FG VS NUPENG

Vincent Obia writes that NUPENG and the federal government are in a duel over subsidy payment to indicted oil marketers, but analysts say in this war, labour, which in January led the strike against the removal of subsidy on petrol and backed the probe of the subsidy regime, has shown  its double face…

It has been one week of swordfight and horse-trading between the federal government and the National Union of Petroleum and Natural Gas Workers over subsidy payments to oil marketers. But who has emerged victorious from the battle of wits that pitted NUPENG and the oil marketers – some of who have fleeced the country and its people – against the government?

The answer seems to suggest itself after the horrible sights of vehicle queues at filling stations and stranded commuters in Abuja and its environs. NUPENG had suspended supply of petroleum products to the Federal Capital Territory owing to disagreements with the federal government over non-payment of subsidy to some oil marketers indicted for fraudulent practices. The union said about 15, 000 of its members, mainly tanker drivers, had not been paid by the oil marketing firms, who claimed they could not meet salary obligations due to cash shortages caused by government’s failure to pay their subsidy claims.

“The issue at stake is job security. We cannot fold our arms and see our members being thrown into the labour market,” said NUPENG President Igwe Achese. NUPENG threatened a nationwide strike, which the federal government dismissed as “cheap blackmail.”

“It is clear that those behind the strikes are marketers being investigated for possible fraud,” the Federal Ministry of Finance said in a statement in Abuja. “These elements have now resorted to hiding behind the unions to unnecessarily antagonise government and create hardship for Nigerians.” The duel continues, though, NUPENG called off its strike and resumed supply of petrol to Abuja on Friday.

But what are the points of divergence? When in January the federal government removed petrol subsidy, forcing up prices, the divergence of opinions between labour and civil society, on the one hand, and government, on the other, was of a cardinal nature. The federal government said the huge expenditure on subsidy was a drag on national resources that could not be sustained. More so, it alleged that the funds were actually subsidising corruption by a cabal of oil marketers at the expense of the masses. However, labour and civil society maintained that the masses could not be punished for the misdemeanour of the so-called cabal who the government had failed in its responsibility to tackle. Failure to find a middle ground between the federal government and labour led to a weeklong national strike, organised by the Nigerian Labour Congress and Trade Union Congress, with their civil society allies. After the strike, came the probe of the subsidy regime conducted by an ad-hoc committee of the House of Representatives headed by Hon. Farouk Lawan. The committee’s findings released in April indicted over 75 companies, including the Nigerian National Petroleum Corporation and Petroleum Products Pricing Regulatory Agency. It recommended that NNPC, PPPRA, and a number of oil marketing firms should refund to the federal government about N1.067 trillion being monies paid between 2009 and 2011 for products that were never supplied.

Though retrieval of the fraudulently collected subsidy funds and prosecution of those involved seems to be the point on which the whole country is united, the attempt to bring the indicted oil marketers to book has been immersed in serial controversy.

First, there is the bribery scandal involving Lawan. He is being accused by Chairman of Zenon Oil, one of the indicted firms, Mr. Femi Otedola, of receiving $620, 000 in underhand payments to alter the report of the House committee. The case, which, apparently, challenges the integrity of the House subsidy committee report, is still ongoing.

The Federal Ministry of Finance had also set up a committee headed by Mr. Aigboje Aig-Imoukhuede to review all subsidy claims and payments made in 2011. The technical committee in its report accused some oil marketers of collecting over N400 billion in subsidy payment without importing petroleum products into the country.

However, many of the oil marketers rejected the claims in the report and accused the committee of refusing to invite them or request necessary documents to facilitate its investigations before reaching the conclusions. To try to erase all doubts, President Jonathan on July 5 established another committee, also headed by Aig-Imoukhuede, to review the findings of the previous technical committee. The committee discovered some dubious subsidy claims made by oil marketers omitted in the Lawan report. It was the attempt to punish oil marketers whose indictments were confirmed by the Aig-Imoukhuede-led presidential committee that set NUPENG against the federal government. The Nigeria Labour Congress (NLC) backed labour in this fight, threatening to go on strike over the non-payment of subsidy claims to indicted oil marketers. The federal government says it has cleared about 31 oil marketers and paid out about N42 billion in petrol subsidy since April, but withheld payment to 25 marketers with serious infractions.

Between government and NUPENG observers believe one has embarked on a road that is erroneous. The preponderance of opinion seems to be that the decision to travel the road of confrontation with government over non-payment of subsidy to indicted marketers, chosen by the union, comes not only from bad taste, but also from a pretentious stance on the prosecution of the errant marketers. What is not in doubt is that last year was very unfortunate for Nigeria in terms of monies lost to fraudulent oil imports. The country paid about N2 trillion (about half of this year’s budget of N4.7 trillion) in fuel subsidy, from N631 billion paid in 2008, and N673 billion paid in 2010. This is, no doubt, unsustainable and most Nigerians would like their government to apprehend and punish those who have fleeced the country. This quest was the subtext of the labour strike in January. The question is-could NUPENG and others known to have backed the pursuit of transparency in the fuel subsidy management and prosecution of thieving oil marketers have changed between January and now?  The volteface by Labour, which in January led the strike against the removal of subsidy on petrol and backed the probe of the subsidy regime, but threatened to embark on strike over the non-payment of subsidy claims to the indicted oil marketers is disheartening, and shameful.

President of Trade Union Congress, Mr. Peter Esele, is quoted as saying, “The NUPENG strike in Abuja is shocking and disgraceful. I appeal to the government not to bow to this cheap blackmail. Everything must be done to ensure that every marketer that is found wanting is punished adequately and made to repay every kobo he has fraudulently taken from the Nigerian people.” The rather depressing thing about the standoff between NUPENG and the federal government is the inevitable portrayal of the labour movement in the country as an amalgam of persons keen on protecting their selfish interests at any cost, even if it means sacrificing the wellbeing of the great majority.  

But the federal government has also been criticised for taking some actions that seem to complicate the process of bringing the dishonest marketers to justice. The decision to appoint Aig-Imoukhuede to verify his own report, some insist, was a mistake.  Besides, some of the marketers have alleged that Aig-Imoukhuede’s verification process was fraught with gaffes. Among other things, the presidential committee was alleged to have almost entirely depended on the records of Lloyd Intelligence, a ship registration and tracking firm, for the confirmation of ships used in the fuel imports, as if Lloyd is a regulatory agency. Marketers whose imports were not confirmed by Lloyd were considered to have used dead ships for their transactions.

But Lloyd is not a regulatory agency. And marketers have said that only about 12, 000 of about 77, 000 vessels in operation worldwide are registered with Lloyd.

Besides, the marketers have argued that many of the oil shipments were commissioned by companies in the exporting countries whose records the Nigerian government has no access to. To address this issue, however, PPPRA has said it is now “mandatory for all oil trading companies supplying products to oil marketing companies in Nigeria to be pre-qualified and registered by the agency.”
The steps taken by the federal government and NUPENG are producing different results. It behoves them to ensure that they have one purpose: ridding Nigeria of the dubious reputation of being a country where corruption is subsidised at the expense of the people’s welfare.