₦airaland Forum

menzo4u:
But you said no "plans" and I just showed you the "plans".

menzo4u:
It is without doubt, the fountain of Nigeria's wealth, it is indeed an enviable blessing to have it in our dear nation, I am referring to nothing but the Premium Motor Spirit (PMS) which synonymously translates to fossil fuel or petrol.

Before taking the driver's seat on today's subject of discourse, my unreserved salutation goes to the committed orgainisers of this debate, the credible judges, intelligent debaters, and the ever-following audience. I am Jimoh Ahmed Temitope, menzo4u by moniker, representing the prestigious Yaba College of Technology, Yabatech.

Fuel Subsidy, according freedictionary.com, is a monetary assistance granted by a government to a person or group in support of an enterprise regarded as being in the public interest.
In layman's view, which I term the "bricklayer's explanation", there is a certain amount of money that the government is paying to some people known as "Oil Marketers", as a form of assistance for them to reduce the cost of the burden of oil importation on them, they are paid a certain amount of money, when this payment is made, it is called "fuel subsidy".

So the topic is simply asking this question, “the government has decided to stop paying this money (fuel subsidy). Is it a justified action?". To this, I say "yes".

First and foremost, you will agree with me that the scam, called subsidy should not in anyway be given any consideration in the dictionary of Nigeria. None of the major sectors is practically working in the country, the education sector is screaming for help, the value of our currency is bleeding to death, the health sector is nothing to write home about. So it is definitely justifiable for the government to stop, remove, or eliminate fuel subsidy in order to use the money generated to revive the major sectors of the economy.

In addition, according to a news report on DailyTrust (December 15, 2015), the current Minster of State for Petroleum Resources, Dr. Ibe Kachikwu, affirms that Nigeria spent N1Trillion on fuel subsidy in 2015 alone, which is more than the nation's total budget for two years on other important sectors of the economy. Imagine the economic benefit Nigerians stand to gain if this huge sum of money was channeled into the non-oil sector.

Furthermore, by re-investing the money generated from the removal of fuel subsidy into an important sector like the agricultural sector (for instance), this will not only boost the country's Gross Domestic Product (GDP) but also be a saviour to our fast depreciating currency.

So far, I have come to the realization that Nigeria can be compared to a recharge card seller who has a damaged printing machine (for printing recharge cards), but instead of repairing it, he prefers patronizing another firm for the printing, and thereby losing a huge part of his profit to another organisation. Such is the case of my dear nation, Nigeria has a total of four refineries which can be repaired and effectively maintained to refine crude and produce oil locally. Why is it then justifiable for the government to be paying some so called oil marketers instead of bringing our refineries back to life?

More so, the benefits Nigerians stand to gain from fuel subsidy removal is enormous, there will be more concentration on diversifying the economy, more financial resources will be channeled on infrastructural development, creation of employment through industrialisation, and servicing the country's debt among other merits.

My opponent may argue that the removal of fuel subsidy will bring about increase in pump price of fuel, and this will bring about economic austerity on the citizens. I strongly believe that as lovers of Nigeria, we must be ready to make necessary sacrifices for the development of our motherland, the assumed "austerity" will definitely be a temporary one, that is, if at all the global prices of oil go high. I agree with J.M Bark on this quote, “you can have anything in life if you can sacrifice everything else for it". Sacrifice is part of life.

My opponent may also want to find leverage in saying that corruption and mismanagement of fund will greet the money generated from the removal of fuel subsidy, but I strongly believe in the present administration's stance against corruption, as this is vividly evident in the way it has been tackled with high level of gravity so far.
With Mrs Kemi Adeosun as the "striking" finance minister, Dr. Ibe Kachikwu as the "defensive midfielder" in the petroleum ministry, and president Muhammadu Buhari as the "coaching" president in the country, and Mr. Ibrahim Magu of the Economic and Financial Crimes Commission (EFCC) as the watchdog, the case of corruption will be drastically reduced if not completely eliminated.

In conclusion, the failure or success of the future of our country depends on the actions we take today, and posterity will judge us for it. On this note, as a proud ambassador of this country, having seen the pending benefits that the masses stand to gain from the removal of fuel subsidy, I say boldly and firmly that it is completely justified. Thanks.

