Hitherto , fuel subsidy payment in Nigeria used to shadow the international price of crude oil. Because we imported almost all our PMS , if oil price increased and our regulated local fuel pump price was held constant , then fuel subsidy increased to take up the slack. So, when Candidate Muhammadu Buhari made his famous “ anybody who says he is subsidising anything (fuel ) is a fraud ” speech , we thought that with his advent as President, the “ fraudulent ” and saprophytic fuel subsidy would be rested forever . Now fast forward to President Buhari. Fuel price increased from N 87 per litre to N 145 per litre . We were also told that the fuel subsidy which we said did not exist ( and was a fraud under the previous government ) had been removed . After which, we changed the terminology from fuel subsidy to under recovery . Following which we magically increased our fuel consumption from 30 million litres a day to about 65 million litres a day, and despite the aforementioned increased fuel pump price , we still managed to increase annual fuel subsidy ( which we previously claimed did not exist and was a monumental fraud ) to over N 1 . 5tn , which is more than 50 per cent of the Federal Government ’ s 2017 total revenue of N 2 . 65 tn, and circa N 500bn , more than what the previous administration paid despite higher oil prices and lower local pump price of PMS . Then , conveniently , under the either ignorant or malignant guise of a low Debt to GDP ratio , we ratcheted our debt service to N 1 . 82 tn, pushing our Debt Service to Government Revenue Ratio from 13 . 46 per cent in 2010 , 14 . 84 per cent in 2011 , 18 . 72 per cent in 2012 , 20 . 54 per cent in 2013 , 29 per cent in 2014 , 28 per cent in 2015 , then a geometric progression gallop to 66 per cent in 2016 , and 69 per cent in 2017 . We also magically increased recurrent expenditure from N 1 . 96 tn per annum under the previous administration to N 2 . 75 tn. And this was done without increasing minimum wage nor any major increase in the number of our circa 800 , 000 civil servants , totally against the grain of government ’ s constant news of weeding out scores of “ ghost workers” , plugging massive leakages , degrading corruption and over N 3tn savings from implementing the Treasury Single Account . It has been a wild ride so far . Interestingly, we can no longer blame a crash in oil price for our malaise. Crude oil is selling at about US$ 84 per barrel (averaged US $70 per barrel so far in 2018 ) . This is well above the US $ 50 . 50 per barrel budget oil price benchmark and by extension a US $ 52 . 40 per barrel spread compared to the budgeted US$ 18 . 10 per barrel spread ( US$ 31 . 60 production cost per barrel) . So , the question is , other than a shortfall in production (from the budget projected 2 . 1 million barrels a day to 1 . 7 million barrels a day) as noted by government , what happened to what should be a 300 per cent increase in expected oil revenue compared to projections which clearly cannot be explained by a 19 per cent shortfall in production ? Why is our oil revenue still short by circa 37 per cent ? Do you now understand why we are still borrowing ( particularly commercial debt ) like a drunken sailor ? And some say that our current problem is due to 16 years of an inept Peoples Democratic Party administration . Nigerians , “ Nos morituri te salutamus !”
"We who are about to die salute you !” Dr . Jekwu Ozoemene Port Harcourt , Rivers State
copied from Punch newspaper 12th Oct, 2018