Labour and compromise on deregulation, tariff
The core issues for which the Labour Unions had threatened a strike action are largely twofold – the unwholesome increase in the price of petroleum products and the hike in tariff for electricity across the country. The confusion that followed the increase in the price of premium motor spirit at N162 a litre triggered the crisis. This increase in the price of premium motor spirit happened in a week the Federal Government also approved a 300 per cent hike in electricity bills.
It can be recalled that the atmosphere before the calling off of the strike was tense and that this created multiplier effects on the social and economic life of the nation. Many had already stockpiled food and other essential items hoping for the worst when eventually, the strike never took place with the aggrieved masses withdrawing back to their shelves hoping that the raging issues would be eventually resolved one way or the other. Indeed, Nigerians are very hopeful and resilient people. The point at issue is how the government and the unions can meaningfully navigate through the post-strike period. Any mismanagement of this period has the potential of leading to the resurgence of the crisis, albeit in a more dangerous dimension.
The battle for the design of appropriate pricing of petroleum products in Nigeria has been long drawn. Many have opined that unless this issue is addressed, there would not be any meaningful progress in the efficient delivery of these products to the Nigerian public. These issues have wide-ranging implications for the standard of living of the people. The issues include smuggling of products to the neighbouring countries and functioning of the local refineries and the efficient operations of the downstream sector of the oil and gas industry in Nigeria.
The altercations between the unions and the Federal Government in finding a common ground in addressing these issues led to the prolonged negotiations between the parties that led to agreements on three key areas. The key areas include: putting in place palliative measures to cushion effects of the deregulation of the downstream sector of the oil and gas industry; the establishment of timelines for the revamping of the refineries to boost domestic production of refined petroleum products and the suspension of the introduced reflective cost regime in the electricity tariff for two weeks when a technical committee comprising all parties to the negotiation would have come up with a workable solution to the vexatious issue. The provision of palliatives and the plan to revamp the refineries addressed the pricing of the petroleum products issue while the institution of the technical committee was to address the other issue of the hike in the tariff of electricity. The tariff is expected to be reviewed based on the report of the technical committee scheduled to present its report on Monday, October 12, 2020. By the agreement, the palliatives are to be in the areas of transport, power, housing, agriculture and humanitarian support.
Mixed reactions have greeted this development. While some commended the brinksmanship of the labour leaders in averting a national crisis in this era of the economic downturn due to the COVID-19 pandemic, others were disappointed and accused the labour leaders of a sell-out. Those who complimented Labour argued that Labour deserves praise, not condemnations. They asserted that being stakeholders in the Nigeria project, Labour needed to balance their actions to enhance the overall public interest. To this school, strike action at this time would definitely have a devastating effect on the country’s fragile economy and that the workers will equally suffer if the strike was not averted. They thus commended Labour for securing a suspension of the electricity tariff, which can be followed up with other things since negotiation is on-going. On the other hand, this compromise has been largely criticised by many across the country particularly the civil society organisations which suspect a compromise by the leadership of the unions, who many have tagged self-serving who were deemed to have invariably abandoned the public interest and resorted to feathering their own nests. The argument is that given that the whole world is gradually coming out of the lockdown effects of the COVID-19 pandemic and many people have lost their jobs, these increases are unjustified. Some members of the working population have had their salaries and wages slashed with inflation on the increase. In addition, this school argues that the government has increased payments of stamp duties on a tenancy with interest rates on deposits in banks slashed. With this level of impoverishment, they wonder whether it is proper for the government to “add salt to injury” by increasing the price of petroleum products knowing well that the increase has inflationary effects.
The key issue here is that governments in Nigeria have not been known to keep agreements. The lingering crisis of the Academic Staff Union of Universities (ASUU) with the federal authorities is a case in point where the Federal Government has serially turned its back on agreements it willing entered into with ASUU years ago. In that case, how realistic are those government promises on the palliatives? Going by the shoddy manner in which the Ministry of Humanitarian Affairs handled the palliatives in the heat of the COVID-19 lockdown earlier in the year, how certain should the public be that things will be different this time around? For example, the issue of the revamping of the refineries has been on the table since the Buhari administration came into power in 2015 and till the present, nothing significant has been done in this regard. Is it now that the government itself is complaining of revenue shortages that it will get the refineries back to life? What has happened to the plan to ensure that meters are made available to all consumers of electricity, irrespective of what the technical committee will recommend? The fact is that government, by their antecedents, cannot be trusted and labour could have done a better job and obtained a more concrete bargain for the poor masses than the shallow gains it got from the negotiations. It could have been better.
In the main, Labour still has the opportunity to protect workers and the general public from undue exploitation on new fuel price. The challenge is for labour to get concrete commitments from the government on how workers’ condition can be improved steadily over the coming months and years. It is hoped that any new concessions from the government would be concrete enough to avert any further civil unrest. There is the need for a design of a workable strategy that would address the needs of the already impoverished Nigerian populace. It is not yet Uhuru, or so it seems.
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