Reference:
Definition of Subsidy
http://www.thefreedictionary.com/Fuel+subsidy

J.M Bark's quote
http://www.goodreads.com/quotes/tag/sacrifice

Mr. Ibe Kachikwu on fuel subsidy
http://www.dailytrust.com.ng/news/general/nigeria-spends-n1tr-on-fuel-subsidy-in-2015-kachikwu/124416.html

mooremadu:
why dont we have private schools participating in this debate? this is another form of marginalization. pls the coordinator should address this in subsequent online debates.

best regards

mooremadu:
why dont we have private schools participating in this debate? this is another form of marginalization. pls the coordinator should address this in subsequent online debates.

best regards

luxanne:
Well done debaters. You all performed greatly and very prompt.


Results are being compiled and will be posted shortly.

Thank you

Menzo4u, Betacitizen, Noskyboy, ObiZEAL

betacitizen:
The best way to learn in life is to get information from those who are already experienced, this is why, on this note, I shall start this debate by quoting an erudite Chief Economist, Razia Khan, she said," the reasons for fuel subsidy and its economic effect is regressive". Can we agree to this quote? Well, this question shall be answered in the course of this educating debate.

The chairman, independent judges, great coordinators, fellow debaters of high intellectual quotient, and the ever-following audience, I extend my humble greetings to you all. I am betacitizen, the second representative of Yaba College of Technology, Yabatech. The topic before me says as quoted, "Is the removal of fuel subsidy justified in Nigeria?". I debate to support the notion by saying "yes".

According to Collins Dictionary of Economics, subsidy is the money paid by the government in order to help an industry or business, or to pay for public service. So, fuel subsidy is the monetary supports rendered by the government in order to pay oil marketers so as to reduce the amount of money paid by the public for the purchase of fuel or petroleum-related products.

It is an undeniable fact that the payment of fuel subsidy has in recent years brought nothing but an untold economic hardship and adversity into our dear nation. How can we best describe a situation where about 20% of our national budget goes into the hands of a few "cabal", leaving the rich getting richer, and the poor getting poorer? The poor masses are really the ones who suffer the economic devastating effect of the fuel subsidy. For example, the money that is supposed to be channeled towards educational development, improvement of health system, and drastic development of infrastructural facilities is used to pay for the scam called subsidy. All these are less of a burden to the rich because their children hardly school in Nigeria, and they merely use those "general" hospitals, so, the poor masses suffer more.

In general perspective, the removal of fuel subsidy is a necessary economic austerity that must be given a consideration in the country in order to put us on our toes as a nation. Continuous payment of fuel subsidy will only increase our level of dependency on oil importation rather than look inwards on revamping our "dying" or "dead" refineries. But in actual sense, at this period when the price of oil has drastically fallen in the global market, Nigerians will hardly feel any sharp increase in petroleum pump price or direct increase in the prices of goods and services as witnessed in the previous administration. The International Bank for Reconstruction and Development (World Bank) also gave credence to this through her leading Economist, Mr. Litwack, by telling President Muhammadu Buhari that the best time to remove fuel subsidy is now.

In addition, the removal of fuel subsidy will also enable the government to create room for diversification of the economy which is a very important recipe for the growth and development of a developing country like Nigeria. According to the Nations Encyclopedia, the agricultural sector alone has the tendency to employ 70% of the country's labour force. This will not only put food on the table of the common man, but will also bring about a boost in the country's Gross Domestic Product (GDP).

Furthermore, a flashback to the administration of former president Goodluck Ebele Jonathan shows a genuine beauty in the removal fuel subsidy through the introduction of the Subsidy Re-investment Program (SURE-P), but if not for the fact that the whole process was battered by the high rate of corruption and favoritism in selecting those who benefit from it, the program would have been the best thing that would have happen to Nigeria. Now, the question is, will the same issue of corruption and mismanagement not resurface in the present day government as fuel subsidy is removed? No, because there is a huge sign of seriousness in the way the government is tackling corruption, therefore, corruption will not be a hindrance.

In comparison, a glance through the world to examine or view countries which have already followed the trend as far as the removal of fuel subsidy is concerned will definitely be enough to convince any right-thinking Nigerian that the action taken by the government to remove subsidy is indeed a justified one. Developed and developing countries like India, the United Arab Emirates, Cameroun, Egypt, and Ghana have already followed suit.

In conclusion, I fervently believe in the mantra which says, “Rome was not built in a day". So, if we must truly build a Nigeria that is even better than the ironic Rome, the removal of fuel subsidy is the first step in the right direction, therefore, it is definitely justified. Thanks.

