRA) has been directed to ensure compliance with this new pump price.

"Government is working hard to reduce recurrent expenditure in line with current realities and to cut down on the cost of governance. In the meantime, government has commenced the implementation of the Subsidy Reinvestment and Empowerment projects: including the Federal Government-assisted mass transit programme which is already in place, and job creation for the youth. 

"Furthermore, the legal and regulatory regime for the petroleum industry will be reviewed to address accountability issues and current lapses in the Industry. In this regard, the Petroleum Industry Bill will be given accelerated attention. The report of the forensic audit carried out on the NNPC is being studied with a view to implementing the recommendations and sanctioning proven acts of corruption in the industry.

"Let me assure Nigerians that this administration is irrevocably committed to tackling corruption in the petroleum industry as well as other sectors of the economy. Consequently, all those found to have contributed one way or the other to the economic adversity of the country will be dealt with in accordance with the law.                 

"My dear compatriots, I urge you to show understanding for the imperatives of the adjustment in the pump price of petrol and give government your full support to ensure its successful implementation. I further appeal to Nigerians to go back to work and go about their normal duties as government has made adequate arrangements for the protection of life and property throughout the federation.

"Government will not condone brazen acts of criminality and subversion. As President, I have sworn to uphold the unity, peace and order of the Nigerian State and by the grace of God, I intend to fully and effectively discharge that responsibility.  Let me add that we are desirous of further engagements with Labour. I urge our Labour leaders to call off their strike, and go back to work.

"Nigeria belongs to all of us and we must collectively safeguard its unity," he concluded.

Labour leaders had risen from a meeting with the president Sunday night saying they would go back to meet and decide "on the next line of action" over the proposal by government to cut petrol price.

There were strong indications that the new price might have been accepted by all parties as labour said it was "on the same page" with government which was persuading them to see reason for an increase in petrol price or partial deregulation.

Addressing the media after the meeting with Jonathan Sunday night, Nigeria Labour Congress (NLC) President Abdulwaheed Omar said they were persuaded on the position of the president that for the past five years, the price of fuel had been at N65 per litre while the dollar had been rising and stressed the need for a price increase.

Sources at the meeting said labour agreed to meet with the Justice Alfa Belgore Committee for two days to work out modalities on the deregulation policy and would, by Wednesday, give their final word on the matter.

"We are going to sit down and analyse the position of the president. We will meet and come out with statement today," Omar said.

Those at the meeting include Chairman of the Nigeria Governors Forum and Governor of Rivers State, Rotimi Amaechi, and the Minister of Labour, Chief Emeka Wogu.

Labour had declared an indefinite strike starting a week ago over the January 1 increase in petrol price which used to be N65 per litre.

Meanwhile, the Ministry of Petroleum Resources has invited the Economic and Financial Crimes Commission (EFCC) to investigate payments made in respect of the importation of Premium Motor Spirit (PMS) and Kerosene and prosecute anyone found to have been involved in over-invoicing, fraud and any related illegalities.

Also, the Federal Government has ordered an immediate review of the audited report of the Nigerian National Petroleum Corporation (NNPC) and all parastatals under the Ministry of Petroleum Resources with a view to commencing immediate implementation of their findings.

These were part of a two-page statement released by the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, who also said she had already en-panelled a unit in her office to begin a comprehensive review of management control in all parastatals in her ministry.

Other actions she said she had kick-started included a scheduled meeting with the National Assembly with a view to ensuring the immediate passage of the Petroleum Industry Bill (PIB) on which the comprehensive reform of the oil sector in the country would be anchored.

“With presidential approval, I have written to invite the EFCC to immediately review all payments made in respect to subsidies on PMS and Kerosene and take all necessary steps to prosecute any incidence of malfeasance, fraud, over-invoicing, and related illegalities in open and transparent manner.

“I have set up a unit within my office to be headed  by an independent auditor to review the KPMG and other audit reports on NNPC and other parastatals, and immediately begin implementation of their findings, ensuring, at all times, full probity and value for money.

“I am en-panelling another unit in my office to begin a comprehensive review of the management controls within all parastatals in the Ministry of Petroleum Resources, including but not limited to NNPC, PPPRA and DPR. Accordingly, I expect a report in 30 days to enable us take further action in reforming management, personnel and other practices and procedures in parastatals within the Ministry. It should be noted however that this process has already begun in PPPRA and DPR where management changes and reform are beginning to yield desirable results; and

“I will be meeting with the Senate President and the Speaker of the House of Representatives in the coming week to seek their cooperation and leadership in the quick passage of the Petroleum Industry Bill so that we can anchor the comprehensive reform of the oil industry,” Alison-Madueke said in the statement.

In a letter dated January 12, 2012 addressed to the acting EFCC Chairman, Ibrahim Lamorde, with reference number HMPR/EFCC/01/0002, Alison-Madueke wrote that Nigeria had been operating a subsidy regime on import of petroleum products where the difference between the cost of importation and pump price was paid by the government at a pre-approved oil marketing company which she has the approval of the president to investigate.

“Over the years, this bill has grown exponentially to unsustainable levels. As Petroleum Minister, I have become extremely concerned with these figures and following the recent transfer of the PPPRA to my ministry last year, I have moved quickly to change management and inaugurate a comprehensive reform process which include drastic cuts in the list of importer, review of payments and procedures, as well as massive re-deployment of staff within the agency.

“To now deepen my reforms and ensure that we root out all forms of corruption and abuse within the subsidy regime. I have sought and obtained the approval of President Goodluck Ebele Jonathan to formally invite the EFCC to immediately review and investigate all payments made in respect of subsidies checked against actual importations and to take all necessary steps to prosecute any person(s) involved in any incidence of malfeasance, fraud, over-payment and related illegalities,” she said.

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