edoyad:

@ekt bear you're missing the point. The OP is trying to highlight the hypocrisy of Nigerian politicians as exemplified by el slime rufai.

Former Federal Capital City , FCT, Minister, Mallam Nasir el-Rufai at a forum organized by NERC urged the electricity regulatory body to insist on "eye-catching" tariff that would attract direct foreign investment. He suggested that electricity tariffs need to go up by between 300 and 400 per cent to attract investors into the power sector and provide adequate electricity to Nigerian populace.[size=20pt] He advised NERC to "do that which is needful by having the courage to increase the tariff irrespective of how politically incorrect it might be.[/size]" Recall recent revelations that el-Rufai was at the helm of affairs at the Bureau for Public Enterprise, BPE, that mismanaged the privatization programme.

The removal of fuel subsidy was greeted with mixed feelings. How do you see the action of President Goodluck Jonathan?

Well, I have already written about this fuel subsidy conundrum and I think that the timing and the deceit that went around the removal of the fuel subsidy is the main reason people are angry. I[b] think the government has missed the point[/b] of peoples’ anger about the fuel subsidy. It is not an economic argument; it is not a political argument because some of the people in government are accusing some of us in the opposition of being opposed to it for political reasons. It is more than that. It is a trust issue. Nigerians do not trust this government to use the resources well and there is nothing the government can do to earn that trust unless they get the work of the people done. This government has earned $200 billion from the sale of crude oil and taxes in the last four years and it has done nothing with it. Why would another $7 billion make the difference?

[size=14pt]He advised NERC to "do that which is needful by having the courage to increase the tariff irrespective of how politically incorrect it might be[/size]

ekt_bear:

I also question this premise that the arguments for the removal of fuel subsidy are exactly the same as that of the removal of electricity tariff.

Whether you subsidize oil or not, people will be able to get oil at market prices, right? Worst case I buy it from some black market dealers somewhere at slightly more than market rates. Or if not PMS, there are affordable substitutes like diesel. And the damage to the Nigerian economy is basically capped at whatever the Nigerian government spends per year on subsidy. $7-8 billion.

However, for the electricity market? Well, the end result of the current tarriff regime is no affordable electricity in Nigeria, period. You get light for 4 hours a day, and for the other 20 hours a day you are generating electricity from a generator. So the end result is that you pay more for electricity overall in Nigeria than in places where it is deregulated (you probably pay 2X or 3X of what some guy in the western world pays.)

There is no black market dealer I can get electricity from at a reasonable price.

So my business that depends on PMS will survive whether there is a subsidy or not. But if my business depends on electricity, I am absolutely screwed. . . my factory in Nigeria can never compete against one based in Brazil, the US, China, etc.

The overall impact of lack of electricity on the economy is larger than the impact of the fuel subsidy.

I do agree that if one supports the removal of the electricity tariff regime, you should also logically support the removal of the fuel subsidy. But the impact of the two is not the same, and the way they damage the economy isn't the same.

ekt_bear:

He is only a hypocrite if you boil down his arguments to that sentence.

If he is asking for a slowed increase of the subsidy (say over a 3-4 year period), is he then a hypocrite?

If he wants the subsidy removal matched by reduction of the costs of government (74% recurrent expenditure), he is still a hypocrite?

If he wants some accountability for where the money was spend over the past several years before the subsidy is removed (literally billions of dollars gone), is he still a hypocrite?

I do not think the three above requests are unreasonable or hypocritical.

You and jmaine have either missed his points entirely, or are purposefully distorting what he is saying.

Remii:

If electricity is improved, yes, price increased of 100 - 200% is okay, provided you use prepaid meter.  I use N5000 worth of units card for more than a month when PHCN gives about 18 hrs daily average supply. The cost to fill about 6hrs average amount to about N30,000 per month, so for me paying N15,000 per month for 24hrs light is good deal.

muami:

Did yoy see/hear him suggest similar measures to NERC before they can increase tariff?

ekt_bear:

Well, let me quote the man himself:
http://www.sunnewsonline.com/webpages/news/national/2012/jan/08/national-08-01-2012-005.html


Now, is it crystal clear why he is not a hypocrite? No doubt he agrees 100% with the economic argument. But the other aspects, he doesn't.

Just because you think it makes economic sense to remove the fuel subsidy [size=14pt]doesn't mean you'll support its removal if you don't have any faith in the FG to do anything better with the money.[/size]

Hell, when we first discussed this issue 9 or 10 months ago, I think everyone agreed with the economic part. [size=14pt]But they didn't necessarily think it a good idea to remove the subsidy, due to lack of trust in the government.[/size]

[size=14pt]He advised NERC to "do that which is needful by having the courage to increase the tariff irrespective of how politically incorrect it might be[/size]