Reference:

Razar Khan on fuel subsidy
http://www.thisdaylive.com/articles/khan-nigerias-fuel-subsidy-policy-is-regressive/209142/

Definition of subsidy
http://www.collinsdictionary.com/dictionary/english/subsidy?showCookiePolicy=true

http://www.nationsencyclopedia.com/Africa/Nigeria-AGRICULTURE.html

Percentage of Nigeria's budget on fuel subsidy
http://www.vanguardngr.com/2015/05/why-fuel-subsidy-must-go-2/

World Bank tells Buhari to remove fuel subsidy
http://www.premiumtimesng.com/business/194818-fuel-subsidy-removal-now-is-best-time-to-act-world-bank-tells-buhari.html

tommytlj4u:
@ Luxanne, wen is d next stage coming up? n wts d topic so dt we can get along as well.

noskyboy:
Good evening noble organizers and moderators of this debate, respected judges, co-debaters and all nairalanders. I am noskyboy, representing the University of JOS. Before delving into defending our position on this topic, I would like to create a background understanding on the key concepts and issues involved.
Subsidy in general terms is a form of financial aid or support provided mostly by the government to an economic sector, institution, business or individual. Therefore it is a measure adopted by certain governments to keep the price consumers pay for certain good or service below market levels; in other cases it may be directed towards producers to reduce cost of production.
Nigeria is one of the largest producers and exporters of crude oil, but she imports majority of the refined petroleum products consumed by Nigerians, mainly because of her inability to refine her own crude oil due to breakdown of its refineries due to lack of maintenance and mismanagement. From the 1980s to late 2015 premium motor spirit (PMS) or fuel was subsidized by the government in order to stabilize and reduce the price burden of the product on Nigerians, as such the government paid importers of petroleum products part of the money spent on importing the product, this is in order to aid even the poorest of Nigerians access fuel, The current administration has announced the removal of fuel subsidy, thereby leaving Nigerians to bear all the burden of purchasing this essential product. The question therefore remains can the removal of fuel subsidy in Nigeria be justified?
My answer is NO. In order to back my position, I would start by discrediting the reasons the government has provided for this act. In 2012 the administration of Goodluck Jonathan attempted a total removal of fuel subsidy claiming that a “cabal” is benefiting from fuel subsidy rather than Nigerians and also fuel subsidy is too expensive for the government, therefore fuel subsidy should be removed. The current administration is also singing same tune as their reason for removal of fuel subsidy, according to Kachikwu the minister of state for petroleum “we can’t even understand where those subsidies were going to. There are a lot of fraud elements in it so we need to cut it off” he also said that the earnings of the government have dropped due to fall in oil price, he proposed a price modulation scheme which would keep fuel prices below the current #85 per liter, despite removal of subsidy.
The above reasons provided, can in no way justify removal of fuel subsidy in Nigeria, because firstly; it is the duty of the government to make sure all ‘fraud elements’ are removed and the gains of the subsidy reach Nigerians, does it mean that a group of individuals are bigger than the government?, should Nigerians be left at the mercy of exploitative capitalists?.
Secondly; Nigeria is rich enough to subsidize fuel and still improve critical infrastructure and fund other developmental projects, but this is not the case mainly because of mismanagement, too much economic loop holes, policies that encourage wastage, extravagant spending on salaries and allowances of executives and legislators, embezzlement of public funds due to corruption; according to transparency international (2015), Nigeria has lost over $400 billion to corruption. Also states don’t look inwards to focus on agriculture and other natural resources and they don’t generate internal revenue, but rely on federal government. If these things are fixed, there won’t be need to remove subsidy.
Thirdly; the price of an important commodity like PMS should never be left to be determined by market forces (demand and supply) in a developing economy like that of Nigeria, because only the close friends of the government and the rich can afford licenses to run refineries or import fuel, therefore there won’t be competition and poor Nigerians would be placed in the hands of a few capitalists who are profit hungry. The price modulation scheme is just an opportunist and escapist solution, because it coincides with a period of global oil price fall, therefore Nigerians won’t feel the pinch now, but when prices go up again, Nigerians would be paying high, therefore such scheme is not sustainable on the long run.
Furthermore, Fuel subsidy removal in Nigeria cannot be economically, sociologically and even politically justified;
Economically; the removal of fuel subsidy in Nigeria cannot be justified, because such decision would have an adverse multiplier effect on the economy on a long run, it will lead to the increase in prices of everything, from transportation to cost of running businesses especially small businesses which would increase prices of food and other services and goods.
Sociologically; the structure of Nigeria is one characterized by wide spread poverty, social inequality and corruption in government, the question is, how sure are we that the government would reinvest the subsidy for the development of Nigeria? Past records have pointed otherwise. Therefore removing the only sure social service, Nigerians get from government is an anti-social welfare move; because education, security, clean water, stable power supply and food are things the government doesn’t provide for Nigerians, as such the rich and political class rather gets more to steal from and the poor are left un-catered for.
Politically; Nigeria is a democratic state, this means the people are the center of the government, and their will should be done. Removal and attempt to remove fuel subsidy has been met with disapproval and street protests in the past. Some Nigerians have recently used social media to register their dismay, also the NLC recently condemned such move, therefore it is politically un-justifiable to remove fuel subsidy in Nigeria amidst such disapproval.
In conclusion, Nigerians may not be feeling the full adverse effects of the fuel subsidy removal at the moment, due to global fall in oil price but when the prices eventually go up again Nigerians would be left to suffer with no visible palliative measures in place to ensure soft landing.
Word count: 990
References
Akinwale Y et al. 2012. Political economy of phasing out fuel subsidy in Nigeria. Scientific and academic publishing retrieved from http://article.sapub.org/10.5923.j.ep.20130304.01.html
http://scannewsnigeria.com/featured-post/nigeria-has-lost-over-400billion-oil-revenue-since-independence-says-ezekwesili/
Moyo N and Songwe V. 2012. Removal of fuel subsidy in Nigeria an economic necessity and a political dilemma. Retrieved from http://www.brookings.edu/research/opinions/2012/01/10-fuel-subsidies-nigeria-songwe
Nigeria: fuel subsidy: A desktop study by the center for public policy alternatives. Retrieved from https://toluogunlesi.files./2012/01/fuel-subsidy-desktop-study-report-copy1.pdf
Premium times report, December 26, 2015 - Nigeria scraps fuel subsidy, cuts petrol price to N85 per litre. Retrieved from http://www.premiumtimesng.com/business/195743-nigeria-scraps-fuel-subsidy-cuts-petrol-price-to-n85-per-litre.html
Nigeria: benefits and risks of fuel price modulation. Retrieved from http://allafrica.com/stories/201601042261.html

