Deregulation, Removal of Subsidy on Petroleum Products: The End of A Struggle

SGF, Boss Mustapha
Chris Ngige, Minister of Labour & Employment
  • What Does FG-Labour’s Agreement Translates To for Workers

IT has been fire and fury, contestations and interventions in social media

An un-credited cartoon that went viral after organised labour suspended its nationwide strike and protest billed to commence on Monday, September 28, 2020.

platforms, especially those operated by labour and civil society advocates and communities, since Nigerians woke up on Monday morning to the news that leaders of organised labour called off the much hyped nationwide strike and protest just a few hours to take off.

In place of the strike and protest as a package of resistance against the recent hikes in the pump price of petrol and electricity tariff, the public was presented with a communiqué that outlined points of agreement between the federal government and the leadership of NLC and the Trade Union Congress of Nigeria (TUC).

There are two major strands in the discourse. While the first strand of the debate and contestations centre around the nuances of what many described as the abrupt suspension of the strike after working class organisations – which include trade unions and civil society allies as well as the general public – have been fully mobilised; the second strand of the argument focus on the evaluation or quantification of the agreement between the labour leaders and the representatives of government in terms of tangible benefits for workers and the masses in general.

On the abrupt nature of the suspension

The school of thought that the strike and peaceful protest were abruptly suspended believe that the labour leaders do not in themselves possess the power to suspend the strike since the decisions by the two labour centres (NLC and TUC) were ab initio taken by their organs.

For proponents of this view, the right thing the NLC and TUC leaders ought to have done was to have reconvened either a joint emergency meeting of the two centres’ National Executive Council (NEC), or at the level of each centre, to critically debate the offers made by government and obtain fresh mandates on those offers before putting pen to paper.

National Record gathered that that has been the tradition in the trade union movement in every negotiation, both at union and centre levels. The representative opinion of this school of thought came from a president of an affiliate union of NLC and as a result a member of NEC of Congress. He however pleaded anonymity on the claim that he was not authorised to speak on the matter and could therefore be sanctioned if named.

He told National Record that what representatives of organised labour did by unilaterally

Comrade Wabba, NLC President

going ahead to enter into an agreement with government was clearly disrespectful of not only their colleagues at the executive level of the centres but more so of the statutory organs through which decisions are taken in between delegates conferences. He however noted that the action may not be a violation of any portion of the constitutions of either the TUC or NLC, even if it seems discourteous and unilateral.

“As a president of my union, if I am mandated along with some of my elected colleagues to go and negotiate on the basis of a particular position, we are not supposed to accept any offer other than the one agreed at that organ without recourse to the same organ that gave us that mandate. We will be on our own if we do that.

“Even if we consult in the course of the negotiation and seem to get the acceptance of

Comrade Olaleye, TUC President

majority of our members, the basic principle is always that we prevail on our employer to allow us to go back to the organ that in the first instance gave us the authority to get a fresh mandate; no matter the pressure. That is just common sense, a rudimentary ethic that naturally protects union leaders from not just the overbearing influence of the employers, but also from being maligned and accused of being bought.

“You know, when devious employers, government and its agencies or even private employers, know or form the opinion that you can take decisions without recourse to your organs, they can utilise it to their advantage and very often, this stokes internal crisis in unions,” the union president posited.

He said a number of union presidents were not carried along in calling off the impending nationwide strike, but only got the news of the suspension from the media when they were set to move out for the peaceful protest.

A number of state chapters of the NLC and TUC as well as civil society allies confirmed to our correspondents that they got the news of the suspension through the social media. According to them, it was unfortunate that after spending huge resources in mobilisation and other preparations, the leadership of NLC and TUC did not give room for people to demonstrate the degree of broad national revulsion on the policies of the Buhari administration.

What are the tangible benefits of the agreement?

In virtually every social media platform and discursive fora, the broad consensus was that the agreement reached with government was not worth the paper it was written on. While conversations in many fora literally trended on allegations that representatives sold out, there were a few in which discussions were conducted in modest and decent tones, although often moderated with bitterness and sarcasm.

