“Why I Started War Against Subsidies”- Sanusi Lamido Sanusi

. What He Told Street Journal

. How Obasanjo Subverted Due Process

In an e mail sent to Street Journal by the Governor of the Central Bank, Sanusi Lamido Sanusi, the nation’s number one banker took time to explain his role and why he started the war against subsidies. He also explained the rot in the petroleum sector and the frauds perpetrated in order to benefit from fuel subsidy. Below are excerpts from the mail:

“If you will patiently read this mail to the end you will understand my position. I won’t be able to repeat everything I have said over the past few years on fuel subsidy, but in summary; Fraud like theft thrives not only because of the existence of greed and benefit but of opportunity. Place yourself in the shoes of the average Nigerian “businessman” or “entrepreneur”-polite euphemisms for rent seeking parasites. You establish an elcee for importing 20,000MT of PMS and the PPPRA says this is at a landed cost of N145 for example per litre. So you know that for every litre in that vessel you will get at least N85 as subsidy. Now you have a number of “possibilities”: 1. You can offload 5,000 MT and bribe customs and other officials to sign papers confirming you offloaded 20,000 MT. Then do the same across the chain with a paper trail showing you delivered 20,000 MT to a tank farm, and maybe even that you transported it to Maiduguri entitling you to a share of the price equalization fund. Maybe for N20-N30 per litre you bribe all those who sign the papers. The 15,000 MT you take to Benin or Ghana or Cameroun and sell at market price thus making an additional “profit” of N55/ltr on 15,000MT! 2 you can just forge documents and have them stamped without bringing in anything and collect the subsidy-PPPRA pays based on DOCUMENTS. 3 you can bring in the fuel, load on tankers, sell some at N65N some at 80 some at 100 some across the land borders. You can do all this and no one can catch it or prove it because somebody was paid to sign off on documents. And with a high enough margin, there is too much temptation to be resisted and firepower for bribing officials. When I spoke to the House of Reps I told them why I was suspecting fraud. It starts from PPPRA “allocations” based on “capacity”. You will find a company like Mobil with capacity for say 60,000 MT and a relatively unknown name with a capacity of say 90,000 MT. Red alert number 1. Although PPPRA is supposed to give license only to marketers with a national distribution network you see names of companies where you have never seen a filling station in their name. I was a Chief Risk Officer in UBA and in FBN for many years approving loans so I know the name of every big player in every industry that Nigerian banks lend to as these are among the biggest banks in the country. I see names on the list I don’t recognise either from portfolios. I looked at or industry studies over the years. Red alert number 2. I studied the papers presented to PPPRA in a short period in 2010 (I won’t tell you how I got them!). And I was surprised that on some days over 10 vessels are said to have discharged cargo in Lagos on the same day-clearly the same officers stamping and “verifying” that the vessels were SEEN. Is it really realistic that on the same day 13-15 vessels can discharge in Lagos? Red alert number 3. Why was I interested in fuel marketing. Because the two sectors that led to the near collapse of the banking industry were capital markets and oil marketing. I am not giving any confidential info out as AMCON MD has already disclosed publicly that two companies alone-Zenon and AP-owned by the same businessman owed the Nigerian banking industry N220b. And we all saw the amount of subsidy paid to those companies published by BusinessDay. So money had been taken, subsidy had been collected but loans were not repaid, and we couldn’t see the money either as product in tank farms or in fuel stations or credit sales. So I became obsessed with trying to understand how that industry operated and the more I saw the more I hated it and I started the war against subsidies. It is actually better So yes, I am willing to take all the criticism and labels and be unpopular but this has to stop and govt can find other ways of alleviating pain. Iran removed subsidies and started cash transfers directly to the poor. It is up to fiscal authorities to figure out safety nets but from where I sit and what I know this decision is not only correct but necessary and overdue. I also confirm that I have revealed nothing here I haven’t spoken about before in public and it is just that Nigerians never listen! I am not complaining about insults I am used to that. I just believe that an insult is not an argument and when people resort to personal abuse they have run out of logic.  