obiZEAL:
Good evening equitable judges, hardworking coordinators, fellow debaters and all knowledge seeking Nairalanders, I also want to send my unreserved appreciation to the creator of

this forum, Mr. Seun Osewa, whose ingenuity has provided us with this platform to debate on pertinent issues surrounding our country’s development.

My Name is ObiZEAL and I am representing the noble students of UNIVERSITY OF JOS, my colleague and I will be answering the question; Is (the removal of fuel) subsidy justified in Nigeria?
Before I make known my answer, I will like to bother intellectuals following this debate with a few definitions as it concerns this debate and the Nigerian situation;
Fuel Subsidy: in the simplest terms, means the government is paying part of the cost of you purchasing a liter of petrol so that it will be affordable for you and other average Nigerians.
Secondly, justice (adjective: Justified) can be defined as the state of being fair.
With perfect understanding of the defined terms, I think it will be safe to rephrase the debate topic as thus: Is the act of government halting the reduction of fuel pump price so as to make it affordable for average Nigerians fair?
Well, my answer is No; the removal fuel subsidy is not justified in Nigeria. I will be rationalizing my position with the following points:


Firstly and simply too, the problem that led to the introduction of fuel subsidy have not been addressed, so it unjustifiable to halt the payment of fuel subsidy without addressing the problem that led to it’s inception in the first place. Fuel subsidy was introduced to Nigerians in the year 1986 and the reason was because our refineries where in a state of unrepair and could no longer produce enough fuel for our domestic consumption, the fuel subsidy was designed to last 6 months so as to give time to fix our refineries, but it have lasted for over 29 years and the refineries have still not been fixed. As at September 2015, our faulty refineries were producing a total of 6.76 million liters of petrol per day for a country which needs over 40 million liters of petrol per day, leaving the country with a deficit of about 33.34 million liters of petrol to be imported. Following the sanctity of this fact, one can authoritatively conclude that the removal of fuel subsidy will be justifiable only when Nigeria’s refineries start producing enough fuel for the daily consumption of Nigerians. I know my opponents might want to say that the money saved from the removal of fuel subsidy will be used to repair the refineries, well, I want to state succinctly that the reason why our refineries have been in a comatose state for over 27 years is because of the lack of political will and not the lack of funds.


