Nigeria's borrowing $7.8b over the next 3 years but we're spending $6b this year on subsidizing imported fuel. Which means over the next three years we'll be spending at least $18b just to keep the Protesters/youth happy, and we wonder why we're undeveloped. There really must be something wrong with the black mans brain

Exactly! And some people even have the guts to point fingers about govt needing to borrow money to  fill in for what the states and LG's should be providing. If you question most of the subsidy lovers, you will find that they see absolutely nothing wrong with their governor being just an expensive decoration that does phuckall, but take a beggars bowl to Abuja every month.

This is a classic example of people rising to sell their kids future, and to beat and slap themselves bloody with a wild-eyed, terrifying ferocity. Some even lost their lives. For what?
Even worse, it turns out that the protests were sponsored by fuel marketers. It boggles the mind!

Nosa, I have a question for you:

If I am your father(president) and you are my son (masses). When you go to school (Nigeria), I give you some money for your feeding(subsidy) since they do not provide food in school(constant electricity, good roads, etc) and as you get to school, a bully( Cabal) takes that money away from you. Should I, the father stop giving you money or should I tackle the bully?

The average Nigerian youth is ignorant of the facts and looking at our universities today I'm not surprised. Nigerians have no one to blame but themselves for the poverty in this country. We want/need infrastructure yet we want the government to triple salaries and keep spending 25% of it's budget subsidizing an imported product. Something has to give

@jason123 your analogy is flawed because the president is not your father, nobody is meant to provide anything for you and there is no bully. Nigerians own Nigeria, what the pensioners are suffering today is caused by the decisions they made when they were young, the second they started to support military rulers, play tribal politics and rig elections they guaranteed themselves a wretched future. Today the Nigerian youth is laying the bed it'll sleep in in it's old age and from the decisions being made they're creating a bankrupt nation. Doesn't it strike you as odd that virtually every government since IBB has advocated removal of subsidy but every time the people have successfully fought against it, yet our poverty/unemployment levels have been rising steadily? Our currency has never closed a year higher than it started? Anyway as they say common sense is not common

Need we go over this well-worn argument again? Try and see the various threads that were opened on fuel subsidy removal before and during Occupy Nigeria.

What is worse is that these blind people don't see anything wrong with their states and LG's producing nothing; but they somehow imagine that the dwindling revenues from oil will continue to feed a nation with an increasing population and spiralling inflation. You have to wonder at the reasoning skills of the average "angry" youth.
Its like a boy shooting himself in the foot and thinking he can go out the next day to break the 100M record  (if he is lucky not to be crippled for life that is).

Foolishness is not a talent.

jason123:

Nosa, I have a question for you:

If I am your father(president) and you are my son (masses). When you go to school (Nigeria), I give you some money for your feeding(subsidy) since they do not provide food in school(constant electricity, good roads, etc) and as you get to school, a bully( Cabal) takes that money away from you. Should I, the father stop giving you money or should I tackle the bully?

Kai! your analogy is poo.
1. SUbsidy money was not for making up for bad roads and epileptic electricity etc.

2. The bully you termed the cabal can easily be pointed out and dealt with in school wheres as it applies to Nigeria, finding them out might end up being a one-point-agenda of a full presidential tenure. A time we (nigeria) dont have!

3. Even if the bully shiit stands, why would your dad continue giving you money (which the bully will steal anyway) before tackling the bully and why not after tackling the bully.

Ol boy, find another one jare.

Question for the Op, beaf and supporters
Why did subsidy cost increase from about 300 billion to over 1.5 trillion?

@A-ZeD the sum of 300b was the budget for 3 months and not the full year

What is the point of discussing this issue when the outcome of this country is certain. Everywhere in the world they are cutting the size of government and here we are increasing the size of government everyday and selling our souls to politics especially at the centre. My mum used to say if you cannot do anything for yourself you can pay for it but by all means you will pay for it. Welcome to the end times with Nigeria leading the charge.

nosa2:

@A-ZeD the sum of 300b was the budget for 3 months and not the full year

it was 300b during Yar'Adua's regime.

this subsidy thing dey tire me oh!!!!

the main problem in Nigeria is management of funds!!! we dont know how to manage funds. everybody is looking for a way to go home smiling. the person that said "every Nigerian is a thief. if anyone of us says the contrary is just because he/she has not had the opportunity" is not lying. well i just pray that in a matter of time they can take their time and remove the subsidy slowly and gently provided we get to see where the money intended for subsidy is going to.