But to then go beyond me and extend it to my dead grandfather and his “descendants” ie my late father his siblings etc I think goes beyond the pale. As a Nigerian-and as an economist- I can take a position on economic matters and this position is one I have had for years even before coming in to the Central Bank.  I have also explained the position on several occasions and criticised government for not doing this before. In 2010 at a public hearing in the House of Reps on the 25% saga I alerted the nation of what I considered a potential big scam around subsidies and urged for its removal. No one paid attention. The economics is very clear to me. That it is unpopular is also understandable.  The British public is unhappy with Tory budget cuts. The Greeks went on riot over austerity. Italian parliamentarians came to blows before Berlusconi was thrown out of office. The US congress is yet to approve Obama’s tax increases. Economic decisions-by definition-ALWAYS must involve a cost or an opportunity cost since for them to qualify as economic they must involve a choice in resource allocation among competing uses. An enlightened debate is one that weighs the pros and cons of removing subsidy and continuing with it. So I became obsessed with trying to understand how that industry operated and the more I saw the more I hated it and I started the war against subsidies. I started the war against subsidies. It is actually better to do a direct cash payout or add a line item to salaries called petroleum support or transport allowance capped at say N300b p/a than to keep paying it. It goes to pay middle men, rent-seekers and corrupt officers and there is no amount of preaching that will stop this fraud so long as the policy is so badly defined. Every time oil price goes up and every time the naira is devalued and every time the quantity of imports increases the “subsidy” and thus the “rent” increases and there is more gravy to go round. So every year we “import” more and more and deplete our reserves, and the government borrows more and more to pay for subsidy and the beneficiaries are a small group of marketers, govt officials and neighbouring countries which get fuel without losing forex! And while a person who applies intelligence can see what is happening, you can’t prove it in a court of law. If the man says he sighted the vessel and it was 20,000MT you have to accept it. It was a year ago! So for two years I have been convinced that this thing is a scam and that it cannot be stopped because the entire controls have been compromised. NNPC sells domestic crude, pays whatever subsidy PPPRA says and then gives the balance after JVC to the Federation Account. And while Fani Kayode is right to speak up, the truth is that it was Obasanjo who first subverted the process by allowing NNPC to make the deductions before paying into Federation Account. Because once money goes into that account it is to be shared among 3 tiers of government so strictly speaking the deductions have always been unconstitutional as the FG was paying subsidy on behalf of itself and state and LGs without their approval. So yes, I am willing to take all the criticism and labels and be unpopular but this has to stop and government can find other ways of alleviating These are all valid issues that are to be taken IN ADDITION to and not in place of subsidy removal.  Since someone has decided to make insinuations about my grandfather I owe it to him to defend his record. It was my grandfather as emir that repealed an obnoxious rule started from the days of Emir Usman that disenfranchised women from inheriting property. It was Sanusi that built the groundnut pyramids to the point where Kano NA was contributing 40pct of the revenues of the northern region. It was Emir Sanusi who built the Bompai Industrial Estate, and turned Kano into the industrial nerve centre of the north. He was Acting Governor of the Northern region, Minister for Pilgrim Affairs, Chief Imam of Friday mosque, judge and leader of the Tijjaniya order. As for his “descendants” my father was one of the very first batch of 12 Nigerians recruited by the British to set up the foreign service in 1957 and he remained in public service and rose to be Permanent Secretary before retirement. He set up in the 60s the Research Department of the Ministry- the present NIA so he was the first external intelligence officer in Nigeria. As Permanent Secretary, he was the architect of Murtala Mohammed’s policy on decolonisation of Africa and oversaw the independence of Mozambique and Angola and the final push to liberate Zimbabwe and South Africa. So yes Sanusi was not perfect. He was a feudal aristocrat. And my father was not perfect. He was also a prince and privileged to go to Oxford and LSE. But please if you want to abuse my grandfather and father kindly tell us what contributions your own grandfather and father made to the people.”
Sent from my BlackBerry® wireless handheld from Glo Mobile.

