Kayode Idowu
Unless something gives in the brewing test of will over recent increases in domestic price of petrol and electricity tariff, Nigeria is about hitting a storm of civil unrest that portends fresh dislocations in the national economy.
The Trade Union Congress (TUC) will this Wednesday, 23rd September, head to the trenches with 79 civil society groups and ally labour unions on ‘an indefinite industrial action and national protest’ over the policies of the Muhammadu Buhari administration that it argued had left Nigerian workers and their families in life threatening penury. The action will kick in upon expiration of a seven-day ultimatum issued by the union in a letter last week to the President.
Few days further down – that is, Monday, 28th September – the Nigeria Labour Congress (NLC) will as well pick the gauntlet in what it threatened would be a “total shutdown of the country’s economy,” if issues at stake aren’t addressed by the expiration of a 14-day ultimatum it issued. Congress President Ayuba Wabba said the labour centre would “mobilise its members, civil society allies and other social partners to try to resist the policies (that) had driven many into poverty.”
The threatened actions are coming after negotiations between government and labour as well as civil society leaders last week were deadlocked. Government insists there is no way out of its policy of deregulation that has seen domestic price of petrol spiral to between N160 and N162 per litre and inexorably potentiated to further rise, while electricity is now being charged by distribution companies (DisCos) on a ‘cost reflective tariff’ that will make some consumers pay up to 100 percent more than previous rates. The two labour centres argue, however, that these policies entail a devastating multiplier effect that has driven many Nigerians into ruinous poverty.
Government had plied the argument broadly that the downstream petroleum sector had been fully deregulated; that no provision was made for subsidy in the 2010 budget and since petrol for domestic consumption is largely imported, the pump price would unmodulatedly reflect dynamics on the international crude market – invariably also, the foreign exchange market although government did not clearly state so; that subsidies had been a channel of humongous waste over the years that couldn’t be sustained; that government earnings had fallen by about 60 percent, hence there were simply no funds to deploy as subsidies even if it wanted; and that Nigeria yet enjoyed cheaper consumption costs comparable to other countries in the West and Central Africa sub-regions. Similar lines of argument were advanced for the new electricity tariff.
But TUC has rejoined that its members – indeed, other Nigerians as well – can’t bear the burden any longer, thus it demanded that government reverse the price increases among other things. In its letter to the President, the union said Nigerians faced “gradual and steady annihilation” by government policy designs such as the progressive increase in the price of petrol, which is being imported without concrete efforts made to get local refineries working. In the same way, the hike in electricity tariff was “without proper consultation and consideration of the effect of Covid-19, commensurate electricity supply, non-provision of prepaid meters (to consumers) and other biting economic realities,” among other factors. Responding subsequently to an argument by Labour and Employment Minister Chris Ngige that the union’s ultimatum was misplaced, and by implication void under international labour law because it was addressed to President Buhari rather than to him as the overseer of labour matters in Nigeria, TUC President Quadri Olaleye said: “Let the minister continue to quote the law. At the expiration of the seven days, he would see the action; he can then tell us if it is null and void or not…This one is beyond labour matters. We are not talking about salary increase here. We are talking of something that affects members of the union and the general populace.”
For its part, NLC said the price increases had severely whittled the purchasing power of Nigerians and fuelled high costs of goods and services, thereby completely eroding the gains of the N30,000 minimum wage. Wabba argued: “Many people are at pains now. The impact of the electricity tariff is the fact that those in category ‘A,’ which they have increased their tariffs, are manufacturers who will transfer the cost to their goods and services. That is why the cost of goods and services are also going up. Those issues that constitute the price is part of the inefficiency in the system, which government hitherto has been paying for and christened subsidy. Government cannot transfer its inefficiency to the people.” He revealed the bargaining line labour adopted with government, saying: “At this point, what do you have on the table to cushion the effects on workers, their families, because they have been pushed to the wall and already at the edge? Do you have anything for us? So that we can now say that despite these challenges, this is what I have for Nigerian workers that they can be able to have something that can cushion this effect for them.”
Life on ‘Main Street’ where you would find the majority of Nigerians totally bears out the issues labour has highlighted, and shows government as cocooned on ‘Privy Street’ from the realities. Not that too many object to deregulation as a general principle of economic management; the argument, rather, is: without first putting in place an ancillary framework for locally modulating the effects of international market forces, government would be tacitly abdicating by handing Nigerians over to free-wheeling deregulation. Economic headwinds before now had seen inflation rate at 13.2 percent in August; this can only get worse with the double whammy of price hike effected at the beginning of September. When the Presidency was recently reported saying food prices were crashing, it was betrayed as speaking from an insulated prism, because a widely applicable though symbolic counter-indication is the price of bread that bakers announced was being jerked up inevitably by 50 percent.
The issue that arises is how citizens are being buffered. Government presently isn’t even faintly contemplating salary adjustments, and far less so private sector employers. A suitable policy in the circumstance would be one that comprehensively modulates the local economy against price spikes instigated by wild forces of the free market. Tokenistic policies like handouts to the ‘more vulnerable’ and distribution of buses to co-operatives with the hope of succoring commuters against high fares would not cut it because palliatives never get to those who genuinely need them. In any event, how do you succor the poor against pervasive knock-on effect on sundry consumer goods and services. True, government promised autogas as a cheaper alternative to petrol; but it is yet to lay out the template on how the product would be made commonly available and how every vehicle currently using petrol, including urban commuter buses, would access services to convert to autogas usage. Deregulating fuel price before implanting such template is jumping the gun; and amidst the resulting hardships, Nigerians simply aren’t enamored by mere promises.
These are some factors at play as labour hits the trenches. If experience offers a guide, the threatened mass actions would not only involve workers, including those in sensitive sectors downing tools, there will also be street protests by huge crowds. Security agents will be on razor edge to contain angry crowds without levying crude force that could result in injuries or worse, fatalities; it will be a defining test for Nigerian security rules of engagement before the eyes the global community that will be trained on this country.
But it is as well important labour stays mindful that citizens could suffer from the action, especially if too long drawn. For instance, livelihoods could get endangered by a protracted strike so close on the heels of the Covid-19 lockdown that had forced many businesses on a tailspin. Moreover, there is already a ‘win’ against government, which designed deregulation as an open sesame of price increases trailing upswings in the international market. Take my word: with the present intensity of opposition to price increases, government will hesitate to jerk up again in November – meaning the policy is ‘DoA’ (dead on arrival).
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