The Federal Government is yet to decide the take-off date for the removal of petroleum subsidy in the country, Minister of Information, Labaran Maku, has said.
Contrary to recent reports that the government has fixed April 1 for the commencement of the policy implementation, the Minister said at the end of the weekly Federal Executive Council (FEC) meeting in Abuja that that reports credited to the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC), Austen Oniwon , that subsidy regime ends in December 2011, was misconstrued.
According to Mr. Maku, President Goodluck Jonathan was still dialoguing with various stakeholders in the country on the issue and is yet to fix the effective take-off date for the removal of subsidy in the distribution of petroleum products.
Minister of Finance and Coordinating Minister for the economy, Ngozi Okonjo-Iweala, had last week declared that the president, who is the only person with the authority to make a categorical pronouncement on the commencement date for the policy, was till consulting and would speak on the date at the appropriate time.
Mr. Maku, who was addressing reporters in the company of the Minister of State, Finance, Yerima Ngama, said such pronouncement would only be made when government completed the ongoing consultations and dialogue with different groups to ensure proper understanding of the issues at stake.
“No take-off date for subsidy removal has been announced by government yet,” Mr. Maku said. “The truth of the matter is that our country is presently in a very difficult economic situation. To continue to run the economy with one third of the budget set aside to subsidize one product absolutely puts the country in a path to a greater difficulty for the economy. We have to continue talking about this because every sector the government opened up has produced results.
The minister restated the benefits of the deregulation policy, citing example of the situation in the broadcasting and communications sectors of the economy, pointing out that critics, who talk emotionally about it, were not actually addressing what the government is out to achieve.
“Let’s take the media, for instance, before now it was only the Nigerian Television Authority (NTA) and Federal Radio Corporation of Nigerian (FRCN), until government deregulated broadcasting in the country. Before then, one could not set up a private radio or television station in this country. But, when government deregulated the sector, what do we have today? We have private television stations that are now competing with NTA and FRCN. If government decided to control broadcasting in the country, all journalists would have been out of job,” the minister noted.
He also drew attention to the situation in cement production, banking, aviation and telecommunications sectors, saying that unless the country does not want to develop and move forward, it would be ignoring the deregulation of the vital sectors of the economy at its own peril.
On the country’s increasing domestic debt put at over N500billion, the minister said the removal of fuel subsidy was inevitable, adding that Nigeria stands the risk of running into economic crisis if it fails to deregulate the oil and gas sector.
Mr. Maku bemoaned the country’s inability to derive sufficient benefit from the operations of the petroleum sector after over 33 years of investments, pointing out if government had wasted time in the past, the time is now for it to take the vital decision to move the economy forward.
“No leader in the world would want to punish its citizens. The future holds promises because there is no sector that government has deregulated that has not succeeded. This is the path to growth, development and opportunity. This is the way to go”, the minister said.
He lamented that Nigeria was the only country in the world with the level of oil and gas resources the country is endowed with and failed to deregulate the sector, urging Nigerians to bear with the government over its decision to deregulate the sector.
“We are urging Nigerians to take a harder look at what the government has proposed. It will save Nigeria. It will create jobs and investment opportunities. We are calling for understanding on this issue given the budgetary constraints.”
On other decisions reached during meeting presided over by President Goodluck Jonathan, Mr. Ngama said approval was given for the release of $8.804million for payment for the full subscription of 62,000 units of shares allotted to the Federal Government in the African Reinsurance Corporation.
Approval was also granted for the award of the contract for the construction of gas supply pipeline for the the Alaoji power plant and a N2.6billion in addition to $8.3million, which is equivalent to N3.8billion billion plus five percent value added tax (VAT) of N190.8million