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  • Anonymous

    your father and grandfather was able to do that because they were given the chance to do it because of the influence they had. Some of that you enjoyed as well.There are thousands of Nigerians who could do a better job who did not get a chance to attend schools that your parents went and have the influence they had and you have. I am arguing against removal of fuel subsidy because i understand in right direct but it is illtimed. There are a lot that should have been done to reduced the sufferings of the nation before it is done. The buses should have been brought in first. And your explanation here should have come to the public domain before the subsidy was removed. I expect the president to have organised a lot of talks to educate people from place to place to know the reality behind this step. Also, i feel more things should have been done in terms of health and education to reduce the presssure for ordinary Nigerians. Do you think the 18.000 minimum wage can solve this problem. You have looked at the issue on one side. I prays the issue is sorted peacefully.

  • http://pulse.yahoo.com/_PRNWVVQOCUTUEUQRA6DVCJK4VI James Banjo

    I want to commend Lamido Sanusi Lamido for the passion and the courage he has to talk and expose evil and corruption both in the banking sector and the oil sector. Many privileged Nigerians like him- by birth and position- of Northern and Southern origins would never mind to pursue issues he stood for because they are never affected. There are even many of these so called privileged Nigerians who benefited immensely from Nigeria and even stole from Nigeria who when they set up their businesses out of ill gotten wealth will never see their workers as human beings but slaves, never-do-wells, and will shortchange them severally and turn again and call themselves devoted Christians or Muslims.

    The truth is that there is no better time for fuel subsidy removal than now. We all should brace up for the challenges ahead and be more involved in monitoring our leaders closely than ever before. Long live Nigeria!

    • Anonymous

      u people better find a better solution to the suffering in Nigeria instead of pretending to be holier than u are. All of u are bunch of failures, thieves and evil minded people. Please sanusi just make sure that ur ass is clean before u tell someone else that his own ass is dirty. I cant see a clean Poilitician yet in Nigeria so tell me another story instead of this. I leave in Europe and i cant tell u that this are founded excuses for ur actions. U cant present this in Europe as an excuse. Please try to find a better way to tackle this mess cos i cant see u winning it by this method. If u cant expose this people who are stealing then better off resign from ur post so that i can see u as a holy person who refused to be part of corruption. This is how it is done in Western world. Expose them or leave instead of suffering the whole masses cos u think u can fight corruption while ur ass is dirty too.

      • Anonymous

        Lamido Sanusi, you are a disappointment, if you actually said all that is posted here! Kai! What kind of government are you defending? The government that strikes a blow at the foundations of the economy of the common man without giving adequate warnings? The examples of foreign country policies that you sited are just totally offpoint. In none of those instances that you sited did the average inflation rise 100% overnight!!! And the people resisted it so much!!!! Do you think if we were a truly credit run society, a 100% inflation in 24 hours could be workable at all? You are full of so much bullshit!! Your arguments for the evil of oil subsidy on the surface are very understandable, but you are obviously just a silly, brilliant economist, you know nothing about politics!!! And next time, you just stick to your economics and leave the politics to professionals. How could you support a move that raises inflation by 100% OVERNIGHT???? It is so sad. Thank God Nigerians are seeing through the veil used to cover their eyes, and are standing up to an evil, autocratic, spineless government that is so irresponsible that it cannot fight corruption, but will rather use corruption to perpetuate suffering amongst its masses. Transportation costs doubled overnight, staple food costs doubled, even sachet water cost doubled!!! Businesses whose fundamentals are based on transportation are forced to either increase prices or reduce production, and all you say is subsidy removal is long overdue! Its a real shame the kind of technocrats we have working for government.

        • http://pulse.yahoo.com/_POHXI7ED2YWEYWGDVQ6MWXCH4Q williams

          @Olatunjioladeji.
          Thanks brother. I think U made a mistake anyway. Sanusi is not an Economics like that, what he study is Islamic whateva in Sudan. The Economics did not interest him, is learning it on the job so he could you use it to get back to people ( Biz-men ) that wrong him or/and his father in the past.

          • http://twitter.com/234mayor01 Okeyoyin Olumayowa A

            I don’t understand what you people are talking about. The only thing I have been able to pick from Sanusi’s argument is that there is corruption every where. So why not tackle the issue of corruption at all level of governance and leave the common masses alone. If the Government has failed to implement any reasonable project in the past, what assurance do we have now that she will implement her promises with respect to money saved through subsidy removal? Oshisko

  • Ayodeji Aladejebi

    I am against subsidy removal however after reading I became very enlightened on the issue. However, my question: If you removed subsidy because you are trying to curb corruption in the petroleum sector, that same corruption will leave the petroleum sector to re-appear wherever that subsidy money is going so that at the end of the day, we are still where we were. The govt is not addressing the real issue: It is called Corruption.

