Prof. Aminu, subsidy and Abacha
A former Petroleum Resources Minister, Professor Jibril Aminu, recently told a national daily that the government should try to copy the example of the late General Abacha regime by using proceeds of subsidy withdrawal for the purposes they are intended. He was quoted as saying: “I believe that in the Abacha days, they found some […]
A former Petroleum Resources Minister, Professor Jibril Aminu, recently told a national daily that the government should try to copy the example of the late General Abacha regime by using proceeds of subsidy withdrawal for the purposes they are intended. He was quoted as saying: “I believe that in the Abacha days, they found some answers to this problem by withdrawing the subsidy and taking the money, saving it and using it on development activities, which the people could see. That was the difference the PTF made. (Daily Sun Wed. Nov. 2, 2011).
Senator Aminu is an expert on this issue because he once headed the Ministry of Petroleum Resources. And the fact that he served under a different administration but still acknowledged the success story of the late Abacha in managing the proceeds of subsidy withdrawal is a significant revelation. Governance is about sincerity. Those who advocated the scrapping of the PTF after Obasanjo became President in 1999 did so for selfish reasons. And these selfish reasons did not allow them to examine the bigger picture of public interest, which they were determined to harm.
One of the self-serving reasons they advanced for the dissolution of the PTF was that it was operating like a government within a government. Enemies of PTF are corrupt bureaucrats and politicians who did not want the policy of strict transparency that surrounded the operations of the defunct trust fund. Deliberate inflation of contract costs for personal gains and compromising standards are the common practices in the ministries and government departments. With the creation of the PTF, these corrupt officials felt uncomfortable because the conduit pipe through which they were siphoning public funds had been blocked.
Consequently, they started a campaign against the PTF, meeting the two main presidential candidates in 1999, General Obasanjo (PDP) and Chief Olu Falae (then of APP/AD alliance), to warn them about the “dangers” of retaining the PTF. They argued so persuasively but fraudulently that the PTF would make the government irrelevant. Unfortunately, without any deep and cool-headed examination of the arguments for and against, both Obasanjo and Falae announced their intention to do away with PTF once elected. At the end, Obasanjo of the PDP was elected President and one of his first major policy announcements was the dissolution of the PTF, despite achieving remarkable results with only N60 billion allocation throughout its entire life.
With the PTF dissolved, Nigerians would have expected better results in the management of subsidy withdrawal proceeds by the Obasanjo administration. But until he left office eight years after, Nigerians could not concretely point to anything as evidence where these proceeds were invested. In 2001, the Federal Ministry of Works alone received N350 billion as allocation but the conditions of federal roads continued to deteriorate. In fact, at one point, former President Obasanjo publicly acknowledged that he was ashamed of the conditions of federal roads!
In contrast, with only N60 billion allocation throughout its entire life, the PTF had something to show for that allocation. Many advocates for the dissolution of the PTF were forced to bury their heads in shame. Subsidy proceeds can never produce results because of the stubborn cancer of corruption that eats deeply in the public service and the minds of political leaders. With the dominant influence of corruption, the benefits could only go to a few individuals.
Therefore, the biggest challenge for the Jonathan administration in the current decision to remove petroleum subsidy is winning back public confidence. Indeed, the failure of the past administrations, especially from 1999 to 2007, to justify the arguments for subsidy withdrawal, may have largely contributed to the current public hostility to the latest attempt by President Jonathan to subject Nigerians to the inconvenience of another subsidy withdrawal. Although the former Obasanjo administration removed subsidy more frequently than any administration, Nigerians did not ultimately experienced the benefits that the government promised subsidy removal could bring.
Haunted by this unpleasant experience of disappointment, Nigerians are now not ready to believe the Jonathan administration that subsidy withdrawal could be beneficial to them. Grandiose but non-priority projects, plus massive corruption, are the main stumbling blocks to any effective management of the proceeds of subsidy withdrawal. Public support is essential for the successful implementation of any government policy. The real snag, however, is that the people are finding it difficult to trust their government in making subsidy withdrawal work to their ultimate advantage.
During the Abacha administration, Nigerians witnessed tangible and remarkable improvements in infrastructure, roads, hospitals, schools, water supply and other critical areas of social services. The defunct Petroleum Trust Fund, PTF remains a reference point of how to make subsidy withdrawal work to the people’s advantage. Unfortunately, the success story of PTF was killed merely on sentiments because former President Obasanjo couldn’t afford to see any Abacha legacy survive, no matter how beneficial it was to Nigerians. Even the railway rehabilitation and modernization projects started by Abacha were frustrated by Obasanjo. Shamelessly, towards the end of his tenure, he re-introduced the same railway projects he abandoned. The success of subsidy withdrawal depends on the sincerity of the government to apply the proceeds to the benefit of the people. Despite raising the fuel price to N75 per litre, the former President Obasanjo administration didn’t reward the sacrifices he expected Nigerians to make for subsidy withdrawal in return for better quality services. This experience is the core factor in the current hostile public attitude to another subsidy withdrawal by President Jonathan.
Zogirma wrote from 62, Old Karu, Abuja.