@Nosa,
Do you think the govt has the moral right to ask Nigerians to bear the brunt when as admitted by the CBN governor, none of the ministers,governors, VP or President takes money out of his pocket to buy fuel? Meanwhile we all see the number of cars that go with an ordinary LG convoy. In essence when you pay your tax and when you pay for that subsidy-less fuel, you are not only paying for fuel in your car but also for the cars your leaders are driving.

Secondly, subsidy has been removed from diesel and kerosene for over a year now, have you seen any of the benefits? Has anyone from govt provided a balance sheet to tell us what they have done with the money saved?

Thirdly, you said pensioners are to blame for supporting military rule and for aligning with corrupt governments. Well, this time, they have decided not to align with this corrupt government and you still blame them? In addition, how exactly are they to blame? Someone keeps their pensions in his/her account for months/years so as to pocket the accrued interests and nothing is done to him. How exactly is this the pensioner's fault?

Nosa,the analogy is very logical.it is either u find thinkin deep a hardwork or u don't know the reality on ground in nigeria.I'd prefer the first

proudly9ja:

@Nosa,
Do you think the govt has the moral right to ask Nigerians to bear the brunt when as admitted by the CBN governor, none of the ministers,governors, VP or President takes money out of his pocket to buy fuel? Meanwhile we all see the number of cars that go with an ordinary LG convoy. In essence when you pay your tax and when you pay for that subsidy-less fuel, you are not only paying for fuel in your car but also for the cars your leaders are driving.

Secondly, subsidy has been removed from diesel and kerosene for over a year now, have you seen any of the benefits? Has anyone from govt provided a balance sheet to tell us what they have done with the money saved?

Thirdly, you said pensioners are to blame for supporting military rule and for aligning with corrupt governments. Well, this time, they have decided not to align with this corrupt government and you still blame them? In addition, how exactly are they to blame? Someone keeps their pensions in his/her account for months/years so as to pocket the accrued interests and nothing is done to him. How exactly is this the pensioner's fault?

God bless you.

useless topic
why must feeding and other expenses (fueling,newspaper)be on the national budget?
were they not being paid salary?

I wonder why we have to start all over on this issue?
We all know the truth: Government have no business asking us to subsidise for its inability to tackle the so-called 'cabal'

Nigeria na wa ooo

What infrastructures has this government provided by the removal of subsidy from Kerosene and Diesel.
Our government is just deceiving us. There is no subsidy in Nigeria. How can you subsidise inefficiency three non working refineries. How can you subsidies Crude oil taken from Bayelsa. It is all fraud and embezzlement of highest order. A day will come when they will tell us they are subsidising water and oxygen.

Hmm. . . . Obviously someone did not calculate the actual cost to subsidize fuel in Naija and not the cost that the government gives us. . .

Stupid post

@Nosa, we have been thru this before, Why would anyone ask us to increase our sufferings whilst they continue to enjoy and loot our common wealth?

Once the govt is sincere we would all know and till then, Subsidy on my Water, education, housing, security, kerosine have all nbeen removed in the past whilst they still enjoy theirs ,

Animal Farm Indeed!!

EFCC1:

useless topic
why must feeding and other expenses (fueling,newspaper)be on the national budget?
were they not being paid salary?

[size=15pt]i tire oh!!!![/size]

@nosa2. . . Just one question for you. Have u thought about the adverse effect of this your deregulation?

The way i see this, Nigeria is headed in the direction of Greece. We believe oil will never dry up and that government owes us the duty of putting ready made food in our mouths. The #OccupyNigeria protest was bastardised by the people who sponsored it in the first place. How can i who is educated and knows what has been happening and whats still happening in Nigeria listen to someone like Dino Melaye, El Rufai etc. The #Occupy, theme in other countries was more about fight against corruption not subsidy, If only we had Occupied IBB's house, Abacha's house, Buhari's house, and every other person, whether minister or permanent secretary, as far as you were in government: this would have made perfect sense. Now everyone blames GEJ for the woes of past leaders, Abegi i get better hand work.

Being Text of Speech delivered live at the Latterrain Assembly, Lagos, Nigeria – Sunday, January 15th, 2012.

