Excellent analysis

Nigerian unions may have agreed to suspend strike action and call off protests after the government partially caved into demands for the restoration of the longstanding fuel subsidy. But President Goodluck Jonathan is not out of the woods yet.

One unintended consequence of his ineptly-handled decision to remove the subsidy (before persuading the public that he can deliver improved services and better livelihoods), has been to galvanise Nigerians into taking issue with a far broader range of wasteful government habits.

The most egregious of these are now all over Nigerian websites, black berry messenger groups and twitter feeds together with detailed examination of the 2012 budget. The public is taking issue with everything from the president’s food allowance and government travel budgets to the cost of planting shrubs at the Aso rock presidential villa in Abuja.

Civil society groups are also demanding an account of how the fuel subsidy more than doubled last year to a staggering $8bn, without there being a corresponding increase in petroleum products on the market. They want punitive action taken against those fuel importers and officials found to have fleeced the public purse.

Diezani Alison-Madueke, the petroleum minister, pledged a review on Sunday night. If this is conducted properly it could be very uncomfortable both for her and for Mr Jonathan. It would likely expose closely-associated officials and businesspeople – some of them contributors to the ruling People’s Democratic Party election campaigns last year.

The lifting of the fuel subsidy has caused an eruption of anger because it has forced the price of transport and food up and hit the poor in their pocket. But it has also infuriated the public because of the perception that the very people who abused it last year for their own ends are now forcing the public to pay the cost.

Western economists such as Paul Collier writing in the FT and Jeffrey Sachs in the NYT, who leapt in to defend the economic logic of removing the subsidy seem to have misunderstood the nature of the debate and misread the public mood.

http://blogs.ft.com/the-world/2012/01/nigerian-subsidy-crisis-opens-window-of-opportunity/#ixzz1je4H162C

Did the NLC and Civil Society groups got all the items listed below? How come no one is talking about the outcome of these demands

The protests gathered momentum, and paralysed the economy not just because of the rise in petrol prices but because of a much broader impatience with government corruption and waste. Below are just a few of the demands made in a draft charter written at the weekend by Civil Society groups, including Occupy Nigeria which has been at the forefront of protests, demanding more comprehensive reform:

[list]
[li]A return to the pump price for petrol of N65. [/li]
[li]Independent investigation, publication and prosecution of the N1.6 trillion ($992bn) payment for petroleum subsidy in 2011, and recovery of at least N1 trillion suspected to be fraud. [/li]
[li]Negotiate with all stakeholders a roadmap for the full deregulation of the downstream oil and gas sector with clear timelines.[/li]
[li]Enact the original, undiluted version of the Petroleum Industry Bill into law within 3 months.[/li]
[li]Explain how the N1.1 trillion deficit in the budget will be financed.[/li]
[li]Reduce the National Assembly budget of N159 billion to not more than N50 billion[/li]
[li]Eliminate or reduce wasteful spending proposals on various security votes, welfare packages, food, vehicles, furniture, software, research and development, travel, etc.[/li]
[li]Reduce recurrent portion of the overall budget to not more than 60%.[/li]
[li]The voluntary donation of 50% of the salaries and allowances of all political office holders in the executive and legislative branches of the government[/li]
[li]Reduction in the number of ministers to 37 – one for each state and the FCT.[/li]

[/list]

Mr Jonathan has been wrong-footed by the unions and his credibility as a champion of the “common man” substantially damaged. But if he is serious about the “transformation” he promised in last year’s election campaigns, he now has a platform to push it through. Nigerians have been united, in a way not seen the dark days of military rule in the 1990s, into demanding more accountable and effective government.

“My worry is that they are not really ready to do all these things they are now saying they are going to do. But they are going to be under a lot of pressure,” says a consultant close to government.