To further fortify my position, which is to prove the unjustifiability of fuel subsidy removal, I will like to have us all look at the prospects of this action, it’s obvious to the informed that the reason why the discomfort caused by the removal of fuel subsidy in Nigeria is still latent is because of the global fall of oil price. With oil selling for about $27.67 per barrel (as at 18th of January 2016), the average Nigerian can, after much struggle, manage to squeeze out 87 Naira to buy a liter of petrol. But by the other half of this year, when the price of oil increases (as predicted by BP's CEO, Mr. Bob Dudley) the pump price of petrol will consequently increase and it will become impossible for average Nigerians to survive, this will be made so because the government have removed fuel subsidy without putting in place any palliative measures, neither have they increased the minimum wage! The second half the year, which will come with an increased fuel price, will see the cost of transportation sky rocket and the cost foodstuff increase, consequently having a multiplier effect on every aspect of our daily lives which will eventually throw the citizenry into unimaginable hardship. Surely from the above point, it is not justifiable for a government to take away the only social benefit its people gets from it (which is petrol subsidy) without providing any welfare package, palliative measures or any form of increase in salaries.

Finally, for those who may have not yet been convinced that the removal of fuel subsidy is not justified in Nigeria, I will crave your indulgence to join me in looking at this fuel subsidy issue in retrospect. The immediate past government of Nigeria in January of 2012 took an action of totally removing fuel subsidy, this actions was met with a defiant reaction by the people who demanded, and rightfully so, that the payment of fuel subsidy be continued. After a historical drag between the government and the people, a compromise was reached, which consequently saw fuel subsidy partially removed. The government promised immediate provision of palliative measures to cushion the effect of the partial removal of fuel subsidy and also promised to reinvest the funds into the economy which will provide immediate and remote benefits for the country. I'm certain that 90% of the followers of this debate will agree with me that those palliative measures never went beyond our television screens, also if those funds where ever reinvested into our economy is an issue that have been widely debated. Considering this fact; that the money gotten from the partial removal of fuel subsidy in Nigeria was unaccounted for, how does one intend to justify the total removal of fuel subsidy in Nigeria? I hope my opponent will not make the error of saying that we are in a new political dispensation, because governance as we all know, is a continuous process.
However, if the government can fix our refineries, provide welfare packages and restore the lost trust, only then can the removal of fuel subsidy be justified in Nigeria.


References
http://www.ocnus.net/artman2/publish/Editorial_10/The-Full-Story-of-Fuel-Subsidy-Crisis.shtml
http://www.nnpcgroup.com/PublicRelations/NNPCinthenews/tabid/92/articleType/ArticleView/articleId/618/Refineries-Producing-676-Million-Litres-of-Petrol-per-Day-NNPC.aspx
http://www.ngrguardiannews.com/2016/01/crude-oil-price-plunges-to-27-67-per-barrel
http://www.bbc.com/news/business-35363066
http://www.thisdaylive.com/articles/fue,-subsidies-should-go/215710

luxanne:
@Aminat508,

I see you dear

mrlaw93:
Congrats to Menzo4u and Betacitizen . U guyz ve made us proud. More grease to ur elbow.

menzo4u:
It is without doubt, the fountain of Nigeria's wealth, it is indeed an enviable blessing to have it in our dear nation, I am referring to nothing but the Premium Motor Spirit (PMS) which synonymously translates to fossil fuel or petrol.

Before taking the driver's seat on today's subject of discourse, my unreserved salutation goes to the committed orgainisers of this debate, the credible judges, intelligent debaters, and the ever-following audience. I am Jimoh Ahmed Temitope, menzo4u by moniker, representing the prestigious Yaba College of Technology, Yabatech.

Fuel Subsidy, according freedictionary.com, is a monetary assistance granted by a government to a person or group in support of an enterprise regarded as being in the public interest.
In layman's view, which I term the "bricklayer's explanation", there is a certain amount of money that the government is paying to some people known as "Oil Marketers", as a form of assistance for them to reduce the cost of the burden of oil importation on them, they are paid a certain amount of money, when this payment is made, it is called "fuel subsidy".

So the topic is simply asking this question, “the government has decided to stop paying this money (fuel subsidy). Is it a justified action?". To this, I say "yes".

First and foremost, you will agree with me that the scam, called subsidy should not in anyway be given any consideration in the dictionary of Nigeria. None of the major sectors is practically working in the country, the education sector is screaming for help, the value of our currency is bleeding to death, the health sector is nothing to write home about. So it is definitely justifiable for the government to stop, remove, or eliminate fuel subsidy in order to use the money generated to revive the major sectors of the economy.

