Removal Of Fuel Subsidy: Using Mobile To Lower Costs

Posted by Mister Mobility


While Nigerians were yet celebrating the arrival of the year 2012, our very sensitive and caring government was busy hatching a plot. The plot has now been executed, and we have been rudely presented with the new year’s gift of fuel subsidy removal.



In simple English, we can expect to pay N141-N150 per litre of petrol from now. Already, most fuel stations have been shut down by their operators pending when they can adjust their metres to reflect the new prices.

While this is not a political or economic blog, it needs be said: No responsible government pulls this kind of stunt on its citizens on New Year’s Day.

In a country where public power supply is pathetically low (an average of two hours daily), this action is irresponsible and insensitive. Our government runs a bloated operation, with excesses everywhere including in salaries and other personal costs. Yet, this same government seeks to impose more suffering on its citizens.


Leadership should be willing to sacrifice first before imposing any crosses on the citizens! Sadly, our leadership as a nation is too spineless and too selfish and self-centred to even consider such a notion.


Shame on you, President Jonathan (and whoever is advising you)! You lied about the process and the date. Why should we believe anything else that you say?

PS: In case I disappear suddenly, you all should look in the direction of the Nigerian government’s State Security Services (SSS) for speaking publicly against the government.

Permit me to address the silly cop-out that the proceeds of the removal of the fuel subsidy will be used to help the poor. That is pure bollocks. How much of what government makes today is used for the poor?

Where is public power supply for the poor? Where are motorable roads? Where are efficient public transport facilities? Where are the health facilities for the poor? Where is potable water? Where is security (the Boko Haram group is effortlessly running rings around Police, SSS and Military intelligence agencies).

This bunch of thieves and rogues in government stuff their pockets and stomachs, and fly around with the funds that should be used for public infrastructure and services.

Dear Federal government, do plug corruption in high places first, put things in place for the public good, and we can believe that indeed the proceeds from any removal of subsidy will be used for the poor.


Overheads Through The Roof

In Nigeria, the average business concern spends a huge chunk of its overheads on power generation. I run a business, and I can tell you how horrible it is. Now, things will simply get worse.

One of the things that I am considering is having to buy the common, small petrol generator popularly referred to as “I Better Pass my neighbour” for office use to replace the larger incumbent. We will simply turn off heavy equipment such as the fridge when we are on generator.

Enter: Mobile

If you run a small business, depending on your specific requirements, you might need to explore taking advantage of mobile devices to cut down your costs. Personally, Mobility Towers can run largely on mobile devices.

With a tablet, I have 10 working hours of always-on internet connectivity. This is in contrast to the maximum 6 hours that you can get on a netbook or laptop.

So, we can put on the generator for a few hours in the morning to get all our devices fully charged, and then we are good for the rest of the day.


Work From Home

Even better, depending on what you do as an SME, you may not need an office to run your business. So, you can eliminate the rent factor and related expenses of running a dedicated office by working from home.

Staying connected via mobile devices – feature phones, smartphones, and tablets – makes it possible to work from home, or anywhere for that matter.

Conclusions

Whatever and however you choose to run your business, it certainly is time to re-evaluate and adjust in order to stay in business.

In the meantime, let’s hope that Nigerians will get up and actually resist this insensitive New Year’s gift from Aso Rock.

Comments! How can you use mobile to mitigate the effects of the new fuel prices in your business, or in your personal expenses? If you want to express how you feel about the sudden removal of fuel subsidy too, please feel free.


21 comments

  1. Well, simply make that voice call instead of travelling across town. Instant messaging apps like bbm , yahoo messenger, gtalk etc can also come in handy. Skype meetings can also be arranged where necessary. Either way, we will survive. As Nigerians, we always do. It’s in us.

  2. A reproduction…

    By Bayo Adeoshun

    THEARTRE OF ABSURDITIES

    The last two or more months since President Goodluck Ebele Jonathan threw up to the Nigerian public the issue of removal or retention of petrol subsidy for debate, it has brought out the good and bad in Nigerian debating skills similar to what we witnessed in the1980s when the then military Head of State, General Ibrahim Babangida [Rtd] raised the issue of whether to take up the IMF loan in the 1980s.