  • http://pulse.yahoo.com/_IYSNFUCRG4OET4GSLUQGCBXR4E Afloww

    Definitely sir, you have a point and yes, subsidy must and should be removed.
    How come only that part of your recommendation was implemented.
    How come we don’t see the necessary cuts in spending and allowances by political office holders.
    How come the so called minimum wage is yet to be paid, and where they actually say it is paid, the accounts are so muddled up you don’t know what is being paid.
    Then, why can’t government have a plan to remove this subsidy gradually.
    Thank you.

  • http://www.facebook.com/cojuroye Chuck Ojuroye

    In this piece, Lamido was too egoistic, a crass economist.. We are now saddled with a twin evil; high inflation and devaluation of currency..Yes the Subsidy was riddled with fraud, do we now need to pass on the burden of government incompetency to the innocent citizens.. Whilst, I see some merits in the pro-subsidy removal movement rhetoric, it is simply not a recipe for a knee jack reaction policy. No one has been brought to justice over this matter of cabals and yet the public again, is been punished for an incompetent Government and a clearly incompetent CBN Governor.. Your position would not have been tenable, if you were Governor of Bank of England or Fed Reserve chief!

  • http://www.facebook.com/people/Emeka-Ezinwa/571635744 Emeka Ezinwa

    Utter nonsense.He says he has got the documents detailing corruption in the oil sector and its perpetrators. So why not go after them, recover the funds and try and clean up the sector? The key word here is corruption, and not the removal of the subsidy. The downstream oil sector should have been better regulated. The Nigerian populace can not be made to pay for the failures of government.

    • http://www.facebook.com/people/Saleh-Maitala/1354879112 Saleh Maitala

      Is it His Duty to go after each and every perpetrator? Is he the petroleum minister? Is he a Police or EFCC chief? Didn’t he go after the bank debtors when it had to do with his own sector (Banking). This responsibility lies with The Petroleum Minister.. Thank You

  • http://www.facebook.com/people/Emeka-Ezinwa/571635744 Emeka Ezinwa

    No one cares about your father or grandfather, please do not use the issue of oil subsidy, for unnecessary personal inferences. If some insulted your family, go thrash it out with them privately, do not link it to an important issue that affects millions of Nigerians.

  • http://pulse.yahoo.com/_POHXI7ED2YWEYWGDVQ6MWXCH4Q williams

    I like removing subsidy, but the time was wrong. And Nigerians are not well carried along.

  • Anonymous

    This article has really enlightened someone like me about the story of this fuel subsidy and most importantly how it has come to be. It is understandable if even after this so many people will still not get it. I am sure at this stage people are too sentimental and angry to understand anything. But then why would people attack people’s family eg the CBN governor’s family did not do any harm to Nigeria, instead the said grandfather and father did so much good during their tenure. I think it is unbearable to mention someone’s father and grandfather like that. But anyway, like I said before people are angry with the nation and so dont know how to separate good from bad anymore understandably!
    WILLIAM point of correction, Sanusi studied Economics(B.SC) in ABU Zaria before he went on to acquire more knowledge in Islamic studies in Sudan. As a matter of fact he taught economics a bit in same ABU after graduation. This particular man has worked in Banking sector almost the whole of his life and has a wealth of knowledge in the area of economics. His profile is massive and can only be compared with whi I am yet to think of Nigeria. he is very deserving of the position he has.
    One thing that sets him apart is that he always come up with solution(whether favourable or not). he does not just sit down and criticise and do nothing. For example in this write up he brought out a good idea on how to alleviate the citizens from the burden of the removal of the fuel subsidy. His idea is one that will keep the removal of the subsidy and still help people out to cope with the situation. That same idea of his is foolproof if the government will listen and if the masses will calm down and understand it and strike to get it. In all, I still pray that God delivers nigeria someday IJN

    • Anonymous

      Sentiments apart my friend, mind you, that’s his plan by mentioning the insults to his forefathers, to draw sentiments from us. It is true that we have been enlightened and at this point, we can see some sense in the removal of fuel subsidy.

      However, it is only a cruel govt that will do such overnight without first putting in place, some palliative measures. To implement the 18k min wage, it took them months of debates, but to remove subsidy just like that. it reeks of insensitivity.

      Also, what happens to the money? They claim they are gonna invest in other sectors, well, the corruption they are running away from in the petroleum sector awaits them there, so why not just tackle the corruption once and for all???