In addition, according to a news report on DailyTrust (December 15, 2015), the current Minster of State for Petroleum Resources, Dr. Ibe Kachikwu, affirms that Nigeria spent N1Trillion on fuel subsidy in 2015 alone, which is more than the nation's total budget for two years on other important sectors of the economy. Imagine the economic benefit Nigerians stand to gain if this huge sum of money was channeled into the non-oil sector.

Furthermore, by re-investing the money generated from the removal of fuel subsidy into an important sector like the agricultural sector (for instance), this will not only boost the country's Gross Domestic Product (GDP) but also be a saviour to our fast depreciating currency.

So far, I have come to the realization that Nigeria can be compared to a recharge card seller who has a damaged printing machine (for printing recharge cards), but instead of repairing it, he prefers patronizing another firm for the printing, and thereby losing a huge part of his profit to another organisation. Such is the case of my dear nation, Nigeria has a total of four refineries which can be repaired and effectively maintained to refine crude and produce oil locally. Why is it then justifiable for the government to be paying some so called oil marketers instead of bringing our refineries back to life?

More so, the benefits Nigerians stand to gain from fuel subsidy removal is enormous, there will be more concentration on diversifying the economy, more financial resources will be channeled on infrastructural development, creation of employment through industrialisation, and servicing the country's debt among other merits.

My opponent may argue that the removal of fuel subsidy will bring about increase in pump price of fuel, and this will bring about economic austerity on the citizens. I strongly believe that as lovers of Nigeria, we must be ready to make necessary sacrifices for the development of our motherland, the assumed "austerity" will definitely be a temporary one, that is, if at all the global prices of oil go high. I agree with J.M Bark on this quote, “you can have anything in life if you can sacrifice everything else for it". Sacrifice is part of life.

My opponent may also want to find leverage in saying that corruption and mismanagement of fund will greet the money generated from the removal of fuel subsidy, but I strongly believe in the present administration's stance against corruption, as this is vividly evident in the way it has been tackled with high level of gravity so far.
With Mrs Kemi Adeosun as the "striking" finance minister, Dr. Ibe Kachikwu as the "defensive midfielder" in the petroleum ministry, and president Muhammadu Buhari as the "coaching" president in the country, and Mr. Ibrahim Magu of the Economic and Financial Crimes Commission (EFCC) as the watchdog, the case of corruption will be drastically reduced if not completely eliminated.

In conclusion, the failure or success of the future of our country depends on the actions we take today, and posterity will judge us for it. On this note, as a proud ambassador of this country, having seen the pending benefits that the masses stand to gain from the removal of fuel subsidy, I say boldly and firmly that it is completely justified. Thanks.

Reference:
Definition of Subsidy
http://www.thefreedictionary.com/Fuel+subsidy

J.M Bark's quote
http://www.goodreads.com/quotes/tag/sacrifice

Mr. Ibe Kachikwu on fuel subsidy
http://www.dailytrust.com.ng/news/general/nigeria-spends-n1tr-on-fuel-subsidy-in-2015-kachikwu/124416.html

betacitizen:
The best way to learn in life is to get information from those who are already experienced, this is why, on this note, I shall start this debate by quoting an erudite Chief Economist, Razia Khan, she said," the reasons for fuel subsidy and its economic effect is regressive". Can we agree to this quote? Well, this question shall be answered in the course of this educating debate.

The chairman, independent judges, great coordinators, fellow debaters of high intellectual quotient, and the ever-following audience, I extend my humble greetings to you all. I am betacitizen, the second representative of Yaba College of Technology, Yabatech. The topic before me says as quoted, "Is the removal of fuel subsidy justified in Nigeria?". I debate to support the notion by saying "yes".

According to Collins Dictionary of Economics, subsidy is the money paid by the government in order to help an industry or business, or to pay for public service. So, fuel subsidy is the monetary supports rendered by the government in order to pay oil marketers so as to reduce the amount of money paid by the public for the purchase of fuel or petroleum-related products.

It is an undeniable fact that the payment of fuel subsidy has in recent years brought nothing but an untold economic hardship and adversity into our dear nation. How can we best describe a situation where about 20% of our national budget goes into the hands of a few "cabal", leaving the rich getting richer, and the poor getting poorer? The poor masses are really the ones who suffer the economic devastating effect of the fuel subsidy. For example, the money that is supposed to be channeled towards educational development, improvement of health system, and drastic development of infrastructural facilities is used to pay for the scam called subsidy. All these are less of a burden to the rich because their children hardly school in Nigeria, and they merely use those "general" hospitals, so, the poor masses suffer more.