    But it has been in the public hearings conductedby the Senate Committee on Petroleum Resources [Downstream] and the debate in the House of Representatives , both on the issue of removal or retention of petrol subsidy that we have seen and heard things on the issue that are ridiculously unreasonable,unsound, or incongruous.

    That these utterly or obviously illogical, or untrue; contrary to all reason or common sense; laughably foolish or false: absurd explanations that are associated with extremely poor reasoning, the ridiculous, or nonsense have come from individuals and institutions that should know better is all the more laughable.
    In the midst of these things on the removal or retention of fuel subsidiesthat are extremely unreasonable, so as to be foolish or not taken seriously, or the state of being so have however come some glimmer of light that have properly pointed the way to putting an end to this debate and taking needful action.
    The first absurdity is the motion by the House of Representatives calling on President Goodluck Jonathan to retain the petrol subsidy because of the hardship the increase in the pump price of petrol would bring on ordinary Nigerians and to source funds from other sources to finance other items in the 2012 budget other than from subsidy savings.

    This statement is absurd not only because the House of Representatives is calling on the Federal Government to continue borrowing money to finance its budget deficit, but also because the House of Representatives are feigning ignorance that the budget deficit has technically been removed based on the demands made by State governments.

    In the months of September and October 2011, State Governors refused Nigerian National Petroleum Corporation [NNPC] and Petroleum Products Pricing Regulatory Agency [PPPRA] from making deductions for fuel subsidy from the Federation Account, a factadmitted by Governor Sule Lamido of Jigawa State who said: ‘’Officiallyas a matter of the law, thesubsidy is gone. If you look at our budget, the subsidy is gone but then the capacity to actually say it is what is lacking’’.

    The second absurdity occurred when Dr [Mrs] Ngozi Okonjo-Iwela, the Minister of Finance appeared before the Senate Joint Committee on Petroleum Resources [Downstream] and was asked to explain the difference between the amount earmarked for petrol subsidy in 2011 [N245.9billion] and the amount spent so far [N1.34billion], and she said that the Ministry of Petroleum Resources would be In a better position to explain that.

    What our own Chancellor of the Exchequer or Secretary of the Treasury is technically saying is that she is not in a position to explain how over N1.1 trillion of unbudgeted expenses hasbeen incurred by the Ministry of Petroleum Resources, the Nigeria National Petroleum Corporation [NNPC], and the Petroleum Products Pricing and Regulatory Agency [PPPRA].

    The third absurdity comesfrom Mrs. Diezani Alison-Madueke, the Minister of Petroleum Resources when she told the Senate Committee that NNPC is too big for Federal Government, is not subjected to the consolidated fund of FG, and cannot depend on federal budgets because it runs very capital intensive operations beyond what governmentcan finance.

    This mother of all absurdities has so many grave implications that the mildest way I can put it is that the tail [NNPC] is the one wagging the dog [Nigeria] in spite of the fact that NNPC is a statutory creation that is subject to the Nigerian Constitution, and in spite of Mrs. Diezani Alison-Madueke saying that NNPC functions largely like a private [secret] commercial enterprise.

    The forth absurdity comesfrom Mr. Austin Oniwon, the Managing Director of NNPC who could not supply ready answers to two questions by Senator.Bukola Saraki:’’What is the average capacity utilization of the refineries and what amount of PMS would the refineries give us for the months of October, November and December?

    My take on this is that when the Managing Director of NNPC does not know the average capacity production of petrol by refineries under his control or the quantityof petrol NNPC will produce between now and December, how can he know what quantity ofimported petrol is required to augment localproduction?
    When NNPC is supposedly the one taking 445, 000 barrels of crude oil for a day local refining and no one knowing the exact quantity that is refined while the remaining is supposedly exported and sold, how can PPPRA, the agency that gives out petrol importation licenses to the 77 companies on its approved list know what quantity of petrol to import?

