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Deregulation and hypocrisy of labour leaders

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By Prince (Dr) Samuel Ibiyemi (Founding Publisher of Nigerian NewsDirect)

First Published: October 22, 2012

Inflated fuel price by marketers

It is disheartening that officials of the Nigeria Labour Congress (NLC) have refused to stop sales of Premium Motor Spirit (PMS) above the official price of N97/litre even though they embarked on nationwide strike which paralysed economic activities when President Goodluck Jonathan announced the removal of subsidy on January 2, 2012.

Equally, the Save Nigeria Group led by Pastor Tunde Bakare of Latter Rain Assembly till date has yet to criticise major and independent marketers or engage the Police to stop sales of PMS above the official pump price at filling stations located outside Lagos, Abuja and Port Harcourt. Both organisations are quite aware that these markets have been collecting fuel subsidy from the government and yet sell PMS above the official pump price. Can we call this unnecessary quiet position of these two groups as deliberate protection or support of their members to cheat both the government and motorists?

The exploitation through inflated price is responsible for excess supply of PMS diverted from Lagos by markets to states such as Ogun, Oyo and Edo among others, in order to take advantage of the opportunity to sell PMS above the official price without any form of resistance by the general public and caution by the Department of Petroleum Resources (DPR). It is with ease that Nigerians drive into filling stations of Major and Independent marketers in these states to buy PMS at N110 or even higher, with the exception of stations of Nigerian National Petroleum Corporation (NNPC) who still sell at N97 per litre. The ease of purchase implies that there is no need to make trouble because it takes almost an hour for a motorist to buy PMS at N97 per litre in any filling station in Lagos, Port Harcourt and Abuja, compared to the ease in buying at N110 per litre in other states. Is this the type of deregulation that the Nigerian Labour Congress (NLC) and Save Nigeria Group are willing to promote instead of allowing the government to introduce guided-deregulation and cancellation of fuel subsidy needed for developmental projects. This is indeed a challenge for security agencies and the DPR. Officials of the NLC who will fight the government to a stand still in order to frustrate introduction of deregulation and yet do nothing to stop marketers from selling at N110 or N120 per litre while still collecting subsidy.

In the last edition of Mr Critical, it was stated that the current fuel supply and distribution crisis that Nigerians are experiencing could be traced to recent vandalisation of products pipeline of the Pipeline and Product Marketing Company (PPMC) at Awepo in Ogun State. At some of the vandalised pipelines, FPMC Engineers who went for repairs were shot and three of them were confirmed dead. As a result of security challenges, PPMC is yet to gain access to the vandled points to effect repairs. The said post along the Atlas-line that feeds five (5) depots and accounts for products supply to the whole of the Southwest region and also contributes to about 60 percent of total bridging to the North. The failure of PPMC to carry out the repair has resulted in hoarding of PMS) by dealers who are union leaders, thereby bringing back long queues  in South Western States. Before this ugly incident, Nigerians had forgotten about the menace of fuel scarcity nationwide even during the protest that greeted subsidy removal in January this year.

Hence, one of the benefits of the aumert fuel supply hiccup in the country for petroleum marketers is the sales of PMS at prices that range between N110 and above per litre by both Major and Independent marketers. The inability of the DPR to effectively police distribution schedules in the downstream sector is also responsible for the inflated price.

Ownership of filling stations

Investigations conducted recently and presented by the Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN) Mr Obafemi Olaware during the probe of downstream activities by the Senate Committee on Downstream sector chaired by Senator Magnus Abe shows that labour union officials are receiving 70 per cent of PMS being allocated at each fuel depot whether privately owned depot or not It is clear from this data that labour union officials are not challenging the DPR and they are also not insisting on N97 per litre at stabons, because these stations are making money for them. Is this patriotism? how else will the union officials expect the government to do better when those that are expected to check the government are involved in round tripping of PMS distribution in the country? When workers of the PPMC threatened to embark on industrial action recently over the killings of their colleagues by vandals, what was the response of NLC officials? This is because when there is hiccup in distribution of PMS or kerosene, it creates an opportunity for their stations to earn cut-throat profit.