1. DefinitonTo subsidise is to sell a product below the cost of production. Since the federal government has been secretive about the state of our refineries and their production capacity, we will focus on importation rather than production. So, in essence, within the Nigerian Fuel Subsidy context, to subsidise is to sell petrol below the cost of importation.





2. The Unsubstantiated Claims of the Federal GovernmentThe Nigerian government claims that Nigerians consume 34 million litres of petrol per day. The government has also said publicly that N141 per litre is the unsubsidised pump price of petrol imported into Nigeria. (N131.70 kobo being the landing price and N9.30 kobo being profit.)





3. Annual Cost of ImportationDaily Fuel Consumption: 34 million litres
Cost at Pump: N141.00
No. of days in a regular year: 365 days
Total cost of all petrol imported yearly into Nigeria:

Litres Naira Days
34m x 141 x 365 = N1.75 trillion





4. Cost borne by the ConsumerNigerians have been paying N65 per litre for fuel, haven’t we? Therefore, cost borne by the consumers =

Litres Naira Days
34m x 65 x 365 = N807 billion





5. Cost of Subsidy borne by the ConsumerIn 2011 alone, government claimed to have spent N1.3 trillion by October – the bill for the full year, assuming a constant rate of consumption is N1.56 trillion.

Consequently, the true cost of subsidy borne by the government is:
Total cost of importation minus total borne by consumers, i.e. N1.75 trillion minus N807 billion = N943 billion.

Unexplainable difference: N617 billion

The federal government of Nigeria cannot explain the difference between the amount actually disbursed for subsidy and the cost borne by Nigerians (N1.56 trillion minus N943 billion = N617 billion).





6. Bogus Claim by the GovernmentA government official has claimed that the shortfall of N617 billion is what goes to subsidising our neighbours through smuggling. This is pathetic. But let us assume (assumption being the lowest level of knowledge) that the government is unable to protect our borders and checkmate the brisk smuggling going on. Even then, the figures still don’t add up. This is because even if 50% of the petrol consumed in each of our neighbouring countries is illegally exported from Nigeria, the figures are still inaccurate. Why?

World Bank’s Figures : Populations of West African Countries

Nigeria 158.4 million
Benin 8.8 million
Togo 6 million
Cameroun 19.2 million
Niger 15.5 million
Chad 11.2 million
Ghana 24.4 million
The total population of all our six (6) neighbours is 85.5 million.

Let’s do some more arithmetic:

a. Rate of Petrol Consumption in Nigeria: Total consumed divided by total population:
34 million litres divided by 158.8 million people = 0.21 litres per person per day.

b. Rate of Petrol Consumption in all our 6 neighbouring countries, assumed to be the same as Nigeria:
0.2 litres x 85.5 million people = 18.35 million litres per day

Now, if we assume that 50% of the petrol consumed in all the six neighbouring countries comes from Nigeria, this value come to 9.18 million litres per day.





7. Pathetic AbsurdityThere are two illogicalities flowing from this smuggling saga.

a. If 9.18 million litres of petrol is truly smuggled out of our borders per day, then ours is the most porous nation in the word. This is why: The biggest fuel tankers in Nigeria have a capacity of about 36,000 litres. To smuggle 9.18 million litres of fuel, you need 254 trucks. What our government is telling us is that 254 huge tankers pass through our borders every day and they cannot do anything about it. This is not just acute incompetence, but also a serious security challenge. For if the government cannot stop 254 tanker trailers from crossing the border daily, how can they stop importation of weapons or even invasion by a foreign country?
b. Even if we believe the government and assume that about 9.18 million litres is actually taken to our neighbours by way of smuggling every day, and all this is subsidised by the Nigerian government, the figures being touted as subsidy still don’t add up. This is why:
Difference between pump price before and after subsidy removal =
N141.00 – N65.00 = N76.00

Total spent on subsidizing petrol to our neighbours annually =
N76.00 x 9.18 million litres x 365 days = N255 billion

If you take the N255 billion away from the N617 billion shortfall that the government cannot explain, there is still a shortfall of N362 billion. The government still needs to tell us what/who is eating up this N362 billion ($2.26 billion USD).