    The fifth absurdity will have to be the release of the names of the 77 companies that are on thelist of those given licensesby PPPRA to import petroleum products in 2011, with the added revelation that the number of companies involved in this milking ofthe cow has grown from 3in 2006 to 77 in 2011.
    That is why I am not amused by the Senate Joint Committee’s surprise that N600 billion was spent on petrol subsidy in 2010 with the amount almost tripling to N1.5 trillion by the end of December 2011, as if theyare not aware that it will take more allocation of import licenses to satisfy 77 companies.
    Now that we know the companies benefiting from the ‘’monkey dey work, baboon dey chop’’ business called petrol, arewe to continue with the fuel importation and enriching these companies or do we deregulate and allow market forces to sanitize the business of fuel importation and ultimately building of refineries in Nigeria?

    In the midst of all these absurdities, the most enlightening issue that is indicative of what is to come when we finally come to terms with the need to move beyond petrol subsidy removal is the response of Mr. AustinOniwon that it cost between $4 and $5 to, [depending on the exchange rate], to locally refine a barrel of oil, which is equivalent to 159 litres.

    Now that we know it costs NNPC according to its Managing Director, N5 to produce a litre of petrol, it is clear that evenwhen petrol is sold at N65per litre Nigerians are the ones subsidizing government inefficienciesand that the additional N70 per litre being allegedly spent by the Federal Government on imported petrol is subsidyfor the importers.

    But as long as the local refineries are owned by Federal Government, they will remain dysfunctional and we will continue importing petrol and allegedly subsidizing it, and no private investor will build refineries in such a regulated environment as they will not be able to compete with NNPC and PPPRA.
    MTN, AIRTEL, ETISALAT, GLO, Starcoms, Visaphone,Multilinks, MainOne, Mobitel, and others wouldnot be active players in the telecommunicati ons sector today but for the deregulation in that sector, and neither will any private refinery be built in Nigeria as long as Federal Government is thedominant player
    As call rates have moved from per minute to per second billing, and continue to fall drasticallydue to competition givingNigerians a wide range ofoptions, so also will the pump price of petrol will eventually fall as competition and the widerange of options availableto Nigerians kick in.

    The issue is not really the removal or retention of subsidy, but the disengagement of FederalGovernment, NNPC and PPPRA from the petroleum products sectorand the elevation of the Department of Petroleum Resources to the role of regulator like National Broadcasting Commission and the National Communications Commission.

    In closing, I have always been, I remain an incurable fatalist for the deregulation of the petroleum sector.

  3. this is worse than the conventional boko harram assault where you have a pre-defined target area and number of casualties. in this case, the removal of fuel subsidy would hit hard on nigerians. a greater percentage of nigerians already live below poverty level. this would further degrade the living standards of nigeirans.

    for SME’s, a tablet and a smartphone is key so one is in business on the go. once the devices are fully charged over-night; one can work from anywhere.

    that brings me to the choice of a Tablet. this forum just gave me direction on the choice of a smartphone… pls can someone recommend a viable tablet to purchase…..

  4. Power was my major consideration in choosing the NetBook i purchased about 1.5 yrs ago.

    The financial noose just got tighter…

    There is need to user resources more efficiently to keep afloat..
    See http://is.gd/KMYcML

  5. Well, look on the bright side!
    More bicycles sales will boost the economy!! Lol

    Seriously though, this isn’t governance. This is madness! This is a government lying to its people, this is a government peeing on our bodies and telling us that its rain.

    Small scale business will suffer, poor people will suffer, even the middle class will suffer!

    God help us!

  6. I sincerely do hope the adoption of solar as a alternate source of energy will be given greater consideration with this fuel subsidy removal of a thing , it also does not help that Ghana just removed their subsidy, Uncle Jonathan may want to latch on to that also that they are doing the right thing.

    I see mobile as a way to save, mobile banking instead of burning fuel to go the bank one can do transactions online, i especially see netbooks and tables becoming more useful now since they provide more battery power, so if your business does not really power dependent, all you need is a fully charged tablet or netbook to carry you for the entire business day or at least most of it.

  7. By now am sure most people will now believe that naming your child Goodluck does not necessarily mean u will get Goodluck.

    I am so annoyed with our President and his cabinet right now.