In general perspective, the removal of fuel subsidy is a necessary economic austerity that must be given a consideration in the country in order to put us on our toes as a nation. Continuous payment of fuel subsidy will only increase our level of dependency on oil importation rather than look inwards on revamping our "dying" or "dead" refineries. But in actual sense, at this period when the price of oil has drastically fallen in the global market, Nigerians will hardly feel any sharp increase in petroleum pump price or direct increase in the prices of goods and services as witnessed in the previous administration. The International Bank for Reconstruction and Development (World Bank) also gave credence to this through her leading Economist, Mr. Litwack, by telling President Muhammadu Buhari that the best time to remove fuel subsidy is now.

In addition, the removal of fuel subsidy will also enable the government to create room for diversification of the economy which is a very important recipe for the growth and development of a developing country like Nigeria. According to the Nations Encyclopedia, the agricultural sector alone has the tendency to employ 70% of the country's labour force. This will not only put food on the table of the common man, but will also bring about a boost in the country's Gross Domestic Product (GDP).

Furthermore, a flashback to the administration of former president Goodluck Ebele Jonathan shows a genuine beauty in the removal fuel subsidy through the introduction of the Subsidy Re-investment Program (SURE-P), but if not for the fact that the whole process was battered by the high rate of corruption and favoritism in selecting those who benefit from it, the program would have been the best thing that would have happen to Nigeria. Now, the question is, will the same issue of corruption and mismanagement not resurface in the present day government as fuel subsidy is removed? No, because there is a huge sign of seriousness in the way the government is tackling corruption, therefore, corruption will not be a hindrance.

In comparison, a glance through the world to examine or view countries which have already followed the trend as far as the removal of fuel subsidy is concerned will definitely be enough to convince any right-thinking Nigerian that the action taken by the government to remove subsidy is indeed a justified one. Developed and developing countries like India, the United Arab Emirates, Cameroun, Egypt, and Ghana have already followed suit.

In conclusion, I fervently believe in the mantra which says, “Rome was not built in a day". So, if we must truly build a Nigeria that is even better than the ironic Rome, the removal of fuel subsidy is the first step in the right direction, therefore, it is definitely justified. Thanks.

Reference:

Razar Khan on fuel subsidy
http://www.thisdaylive.com/articles/khan-nigerias-fuel-subsidy-policy-is-regressive/209142/

Definition of subsidy
http://www.collinsdictionary.com/dictionary/english/subsidy?showCookiePolicy=true

http://www.nationsencyclopedia.com/Africa/Nigeria-AGRICULTURE.html

Percentage of Nigeria's budget on fuel subsidy
http://www.vanguardngr.com/2015/05/why-fuel-subsidy-must-go-2/

World Bank tells Buhari to remove fuel subsidy
http://www.premiumtimesng.com/business/194818-fuel-subsidy-removal-now-is-best-time-to-act-world-bank-tells-buhari.html

bamdexfarms:
Yabatech, the first and still the best!!! shout out to all the hollywoodwers!!!