      • http://pulse.yahoo.com/_KM65YJCSM5I7G56UYOZN22YKHQ tenkerowei

        Almost every Nigerian parastatal reeks of one form of corruption or the other. And in this article, those are the forefront of this crime were NOT voted in. They are our brothers and sisters in the CIVIL service. See you gave this govt four years to reform Nigeria – right, if you want to see such reforms, NOW less than a year into that govt is the best time to KICK OuT subsidy that fuels that corruption and lets see them use it to do what they said they will be used for so we can still come back and tackle them if they fail to do it. NOW is the tym to remove the food that breeds corruption. We would only suffer for a while ..

  • http://www.facebook.com/profile.php?id=800555564 Owolabi A Gbeminiyi

    Hallo Sanusi,
    Infact it took me days before i could be able to reply u on this issue,i had so many sleepness night and i couldnt concentrate on any other things, my colleagues at work notice and asked me to take days off work.
    1)U asked us to put ourself into a shoe of Nigerian Bussinness man who see an oppoturnity to steal Nigeria money but this bussiness man u had mention does not only steal money but corrupt the rest around him,by paying them some money to sign a document. ” instead of 5000MT for 200000MT”. i think u know how thigs goes here beter.
    2)U claim that economy is clear to u and u had been Chief Risk officer in UBA and FBN.
    3)U mention that instead of this bussiness man to be getting so much from the gorvernment u had prefer that the money should be paid to the workers as transportational fare.ammount u claimed to be : “N300B/P/A.
    4)U gave an example of the Iran that remove the subsidy and paying directly to masses.and that u had like that to happen here as well.
    5)U mention that the policy are badly defined, we import more goods u had mentioned.
    At last u sought out no solution to this problems than to started your “WAR AGAINST SUBSIDIES”.

    In the first place the gorvernment had actually provided a platform where a bussiness man could be stealen, by not making a single security form to be filled out by this bussiness man and that form could only be provided at the time to be offload by a known executive gorvernment staff. and most importantly there a technology out here to follow up the details on how things goes down in details to every single station, at this point i think u are only wages ur war against masses who does not involved in ur corruption up there, my question here do we masses have to be punished for ur inefficiency to sought out a solution to that.
    And u had said things about Iran,this country produces crude oil likes us, they import fuel like us, but they have a law inplace to killed anyone who steal the gorvernment money,why dont u start a war to put in place a law to kill anyone who had stolen nigeria money, if alive if not his or her family should be killed. u see another solution that does not suffered the masses like me.
    Moreso u mention that this subsidies money should be paid to workers, i really dont know which workers u had mean by that, Gorvernment workers or Private workers, then u had rather think of the private workers who will not have a share of it.Nigeria graduate are not able to get job that will even paid them minimum wages by the private company,do u know that 10000naira is the payment of nigeria B.sc holder like u, how do u want them to get to work if u dont stop ur war against subsidy NOW.
    In ur own words, nigeria import more goods than they export, then there will be inflation, because removing subsidies does not stop people demand for what their country is not producing and they need, so the goods price will not only go up but makes nigerians poorer than they are now, no average men will be able to have generated power and then we will be in dakness of the news and u fellas will be stealing money.
    U claimed u had hold some important position, u had claimed the economy is clear to u, i doubt and i know u arent fool not to know why and i think u are in that position because of the “policy badly defined ” ur words hmm. ur war against subsidy will only bring this nation to his knee, please Mallam SANUSI TURN UR WAR TO UR COLLEAGUES UP THERE IN THE CORRUPTION LANE NOT TO MASSES.

  • Anonymous

    Dear Mr Governor, this is a lovely anlysis of your fight againt fuel subsidy which is not new to many of us. We understand that people have been taking advantage of the subsidy process for personal but has the government played its own responsibilities of protecting the process, discovering the undelivered products, falsification of duocuments, arresting of corrupt government official, etc? The government cannot fail and expect innocent nigerians to pay for it. You mentioned one of the culprits (Zenon and AP owner), it means identified enemy of this country, what did the government do? Are the culprits above the law? So we now need to face the pains caused by a few that the government is afraid of. This is no policy, it has nothing to do wit greece and other countries you mentioned that had economy revolution. My submission is that the government should deal with the people corrupting the process and design a way of bringing i subsidy not that the people you mentioned will be free men and you will be removing subsidy. Chicken hearted government!!!