List item goes here




8. Illogical Assumptionsi. We have assumed that there are no working refineries in Nigeria and so no local petrol production whatsoever – yet, there is, even if the refineries are working below capacity.
ii. Nigeria actually consumes 34 million litres of petrol per day. Most experts disagree and give a figure between 20 and 25 million litres per day. Yet there is still an unexplainable shortfall even if we use the exaggerated figure of the government.
iii. Ghana, Togo, Benin, Cameroun, Niger, and Chad all consume the same rate as Nigeria and get 50% of their petrol illegally from Nigeria through smuggling.
These figures simply show the incompetence and insincerity of our government officials. This is pure banditry.




9. Fact 9The simplest part of the fuel subsidy arithmetic will reveal one startling fact: That the government does not need to subsidise our petrol at all if we reject corruption and sleaze as a way of life. Check this out:

a. NNPC crude oil allocation for local consumption = 400,000 barrels per day (from a total of 2.450 million barrels per day).
b. If our refineries work at just 30%, 280,000 barrels can be sold on the international market, leaving the rest for local production.
c. Money accruing to the federal government through NNPC on the sale, using $80/bbl – a conservative figure as against the current price of $100/bbl – would be $22.4m per day. Annually this translates to $8.176bn or N1.3 trillion.
d. The government does not need to subsidise our petrol imports – at least not from the Federation Account. The same crude that should have been refined by NNPC is simply sold on the international market (since our refineries barely work) and the money is used to buy petrol. The 400,000 barrels per day given to NNPC for local consumption can either be refined by NNPC or sold to pay for imports. This absurdity called subsidy should be funded with this money, not the regular FGN budget.
If the FGN uses it regular budget for subsidising petrol, then what happens to the crude oil given to NNPC for local refining that gets sold on the international market?




10. Tactical BlunderThe federal government is making the deregulation issue a revenue problem. Nigerians are not against deregulation. We have seen deregulation in the telecom sector and Nigerians are better for it, as even the poor have access to telephones now right before the eyes of those who think it is not for them. What is happening presently is not deregulation but an all-time high fuel pump increase, unprecedented in the history of our nation by a government that has gone broke due to excessive and reckless spending largely on themselves. If the excesses of all the three tiers of government are seriously curbed, that would free enough money for infrastructural development without unduly punishing the poor citizens of this country.

Let me just cite, in closing, the example of National Assembly excesses and misplaced spending as contained in the 2012 budget proposal:

1. Number of Senators: 109
2. Number of Members of the House of Representatives: 360
3. Total number of Legislators 469
4. 2012 Budget Proposal for the National Assembly N150 billion
5. Average Cost of Maintaining Each Member N320 million
6. Average Cost of Maintaining Each Member in USD $2.1 million/year



Time has come for the citizens of this country to hold the government accountable and demand the prosecution of those bleeding our nation to death. Until this government downsizes, cuts down its profligacy and leads by example in modesty and moderation, the poor people of this country will not and must not subsidise the excesses of the oil sector fat cats and the immorality cum fiscal scandal of the self-centred and indulgent lifestyles of those in government.

Here is a hidden treasure of wisdom for those in power while there is still time to make amends:

PROVERBS 21:6&7

“Getting treasures by a lying tongue is the fleeting fantasy of those who seek death. The violence of the wicked will destroy them because they refuse to do just”
A word of counsel for those who voted for such soulishly indulgent leadership:

“trust a man who once had no shoes, or you may end up losing your legs”
This is the conclusion of the matter on subsidy removal:

i. “If a ruler pays attention to lies, all his servants become wicked.” (Proverbs 29:12)
ii “The Righteous God wisely considers the house of the wicked, overthrowing the wicked for their wickedness. Whoever shuts his ears to the cry of the poor will also cry himself and will not be heard.” (Proverbs 21:12&13)
Thanks for your attention. God bless you all.

Pastor ‘Tunde Bakare
Sunday, January 15, 2012

^^^^^^^^
That my guy is the true cost of subsidizing fuel; and that is after too much has been taken for granted

I would advice Beaf and the boys he has in his employment to find something better to do with their time.
Or else you pay dearly for the Nigerian people's money you are gulping and then working against their interest!

@Demdem, thank you for the title. You seem not to get the point, since you are so uneducated as to ascertain my point, let me put it to you this way. I don't care what we consume. #OccupyNigeria was suppose to be the masses fighting against corruption in all sectors in Nigeria, not a cheap ticket to surviving, not Labour Leaders who know nothing about the masses but go around Occupying mansions and claiming to be on the side of the people and saying "We were not involved in the N97 a litre price by government". Please go to school,