Finance Ministry

It is indeed hypocrisy also for the Finance Minister, Dr Ngozi Okonjo-Iweala to remain silent on the true position of available fund for the funding of fuel importation. Based on the N800billion earmarked in the 2012 budget and over N400bn already expended on payment of subsidy to marketers during the year it is clear that the amount left cannot be enough to finance subsidy payment for the remaining quarter of this year. From available records obtained from the PPPRA only 20 companies performed in the fuel importation allocation issued for the third quarter. Out of this number, only five of them imported more than 10 percent of the figure allocated to their companies. The inability of 39 companies appointed by the PPPRA to import fuel was based on the refusal of banks to finance them since they are aware that these importers may not refund loans until sometimes in June 2013 based on the current payment arrangement by the Finance Ministry.

Impact of subsidy probes

The series of probes by the House of Representatives, Senate and Aigboje Ag-Imolhuede committee resulted in long queues in city centres where only NNPC filling stations and few stations that can be controlled by the DPR are selling PMS at N97 per litre. Based on limited resources at the disposal of the federal government, long queues for fuel will persist because marketers are not importing fuel to avoid harassment by various probe committees.

According to the CEO of a prominent downstream firm, “Importation of PMS is a no go area for my company now in order to avoid further embarrassment by the National Assembly and the Finance Ministry, we have been spending so much time and resources on engagement of legal practitioners to clear the company’s name from the mess of fuel subsidy scandal.”

The CEO added that banks are also not willing to finance fuel importation due to the fact that importers will definitely default based on the current payment arrangement by the Ministry of Finance.

From all indications, the activities of the Finance Minister this year should be blamed for the long queues at filling stations. The new administration of PPPRA has done everything possible to address transparency issues through various checks put in place and reduction in the number of fuel importers.

The 42 oil marketers granted import permits in the first quarter of the year were mandated to import a total of 3.755 million tonnes of petrol, which is equivalent to 5.036 billion litres of petroleum products In the second quarter PPPRA Executive Secretary Mr Reginald Stanley reduced the volume to 3.575 million tonnes, equivalent of 4.794 billion litres, reflecting a drop of 180,000 metric tonnes or 241.38 million litres, Also, in the third quarter, 39 oil marketers were issued permits by the agency to import 3.125 million metric tonnes of fuel, an equivalent of 4.20 billion litres.

Hence stringent conditions being put in place by the Minister of Finance should be reviewed to enable marketers receive reimbursement early for volume of product imported and then make it possible for banks preferring short term lending to embrace fuel importation under the Petroleum Support Fund (PSF) Scheme.

Adoption of guided deregulation

As the fuel scarcity bites harder, aides of President Goodluck Jonathan should use this opportunity to enlighten Nigerians that labour unions mobilising various civil societies against fuel subsidy removal are greedy and self-centred. Nigerians were entertained and provided with food and drinks during the subsidy protest of Occupy Nigeria’ by Save Nigeria Group in collaboration with the NLC. Why is the labour not organising the same protest against filling stations owned by their members selling PMS at over N110 per litre? Why have they not sponsored miscreants to bum tyres and ask Nigerians to embark on strike to stop dealers from selling PMS at N100 per litre since they are still collecting subsidy and bridging claims?

Deregulation is the best option for now if the problem of downstream must become a thing of the past. The SURE Committee of Dr. Christopher Kolade should commence work and utilise proceeds from subsidy removal for funding of infrastructure like the success recorded by the Petroleum Trust Fund (PTF) put in place by late General Sanni Abacha. An economy in the hands of volatile workers unions will crumble, welfare of workers, situation whereby leadership of these workers unions become an instrument of destruction for opposition parties should be avoided. Guided deregulation with a measure of control by the PPPRA after the enactment of the Petroleum Industry Bill (PIB) by the National Assembly should be the most interesting issue for political and sincere labour leaders. Guided deregulation will allow revenue being wasted on few subsidy thieves to be utilised for development projects and genuine marketers will invest in refinery and fuel importation.

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3 injured as 2 armed drones from Lebanon explode in Israel

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Two unmanned aerial vehicles (UAVs) from Lebanon carrying explosives exploded in northern Israel on Tuesday, lightly injuring three people, Israeli authorities said, amid heightened tensions between Israel and Iran and its allies.

The Israeli military said in a statement that the armed drones crossed from Lebanon into Israeli territory and exploded in the area of Beit Hillel in the Galilee.

Three people sustained light injuries, Israel’s state-owned Kan reported.

The drones did not trigger air raid sirens, and the military said the incident was under review.

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CBN expresses commitment to harnessing digital technologies

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The Central Bank of Nigeria says it is committed to harnessing the power of digital technologies to enhance financial inclusion.