    • http://pulse.yahoo.com/_KM65YJCSM5I7G56UYOZN22YKHQ tenkerowei

      You heard him now, these guys are so clever to cover their tracks that you can hardly spot them. The whole system that had been put in place to checkmate the loopholes have been bought over so you would never have evidence. I understand what he’s saying and I think we all do except that we just want to eat our cake and have it which isnt possible. One of the best way to tackle corruption is to remove the opportunities that breeds it and this is it. If you have better alternatives, let us hear rather than abusing people.

  • http://www.facebook.com/oladeji.blessing Oladeji Blessing

    Hi Lamido, your submission is quit logical and emotional and i share your feelings on the state of the nation. But the people of Nigeria of which i belong will never want to accept any your solution i.e. “removal of the subsidy” as long as the root cause of these problems are not addressed. As an telecom engineer whenever a problem is detected or the network is down, we undertake the root cause analysis to forestall a re-occurrence of such issue. My questions are 1.) what if your assumptions about corruption in the petroleum sector are not correct(which i doubt) should the subsidy remain? 2.) What if we eradicate/remove the root cause (corruption) problem in the sector, should subsidy remain or it should be removed?
    Again the govt incurred the wrath of the people the way it went about the removal of the fuel subsidy. Note that in the example of US -Obama tax increase, it has to go thru a legislative approval. The subsidy was withdrawn without following the due process of public enlightenment. The masses the govt is trying to help were not wellcarried along.

    I wish to say that the ROOT CAUSE of this problem must be addressed to guarantee that re-investment of the “subsidy money” wont go down the drains. I bet you they will in the Nigeria of today. Corruption is our problem. Corruption and insincerity of the powers that be in fight against Corruption. If Femi Otedola donates 100Million naira to the Goodluck/Sambo campaign, i do not think that GEJ govt will prosecute AP/Zenon’s MD if found wanting. Hence, the people too will not accept the removal of subsidy since Ebele is not sincere to fight corruption. If the subsidy is transfereed to the Transport sector, it will surprise you that AP/Zenon and the other Femi Otedola to diversify to the transportation industry and take advantage of the opportunity offered therein. This is because business in about taking advantage of opportunitues.

  • Anonymous

    Fantastic analysis and revelations Sanusi. Kudos to you!
    I can deduce from your arguments that the real problem is not paying subsidies; the problem is that Nigerian businessmen bribe their way through the PPPRA control system. Realistically, businessmen will always thrive on loopholes within any system…and this is not peculiar to Nigeria alone. if the real problem is corruption within the system, then removal of fuel subsidy NOW is not the solution. The solution is to sanitise the control system or set up a new one altogether. I am not against the removal of subsidy, but the platform for its effective redirection is not well laid. Removing subsidy is simply relocating corruption. And what works in Iran won’t work here…Why? Something is wrong with the whole system and structure. So, the system must be worked upon first, solid foundation laid by repairing our refineries, and OTHER government excesses in terms of politicians’ salaries and allowances considerably cut down. If all this are done, there may not be any need to talk about subsidy at all.

  • Anonymous

    Dear Gov.
    It is great to have intellectual to explain complex situation in their area of authority even when they have more relevant information through their engagement with/in government on government policy. they should be able to answer logical questions that arise from such analysis. Harbert Spenser say ” A problem cannot be solve at the level we were when it was created” From your analysis, the subsidy is not bad as it were and it would have been fine by you if not for the corrupted system including the government official and the unknown marketer like Zenon/Ap and the cabal you cant mentioned. Your solution by implication is to keep the corruption a tNNPC/PPPRA, move subsidy to another corrupted system which you yourself have no clue to them and make the masses suffer all and be more poor. The Questions to answer: are you saying govt cannot sanitized is agency NNPC/PPPRA? Could govt not be able to monitor the activities of marketer who collect PPPRA? is govt not be able looking into the activities of its employee? will the govt be able to monitor the new system the subsidy is go if they have failed to make correction to the level of corruption you have been alerting 2 year ago at NNP/PPRA? However sir, you have not explain what happen to some economic variables (when you know it take less than 48hr for aggr price level to increase as the subsidy removal) and period the safe net take effect, if it will. [inflation, savings, investment, unemployment, interest rate, consumption, forex,GDP etc]. Cant you look at 1. a subsidy at pump ie govt pay subsidy to marketers based on sales at pump. 2 develop a fuel subsidy refund system for register individual who can support their claim with evidence for a monthly claim not later than 3 weeks 3 claim. scrabs PPPRA and develop your controllable system. Build a refinery with excess crude fund and issue of subsidy is going.
    It is obvious that there is problem with fuel subsidy but removing it now is not be best option but protecting it will be the way forward if it cost the government to go after the cabal (am sure you know them- from the list where you just mention one name).