noskyboy:
Good evening noble organizers and moderators of this debate, respected judges, co-debaters and all nairalanders. I am noskyboy, representing the University of JOS. Before delving into defending our position on this topic, I would like to create a background understanding on the key concepts and issues involved.
Subsidy in general terms is a form of financial aid or support provided mostly by the government to an economic sector, institution, business or individual. Therefore it is a measure adopted by certain governments to keep the price consumers pay for certain good or service below market levels; in other cases it may be directed towards producers to reduce cost of production.
Nigeria is one of the largest producers and exporters of crude oil, but she imports majority of the refined petroleum products consumed by Nigerians, mainly because of her inability to refine her own crude oil due to breakdown of its refineries due to lack of maintenance and mismanagement. From the 1980s to late 2015 premium motor spirit (PMS) or fuel was subsidized by the government in order to stabilize and reduce the price burden of the product on Nigerians, as such the government paid importers of petroleum products part of the money spent on importing the product, this is in order to aid even the poorest of Nigerians access fuel, The current administration has announced the removal of fuel subsidy, thereby leaving Nigerians to bear all the burden of purchasing this essential product. The question therefore remains can the removal of fuel subsidy in Nigeria be justified?
My answer is NO. In order to back my position, I would start by discrediting the reasons the government has provided for this act. In 2012 the administration of Goodluck Jonathan attempted a total removal of fuel subsidy claiming that a “cabal” is benefiting from fuel subsidy rather than Nigerians and also fuel subsidy is too expensive for the government, therefore fuel subsidy should be removed. The current administration is also singing same tune as their reason for removal of fuel subsidy, according to Kachikwu the minister of state for petroleum “we can’t even understand where those subsidies were going to. There are a lot of fraud elements in it so we need to cut it off” he also said that the earnings of the government have dropped due to fall in oil price, he proposed a price modulation scheme which would keep fuel prices below the current #85 per liter, despite removal of subsidy.
The above reasons provided, can in no way justify removal of fuel subsidy in Nigeria, because firstly; it is the duty of the government to make sure all ‘fraud elements’ are removed and the gains of the subsidy reach Nigerians, does it mean that a group of individuals are bigger than the government?, should Nigerians be left at the mercy of exploitative capitalists?.
Secondly; Nigeria is rich enough to subsidize fuel and still improve critical infrastructure and fund other developmental projects, but this is not the case mainly because of mismanagement, too much economic loop holes, policies that encourage wastage, extravagant spending on salaries and allowances of executives and legislators, embezzlement of public funds due to corruption; according to transparency international (2015), Nigeria has lost over $400 billion to corruption. Also states don’t look inwards to focus on agriculture and other natural resources and they don’t generate internal revenue, but rely on federal government. If these things are fixed, there won’t be need to remove subsidy.
Thirdly; the price of an important commodity like PMS should never be left to be determined by market forces (demand and supply) in a developing economy like that of Nigeria, because only the close friends of the government and the rich can afford licenses to run refineries or import fuel, therefore there won’t be competition and poor Nigerians would be placed in the hands of a few capitalists who are profit hungry. The price modulation scheme is just an opportunist and escapist solution, because it coincides with a period of global oil price fall, therefore Nigerians won’t feel the pinch now, but when prices go up again, Nigerians would be paying high, therefore such scheme is not sustainable on the long run.
Furthermore, Fuel subsidy removal in Nigeria cannot be economically, sociologically and even politically justified;
Economically; the removal of fuel subsidy in Nigeria cannot be justified, because such decision would have an adverse multiplier effect on the economy on a long run, it will lead to the increase in prices of everything, from transportation to cost of running businesses especially small businesses which would increase prices of food and other services and goods.
Sociologically; the structure of Nigeria is one characterized by wide spread poverty, social inequality and corruption in government, the question is, how sure are we that the government would reinvest the subsidy for the development of Nigeria? Past records have pointed otherwise. Therefore removing the only sure social service, Nigerians get from government is an anti-social welfare move; because education, security, clean water, stable power supply and food are things the government doesn’t provide for Nigerians, as such the rich and political class rather gets more to steal from and the poor are left un-catered for.
Politically; Nigeria is a democratic state, this means the people are the center of the government, and their will should be done. Removal and attempt to remove fuel subsidy has been met with disapproval and street protests in the past. Some Nigerians have recently used social media to register their dismay, also the NLC recently condemned such move, therefore it is politically un-justifiable to remove fuel subsidy in Nigeria amidst such disapproval.
In conclusion, Nigerians may not be feeling the full adverse effects of the fuel subsidy removal at the moment, due to global fall in oil price but when the prices eventually go up again Nigerians would be left to suffer with no visible palliative measures in place to ensure soft landing.
Word count: 990
References
Akinwale Y et al. 2012. Political economy of phasing out fuel subsidy in Nigeria. Scientific and academic publishing retrieved from http://article.sapub.org/10.5923.j.ep.20130304.01.html
http://scannewsnigeria.com/featured-post/nigeria-has-lost-over-400billion-oil-revenue-since-independence-says-ezekwesili/
Moyo N and Songwe V. 2012. Removal of fuel subsidy in Nigeria an economic necessity and a political dilemma. Retrieved from http://www.brookings.edu/research/opinions/2012/01/10-fuel-subsidies-nigeria-songwe
Nigeria: fuel subsidy: A desktop study by the center for public policy alternatives. Retrieved from https://toluogunlesi.files./2012/01/fuel-subsidy-desktop-study-report-copy1.pdf
Premium times report, December 26, 2015 - Nigeria scraps fuel subsidy, cuts petrol price to N85 per litre. Retrieved from http://www.premiumtimesng.com/business/195743-nigeria-scraps-fuel-subsidy-cuts-petrol-price-to-n85-per-litre.html
Nigeria: benefits and risks of fuel price modulation. Retrieved from http://allafrica.com/stories/201601042261.html