In addition to the above follow the anger and disappointment by many that Nigerians have been denied the opportunity of using the platform of the protests to send a strong message to the Buhari government through a broad national discontent as a response to its failure vis-à-vis his promises.

Beyond that is also the underlying notion in the progressive community to use the general strike and nationwide protests to demonstrate workers and peoples power to the ruling elite in Nigeria, that the decades old struggle against neo-liberalism, particularly against the deregulation of the downstream sector of the petroleum industry, remains alive and not dead as may have been contemplated by the Buhari regime.

But as it is, all that may have come to a final close and the agreements between labour and government may have put a final nail on the coffin of that popular struggle.

In that sense, the Buhari Presidency has achieved a historic feat, being the only government, either military or civilian, to have very effectively contained and tethered organised labour and what had seemed to be an unconquerable Nigeria Labour Congress, which has championed that struggle and cause of the masses by leading them over the decades against every government’s unrestrained quest to extend the frontiers of neo-liberalism.

This is very clearly illustrated in the agreement or communiqué between the government and representatives of labour through which the nationwide strike and protests will remain a dream.

Why tariff increase on electricity will remain

The core of the joint communiqué, after the usual nuanced background and introductory remarks, noted, on the demand for total reversal of electricity tariff, that: “The parties agreed to set up a Technical Committee comprising Ministries, Departments, Agencies, NLC and TUC, which will work for a duration of two (2) weeks effective Monday 28th September 2020, to examine: the justifications for the new policy in view of the need for the validation of the basis for the new cost reflective tariff as a result of the conflicting information from the fields which appeared different from the data presented to justify the new policy by NERC; metering deployment, challenges, timeline for massive roll – out.”

From the terms of reference (ToR) of the technical committee, which has two representatives of NLC, one from TUC, four from government and one representative for all the DISCOs (our interpretation, as it might be interpreted as one for each of the about eleven DISCOs), it is obvious that its purpose is only diversionary as there are several germane issues that are not included in the ToR and even if included, the recommendations are only advisory in nature and has no legal force.

Beyond this point is the indication in the same communiqué which signposts government’s duplicity on the suspension of the tariff. Whether intentional or inadvertent, it is surprising that nobody on labour’s side was able to note that included in the communiqué under section C, in the introduction to its offers, is a conclusive position of government and the DISCOs on the electricity tariff hike, where it stated thus: “To cushion the impacts of the downstream sector deregulation and tariffs adjustment in the power sector, the Federal Government will implement the following…”

This therefore forecloses any deception that a certain committee was going to “examine the justification for the new policy on cost-reflective Electricity Tariff adjustments” to favour labour’s demands.

More so, as indicated in the ToR, representatives of labour may just be mere rubber stamps as the work they are appointed to carry out clearly are exercises in futility and actually with the purview of the legislature with the tariff and metering components being perhaps the only exceptions, and which rigorous resistance could only have remedied.

The ToR include: “To examine the justification for the new policy on cost-reflective Electricity Tariff adjustments.

“To look at the different Electricity Distribution Company (DISCOs) and their different electricity tariff vis-à-vis NERC order and mandate.

“Examine and advise Government on the issues that have hindered the deployment of the six million meters.

“To look into the NERC Act under review with a view to expanding its representation to include organized labour.”

While the technical committee has two weeks within which to work and submit its report, a period in which “the DISCOs shall suspend the application of the cost-reflective Electricity Tariff adjustments,” up to the time of going to press (more than 36 hours after the communiqué was signed an released), the DISCOs were yet to suspend the increased tariff on the claim that they have not been officially communicated.

In addition to the concern that the real concerns of workers bordering on the cost of electricity have not been addressed, the question of membership of board of DISCOs being part of the terms of reference, along with the revival of the moribund National Labour Advisory Council (NLAC) are issues which many people feel are unrelated to the economic concerns of workers.