  • Jon Omotunde

    Well written but this should not justify the punishment meted to hapless Nigerians. The efforts by the brave warriors on Nigerian streets and overseas should lead to some conclusions soon.

  • Anonymous

    @3rdeyes. I took the time to read almost everyones (disqus) after reading the Sanusi’s emotional and well outlined arguments for against subsidy not corruption. Like every one the real issue is Corruption in every phase of Governance and the private sector but I strongly lean my support towards your suggested solution to devising a systems that will put certification the claims of subsidy in the hands of the end users of the products in other words at the pumps.
    If Sanusi so loath the depth of corruption and if he is sincerely not just waging for personal credibility but to see a NIGERIA that his fathers and the rest of the fore fathers of Nigerians desired he should be ready to spill the beans with the mass of information and documents he has access to to begin the war Nigerians will support graciously and not mete further hardship to us in an insensitive manner by sudden removal of subsidy.
    Removal of subsidy on one hand and investing it in other sector developmental sectors without tackling corruption is just a relocation for more corrupt opportunities.
    If the subsidy stays and every a litre of product I as a Nigerian consumes from the pump not from one fuel dump or through papers for importation will count for the claim of subsidy by that marketer, I think it will go far to determine the exact subsidy. Though this in itself can never be a fool proof system but it will help deal with some issues. And this is in addition to other measures that may be in place to revamp the refineries, develop the power sector and infrastructures.
    Corrupt practices in government and private sector and identified personalities should be dealt with it with every fiat of governance and leadership instead of throwing emotional campaign and parties.

  • Anonymous

    TO MALLAM Sanusi Lamido Sanusi
    u show so much concern abt erradicating fraud through subsidy removal but u ‘ve forgotten dat problems are genuinely solve from the root and a house without a good foundation will surely collapse. In essence, i wish to remind u dat nigerians build and manufacture corruption everyday e.g have u asked GEJ how much it cost him to import 1600 buses and why is he putting subsidy into it if he is not opening way for some pple to defraud innocent nigerians. Mallam sanusi Let us call a spade a spade by advising GEJ to prosecute zenon, AP and other corrupt NNPC officials then build new refineries b4 subsidy removal.
    come to think of it, FGN said we are presently refining some crude oil locally. my basic arithmethic knowledge tells me that d cost of a litre of fuel refined locally cannot be upto the cost of importing refined products hence FGN filling stations shd be able to sell at a cheaper price than other petrol stations if not then i think mallam sanusi has not fully explored his intelligence to understand dat GEJ does not need to create hardship for nigerian.
    “Our source in the petroleum department revealed that funds earmarked for maintenance of the refineries were deliberately misappropriated by the big guns at the corporation to ensure the refineries fail. “The trick is to keep the refineries down by every means possible, so that they can make money from awarding contracts to import petrol” (Mohammed Barkindo, GMD NNPC)
    In summary, my advice to Sanusi are
    (1) make the refineries work by outsmarting these NNPC big guns if u are really intelligent.
    (2) use yr intelligence to assist GEJ prosecute this cabal dat have skyrocketed 240billion budgeted for fuel subsidy to 1.3 trillion. I am sure u are not interested in doing this because this is not d actual amount that was spent on subsidy in 2011 or how much was spent in 2010 on subsidy.
    (3) use yr intelligence to build refinery b4 removing subsidy
    (4) use yr intelligence to force GEJ to reduce his personal expenses in 2012 budget that is more than what Obama will spend in 69 years.
    after u might ‘ve succeeded in doing this then i will gladly embrace yr idea of subsidy removal because for now u don’t have a good idea for the masses.
    Again if u cannot do these then yr intelligence is equivalent to IBB’s intelligence that has ruined this country.

  • http://pulse.yahoo.com/_GY6GYPRVYLKZCQ7MBAUESXO52I Macfally Falola

    The way I see the argument is thus: Government removed subsidy because of corruption and pass it to the Nigerians to be paying. Yet this corrupt marketers will still be importing fuels and masses will continuing paying for the government inefficiency. The government should let our refineries work and put the palliative measure in place before removal of subsidy. Secondly, subsidy should be removed batch by batch instead of more than 100% at a time.