Mr Yemi Cardoso, CBN Governor, said this on Tuesday in Abuja, during a strategic institutions tour by participants of Senior Executive Course 46 of the National Institute of Policy and Strategic Studies (NIPSS).

Cardoso, who was represented by Dr Bala Bello, Deputy Governor, Corporate Services, said that digital technologies would also boost productivity and create an enabling environment for innovation and entrepreneurship to thrive.

According to him, the apex bank has already deployed robust digital technologies in driving most of its processes towards achieving optimal performance.

He said that NIPSS, as a foremost national policy think-tank, had made invaluable contributions to the socio-political and macroeconomic development of Nigeria.

“We are, therefore, not surprised at the apt and relevant choice of your research theme.

“The CBN and NIPSS have had a long-standing and robust working relationship since the establishment of the institute. This has culminated into positive mutual benefits for the two institutions.

“The CBN, on the one hand, has provided infrastructural support to the institute through construction of an auditorium and a hostel, in addition to the provision of technical support.

“On the other hand, NIPSS has supported the technical capacity of the CBN through the training of some personnel both at senior executive course level and intermediate course cadre,” he said.

The Director-General of NIPSS, Prof. Ayo Omotayo, said that the study visiting would be representing the institute in getting information from operators of the apex bank on the relevance of digital technology to developing jobs for Nigerian youths.

According to Omotayo, a lot of progress has been made globally in using digital systems to run the economy.

“The more of our activities that we can put in digital format, the more we get the opportunity of providing employment access to a whole lot of the 120 million active Nigerians.

“We at NIPSS always knock at the frontiers of knowledge, checking what is going to happen in the immediate future.

“We are working towards a system where we believe that almost every service can be delivered digitally,” he said.

The Acting Director, Monetary Policy Department of the CBN, Dr Lafi Bala Keffi, commended the NIPSS study group for its interest in the apex bank.

She urged the participants to explore the time-tested culture of NIPSS, which is to diagnose national, profer practical solutions and recommend ways of making such solutions realisable.

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NCAA suspends licences of 3 private jet owners

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Nigeria Civil Aviation Authority (NCAA) has suspended licences of three Permit for Non-Commercial Flight (PNCF), otherwise known as private jet owners, over alleged failure to comply with regulatory requirements.

Acting Director-General of NCAA, Capt. Chris Najomo, disclosed this to newsmen on Tuesday in Lagos.

Najomo said that after issuing a stern warning to the PNCFs in March, the authority deployed its men to monitor activities of private jet owners at airport terminals across the country.

He said that consequent upon the heightened surveillance, three private operators were found to have violated the annexure provisions of their PNCF and Part 9114 of the Nigeria Civil Aviation Regulations, 2023.

Najomo further stated that NCAA would be carrying out a re-evaluation of regulatory requirements compliance of all PNCFs owners within the next 72 hours.

This, he said, this was in line with the authority’s zero tolerance for violations of regulations.

“In line with our zero tolerance for violation of regulations, the authority has suspended the PNCF of these operators.

“To further sanitise the general aviation sector, I have directed that a re-evaluation of all holders of PNCF be carried out on or before April 19, to ascertain compliance with regulatory requirements.

“All PNCF holders will be required to submit relevant documents to the authority within the next 72 hours,” he said.
Najomo recalled that in 2023, the use of private jets for commercial purposes had gotten the attention of the Minister of Aviation and Aerospace Development, Mr Festus Keyamo (SAN), who issued marching orders for cessation of such acts.

He said that in March, NCAA issued a stern warning to holders of the permit for non-commercial flights, PNCF, against engaging in the carriage of passenger cargo or mail for hire and reward.

Najomo said that the riot act was also directed at existing Air Operator Certificate (AOC) holders who utilised aircraft listed on their PNCF for commercial charter operations.

“It must be emphasised that only the aircraft listed in the Operation Specifications of the AOC are authorised to be used in the provision of such charter services.

“Any of those AOC holders who wish to use the aircraft for charter operations must apply to the NCAA to delist the affected aircraft from the PNCF and include it into the AOC operations specification.

“NCAA wishes to reiterate to the travelling public not to patronise any airline charter operator who does not hold a valid AOC issued by the NCAA, when they wish to procure charter operation services,” he said.

The NCAA boss, thereafter, encouraged legitimate players in the aviation industry to promptly report such illegal activities to the authority for necessary action.

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