    A couple of months ago I lost money on business for 1.5months because Mr president had changed the Vehicle plates and we had to wait to get it.

    Now he has raised fuel prices and EVERYTHING except the humble salary from my primary job will GO UP. I pity young guys out there its a Tough time to start a family.

    PMS has a multiplier effect on everything.

    Currently, Its a Pity to be a Nigerian.

    This is the Worst President since Independence.

  8. This is the mother of all battles, the only battle that would unite bokoharam, muslims and christians. Arab spring would pale, especially in Northern Nigeria when these elements collide in to a fusion reaction.

    What happened to Jonathan, this derailment is fatal.Lord Jesus call this backslided president to order. Fasten your Seatbelts.

    Yomi thanks, you just spoke to me when you said work from home. Thanks

  9. This subsidy issue was not a good new year gift to Negations. It came too soon though it was necessary but my own take is that The president should put his presidency on the line if the money the government will realise can not be accounted for or else……

  10. GEJ was excessively rude to announce such on NewYear’s day. I mean c’mon, how insensitive can the Government be?

    Its a shame when the principal officers of two sectors (Petrol and Finance) aren’t totally aware of what is goin on within their juridstiction?

    I dont see (nor do i believe) the Government has set in place any plan to cushion the adverse effects of the subsidy on the middle and low class Nigerians.

    Seriously GEJ, you would go down in History as the most spineless and unImpressive Nigeria leader (Turai n the yarAdua dynasty anyone? Tossed into the dark recesses of Nigerians’s memory. Leave a lousy legacy and….)
    …..

    its January 2nd and you know what? For once, i’m really terrified for this country. It feels like Nigerians’re pawns in a game of chess. Who are the REAL players? What are their aims?

    Would NLC react??????

  11. So i was discussing with a friend (yes, at 2am *shrugs*) and he thinks the NLC should ground our economy to a stand-still to force Government-rethink on subsidy removal. Would this be adviceable?

    In Summary, its not so much bout subsidy removal but effective management of the economy of the nation to which i maintain that GEJ is a failure.
    @eyebeekay indeed, Nigerians are already subsidizing Government inefficiencies.

  12. I totally agree with eye.bee.Kay. Considering all the facts and fictions that has come to light during these debates on removal of fuel subsidy, the best way forward is full deregulation. It will hurt, but we’ll readjust and come out the better for it.

  13. a man’s car was snatched at a gun point, all d man could shout is “oh my fuel” oh my fuel……

    Ok see now i have a keke nappep, for transportation….
    Where we carry 50 naira shall now be 100naira. Every tin x 2
    bicycle should b an alternative
    boys,girls,men and women get a bicycle,..
    I do fill my keke nappep tank b4 400,
    now it shall be 900

  14. less i 4get been thinking……….
    Don’t u think our mobile servi provider will increase…………..
    1) call tariffs
    2) data plan cap
    3) sms rate

  15. Girl: Honey,Pls take me somewhere expensive… Boy: oh ok Let’s go to the filling station…

  16. Beyond fuel subsidy removal, we need to audit our energy consumption, we need to reduce our carbon footprint. Alternate sources of energy, renewable energy and the likes. See sunlight and vast areas of land wasting up north, see wind wasting in the coastal areas, see waste well wasting in our cities( what happened to the biomass and biofuels?)
    where are the fuel efficient cars? (the new 85mile/gallon KIA Rio)
    personal use- solar powered netbooks like Samsung’s, solar phone chargers, solar powered lightening in homes.

  17. the economics of this policy gives a picture of a brighter future. more money for capital expenditure, private refineries, job creation e.t.c but those are in ideal societies. This is Nigeria, before deregulation our politicians were stealing in billions. Now, the figures will be in trillions.

  18. the economics of this policy gives a picture of a brighter future. more money for capital expenditure, private refineries, job creation e.t.c but those are in ideal societies. This is Nigeria, before deregulation our politicians were stealing in billions. Now, the figures will be in trillions.

    This is the crux of the matter.

    At no time in the past has the proceeds of any subsidy removal exercise yielded any returns for the people. The thieves and looters in government ALWAYS helped themselves to the funds. What bis going to be different this time?

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