  • Anonymous

    Omar is not a man of his words if is true that he’s negotiating for #90 when the masses are saying is #65 or no negotiation. We shall continue our protest even without Omar.
    Oil prices jumped to 109.40 dollars per barrel (159 litres) on Tuesday, following threats by Iran that it could retaliate against new
    sanctions by closing the Strait of Hormuz, a key traffic route for oil
    from the Persian Gulf. So with this trend, if international oil price get to #200 per litre, Sanusi will expect nigerians to buy at that price when he closes his myopic eyes to GEJ spending close to 1billion on food.

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  • abu1911

    Dear Malam Sanusi:
    I have always been impressed with your analytical ability which is unfaulted but i must submit to you that timing for the removal of fuel subsidy is wrong in many ways. Subsidy is not yet a cancer in the body of the masses of nigeria and should wait most especially for many unanswered ques such as the following and many more: what is the benefit of being a citizen of an oil producing country if the you cannot benefit from the God given resources (which vividly implies general subsidy for petroleum products for nigerians)? why should the people be made to subsidise the inefficiencies of the almighty govt that is suppose to alleviate their sufferings, uplifting their living standards? why are the oil cabals so dreaded at even when they are not unknown? with the freedom of info bill signed by president jonathan now: how much did these oil cabals, the banks, various mins and their agencies cum other corporate bodies and individuals contributed to jonathan/sambo campaign fund and what are the promises made to them if any and whether or not such promises have been fulfilled or are pending and waiting patiently for the subsidy funds? why is the govt sudden urge to delve into executing a highly unpopular decision against the will of the majority of well-meaning nigerians (to remove of fuel subsidy by 100% and haste to work), is the imf/world bank pushing for that? if the govt loses about N100 billion a day as labor embarks on strike, that translates to N3tr in monthly losses which is even more than twice the amount the govt is fighting to cart away from the peo annually via oil subsidy funds removal, now the ques is whether the fund accruing to the govt is yet not good enough for her leaving the subsidy alone till a more appropriate time? the govt has been borrowing an average of $1bn a month in addition to various sources of revenue available to it, why squeeze the common man? the subsidy re-investment is supposed to be for the good of the people who are saying not now, please not now, why is the govt not listening when the electorate talks since the govt has no one she can call her parents but the very people who’s produced her? what are the numbers, how is the subsidy arithmetic (iam quite sure the subsidy figure of N1.3tr is highly inflated, impregnated with spurious figures typical of nigeria, from N300bn – N1,300bn in subsidy is unimaginable)? the govt have sworn to utilise the sub funds judiciously but she’s got an unimpressive track record and she is not going to import fresh peo in clean plastic containers to handle the fund, rather the same old hands will apply this fund and the peo are saying leave the subsidy in place for now and apply the surplus in your care….I earnestly believe the main problem facing the country is official corruption, if the govt can do away with it, there will be excess resources in her hands and the subsidy will automatically disappear cos we will no more import petrol, a number of refineries (private/public) would be operating at full capacity and so on….my sincere advice as a nigerian here is for the govt to put the necessary enabling medium that will cushion the withdrawal effects before bringing forth an argument for subsidy relocation from areas of higher corruption to those of lower ones so that hopefully, the benefit of subsidy may reach the common man……and any future withdrawal be done in phases and transparent with numbers and monthly targets. There should also be provision to halt the program if the govt (federal or state) derails from the original road map…..i think this will help and may probably need a legislation but i think that is the only way without which the govt should not go inflicting pains on the masses of this great country, taxing where income is none existent! Long live the FRN

  • http://twitter.com/VOAu ilobi austin

    Sir, please don’t waste valuable time on ignoramuses who insisted on hoisting their ignorance up like a flag for the entire world to see.

    fuel or petroleum product subsidy is and remains the biggest constraint to growth and development in the annals of Nigeria’s history.

    why would anybody with a modicum of sense support a system that takes away government capacity to develop the country and still cry out about lack of same. some keep talking about the past and how in spite of subsidy the country recorded some levels of development and i ask, what was the population of Nigeria and and what was the standard: one way lanes.
    no sane person can compare the infrastructural needs of today to that OF THE PAST AND IT REQUIRES FUNDING TO BRING about

Zenith

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