Senators were, yesterday, divided over plans by President Goodluck Jonathan to remove subsidies from petroleum products in January 2012.
Senate President, David Mark who presided over the session decried the high cost of running the executive arm of government even as the senators faulted the revenue projection of government in the MTFF.
While some of the senators believed fuel subsidy removal will trigger development and national growth, others contended that subsidy removal will compound the economic woes of the masses.
Some of them urged government to be cautious in its approach to removal of subsidy, while others held the view that government cannot continue to fund subsidies in the oil sector that does not have direct benefit on the masses.
But the senators were, however, unanimous in commending the Federal Government for its foresight in developing a long term fiscal development strategy for the nation.
Senator Emmanuel Paulker, PDP, Bayelsa Central, lauded government plans to deregulate the downstream oil sector.
He said: “Deregulation is a very good policy as far as I am concerned. If one quarter of budgetary provision is going to one sector and we are not seeing the benefits, then it is not good enough. It is my view that government cannot continue to spend resources for Nigerians to get fuel at N65 per liter to the detriment of the poor.”
Senator Hope Uzodinma, PDP Imo West, who was in support of fuel subsidy removal called for prudent management of the resources upon the eventual removal of oil subsidy.
According to him: “The planned removal of fuel subsidy in 2012 is part of the fiscal strategy. The plan envisages that this will free up about N1.2 trillion in savings in 2012 alone. Emphasis should be placed on core areas of national needs especially on security and agriculture.”
But speaking against removal of fuel subsidy, Senators Dahiru Awaisu Kuta, PDP, Niger East and Babayo Gamawa, PDP, Bauchi North both said government has lost sense of direction in the management of the nation’s economy.
Kuta in his argument against subsidy removal said: “Unfortunately for us, we do not know where we are and it is difficult for us to know where we are going. We pumped a lot of money into the power sector without any result. Everything is geared towards removal of subsidy. I appeal to government to please look at this approach again. If they have to remove subsidy, let it be gradual. It will be too negative, too sudden and our masses will suffer.”
We need to be cautious — Gamawa
Gamawa in his contribution said: “One of the major components of the policy of physical consolidation is government’s intent to phase out subsidy beginning from 2012. And this subsidy removal, Nigerians are still very unclear on how it is going to impact on their lives so we need to be very cautious.
“My colleagues will agree with me that right now we have problems all over in every sector, health, education roads, security things are not right. We have these problems especially this issue of subsidy; enlighten our electorate on how subsidy removal will impact on their lives. I am not in support of subsidy removal anyway until we are satisfied on how it will impact on the lives of Nigerians.”
Senator Sani Stores, CPC, Katsina kicking against subsidy removal said: “I am surprised that people are saying this is a good document. When you are planning, you need to plan 10, 15, 20 100 years ahead, this is just two years or three years from 2012-2015. That is a short term fiscal policy. If we recall, the price of oil used to be nine dollars per barrel; as of today, it is over 100 dollars per barrel.
“The budget is set between $70 per barrel to $75; there is an excess of over 25 per cent per barrel. We produce over 2.5 million barrels a day. Where is that excess money? Before our late president died there was over $20 billion in our foreign reserve, where has that $20 billion gone to? It would have been used to cushion everything we need without the removal of fuel subsidy. In my opinion, failing to plan is planning to fail; we have four refineries none of them is working.”
Senator Mark while ruling on the debate dismissed misgivings about the MTFF, noting that it is just mere government intentions for the four year period.
Senator Mark also said the MTFF is a good replacement for the yearly budgetary process which has failed in terms of development and transforming the economy.
His words: “I will like to sum up by saying that I think the paper is just a framework at this stage and for all intents and purposes the figures are preliminary figures; they are not fixed. There is no doubt that a paper of this nature will not capture everything, there will be omissions and by going to the committees, the essence is for the committee to take a better look at the details of the paper that has been submitted to us.
“It is based on the four year rolling plan or budgetary plan. I think we are agreed that this yearly budgeting system has not worked, if we have a rolling plan it is easier for us to see at a glance what we are looking at for the next four years.
“However, even as a person, I am a bit worried that the capital increase is just per N170billion from 2011 to 2012. How will a mere increase of N170 billion really be a projection. So, when the paper gets to the joint committees, I think these are the areas they may want to look at.
FG should trim workforce — Mark
“The Federal bureaucracy obviously is over bloated, how has it been captured? What have we done in this paper to ensure that this over bloated Federal bureaucracy is not continued? In fact, we should make every effort to reduce the federal bureaucracy.
At the moment we simply cannot sustain it. It is not only over bloated it has got a very high consumption rate and national consumption rate too. These are some of the areas that when we refer them to the committee, the committee will have to look at properly.”
Meanwhile the Senate also referred the ambassadorial screening to the committee on foreign affairs.
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