Hoteliers, Tourism Operators Reject Electricity Tariff Hike


* Increase threatens millions of jobs in hospitality sector

By Emmanuel Addeh

Operators in the hospitality industry in the country, including hotel owners and tourism operators Friday rejected the September 2 electricity tariff hike by the federal government.

The industry players noted that they will be forced to lay off millions of workers who survive on the smooth working of the sector if the government does not reverse the increase.

In a joint press briefing in Abuja, the Federation of Tourism Associations of Nigeria, (FTAN), the Network for Electricity Consumers Advocacy of Nigeria (NECAN), Nigerian Hotels Association (NHA), Hotel Owners Forum, Abuja and Power Up Nigeria accused the government of relying on statistics provided by the Discos to inflict hardship on the country.

A statement signed by the Secretary, NECAN, Uket Obonga; President, FTAN, Alhaji Rabo Saleh; President, NHA, Patrick Anyanwu; and President, Hotel Owners Forum of Abuja, Dr Chike Ezeudeh, was read during the event.

The hospitality operators stressed that there was no consultation with them and wondered why the federal government hurriedly approved the increase as against the first quarter of 2021, which was agreed after the National Assembly intervened.

According to them, the increase in the tariff after over six months of not operating due to the lockdown was not only senseless, but smacked of insensitivity.

The joint statement read on their behalf by Obonga, stressed that many of the hotel and tourism centres will soon start shutting down and laying off workers because even as it is, there are no customers as a result of the issues with international flights and Covid-19 pandemic.

He said that while other countries like Ghana are looking for ways to bail out the sector in their countries, Nigeria was heaping additional burden on the businesses in the sector.

“The effect of the new tariff hike on business and the nation’s economy include business closures. Already, Nigeria hospitality and tourism industry is reeling and groaning under the weight of very high electricity bills, which they are struggling to settle every month.

“To increase the tariff, as it is now, will force many in the industry to close shop. One can only imagine the number of jobs that will be lost in the process; the fear is that many of such business at the micro, small and medium levels will be forced out of business.

“When businesses close shops, thousands of employees will be laid off, thereby worsening the unemployment situation in the country. There will be an increase in inflation; the fates of businesses are now in the hands of Discos,” the businessmen lamented.

They urged the federal government to listen to the cry of the people through different organisations and abolish the new billing regime.

In his comments, President, Hotel Owners Forum of Abuja, Ezeudeh, warned that hotels may embark on massive lay off which will worsen an already filled labour market.

“There is a direct implication of electricity tariff hike on us. I can tell you authoritatively that we are the largest employers of labour after government. We have a lot of workers under the hospitality industry in Nigeria.

“Due to this Covid-19, a lot of our workers were sent home, we are working with skeletal number of workers. Even when we were under Covid-19 lockdown, we were receiving bills from the Discos unlike other places outside Nigeria, like Ghana where they are trying to support some of these industries.

“The implication will be horrible because with that number of workers, and as second after government and again we will just close shop because we cannot afford to pay which is 100 per cent increase.

“Some hotels in Abuja pay N57 million every month; some N2 million, N5 million and the least is N500,000, and some of us are not operating fully, while some are closed,” he lamented.

According to him, “If you are in business and you cannot afford to pay, you lay off your workers. The impact is monumental and the government will create more problems including unemployment, insecurity and others.

“In Abuja here, we have about 1,200 hotels and we are employing over 90,000, you can imagine the impact it is going to have on Abuja alone if we close shop and throw some of these people into the labour market.”

President, FTAN, Saleh, in his remarks, said that the move by the government was not only badly timed but also insensitive.

“If you want to increase electricity tariff, this is not the time to do that because you have to take into consideration how it affects the citizenry.

“Therefore, as people and organisations, we will keep pushing and complaining until the right thing is done, and we will not keep quiet,” he vowed.

The operators maintained that the federal government had allowed itself to be misled into believing erroneously that tariff increase is the silver bullet, whereas the root cause of the liquidity problem in the sector remains unattended to.

They argued that the past reviews did not yield the desired result, saying that the incessant request for tariff hike was becoming unbearable.

“We therefore wish to state categorically that we reject the September 1st 2020 tariff increase as ordered by NERC.

“We call on the federal government to rescind the increase because we note that there is nothing put on ground to cushion the effect of the dual increase of the end user tariff and the pump price of petrol,” the industry operators said.