Full deregulation, total subsidy removal endorsed

By the wordings of the communiqué, both the NLC and TUC are now fully in support of full deregulation of the downstream sector of the petroleum industry and total removal of subsidy on petroleum products.

The opposition to these twin neo-liberal policies of every government, it must be emphasised, has, for over three decades, defined the popular image of the NLC and the integrity of trade union leaders in how dedicated and forthcoming they are in rallying the structures of the centre and its affiliates in their resistance.

It is in this historic context that many see the communiqué that announced the agreement more as both “the voice and hand Esau” as the syntax and semantics of the communiqué trended practically on the trajectories and narratives of every government from the 1970s.

The communiqué pandered to the same neo-liberal spirit, but missing out on the essential philosophy and logic of labour’s interventions at every moment in the history of the struggle against subsidy withdrawal and deregulation. Labour, it seems, may have been convinced by Buhari government’s half-hearted miming and tragically abandoned what it had repeatedly espoused for ages.

For instance, the communiqué states, among other things that: “Consequent upon the critical review of the various challenges of the downstream sector of the Nigeria oil and gas industry vis a vis [sic] the incalculable losses associated with a subsidy regime the Country has been incurring in terms of stifled growth in the downstream sector, diminished human capital development and massive financial leakages and flight. This is in addition to the dire financial circumstances of the Federation that precludes any ability to sustain any subsidy on PMS and making deregulation of PMS inevitable. Consequently, the Parties agreed to the following:

“1. All parties agreed on the urgency for increasing the local refining capacity of the nation to reduce the overdependency [sic] on importation of petroleum products to ensure energy security, reduce cost of finished products, increase employment and business opportunities for Nigerians.

“2. To address (1) above, NNPC to expedite the rehabilitation of the nation’s four refineries located in Port Harcourt, Warri and Kaduna and to achieve 50% completion for Port Harcourt by December 2021, while timelines and delivery for Warri and Kaduna will be established by the inclusive Steering Committee.

“3. To ensure Commitment and transparency to the processes and timelines of the rehabilitation exercise, the management of NNPC has offered to integrate the national leadership of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) and Petroleum and Natural Gas Senior Staff Association (PENGASSAN) into the Steering Committee already established by the Corporation.

“4. A Validation team comprising the representatives of the NNPC, Nigeria Extractive Industries Transparency Initiative (NEITI), Infrastructure Concession Regulatory Commission (ICRC), NUPENG and PENGASSAN will be established to monitor progress of the rehabilitation of the refineries and the pipelines/strategic depots network and advice the Steering Committee periodically.

“5. Post rehabilitation, NNPC shall involve the PENGASSAN and NUPENG in the process of establishing the operational model of the Nation’s refineries.

“6. The Federal Government will facilitate the delivery of licensed modular and regular refineries, involvement of upstream companies in petroleum refining and establishing framework for financing in the downstream sector.

“7. NNPC to expedite work on the Build Operate and Transfer framework for the nation’s pipelines and strategic depots network for efficient transportation and distribution of Petroleum products to match the delivery timelines of the refineries as agreed.

“8. The Federal Government and its agencies to ensure delivery of 1 million CNG/LPG AutoGas conversion kits, storage skids and dispensing units under the Nigeria Gas Expansion Programme by December 2021 to enable delivery of cheaper transportation and power fuel. A Governance Structure that will include representatives of organized Labour shall be established for timely delivery.”

It is in the context of the above concessions given by the leadership of organised labour that a cartoon surfaced and quickly went viral on the social media satirising what it depicts as NLC’s duplicity with the federal government throwing at it a piece of bone or meat. Symbolised as a bulldog, the NLC, first stopped barking after sighting the bone, then eventually turned against the people after the piece of bone or meat had disappeared.

The piece of bone or meat the cartoonist may have imaginatively captured should not be far from the outlined palliatives ranging in form of some intervention fund for workers, tax holidays on minimum wage, housing and provision of mass transit buses to labour.



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