Why we want total removal of subsidy – Odaah



Timothy Odaah is a laywer, an economist of repute and Ebonyi State Commissioner for Finance. His knowledge of the economy and contributions to the economy set him out among his peers.

That he emerged the Chairman of Commissioners Forum is a case of who the cap fits and not necessarily a political calculation. His tenure as Chairman of the Forum has witnessed some exciting and vibrant moments in the history of the Commissioners Forum and Federation Accounts Allocation Committee (FAAC).

Several times he has taken his colleagues on a protest match over statutory revenue allocation to states. His vocal disposition and defence of his colleagues has earned him the respect and love of fellow commissioners.

He spoke to Daily Sun on a number of issues bordering on the Nigerian economy and the way forward. Excerpts:

Diversification as alternative to oil

Our purse should determine our expenditure in view of the fact that the world wide economic recession also has implication for Nigerian economy. It is not peculiar to any country. Then, I emphasise on the need to reorder our development on the basis of priority. Immediate consumption is good but at the same time we should make savings for tomorrow. Infrastuctural faclities in terms of collateral economic infrastructural facility that will yield income in future for the purpose of sustaining what has already been developed and contrbute in the development of other sectors is important. In that way, if we curtail our investment in white elephant projects and concentrate on putting our national investment, government investment and policy thrust that will encourage individual businessmen to be involved in economic projects, income-yielding projects, it will help a lot.

For example, we never heard the name of China the way we are hearing it today. Just a week ago, not up to seven days, India launched its first aircraft carrier. They are into manufacturing of aircraft and also ships. They have gone nuclear. All these things came as a result of the propensity over a period of time that placed investment and savings over and above consumption. Today, it is even feeding other countries. China is feeding other countries not only on foods but on material needs. The challenge they are giving America today, the difference between their economic development in the world rating is only but a thin line. For example, we talk of America now going to produce the largest oil output but you discover America has the largest stock of oil in the world. China in itself is busy investing in various oil fields in the world. In West Africa, they have taken the largest chunk of it. Then, you go to Canada, you know that Canada is also a large oil-producing country. China has bought the main oil refinery in Canada. With the combination of Chinese investment in petrol and refineries in the whole world you now discover that they may be at par with USA irrespective of the fact that in USA they ship out. But in China, they ship out from their various places of their investment and they have greater returns. You will see that the economic trade will be much more on their own side because in the case of USA being a giant of the world economy, other countries may not have so much to give out. But where China itself is having investment in oil in various countries, the employment in the American oil industry will, to a great extent, favour their own citizens because 90 per cent or if possible, 99 per cent of the American citizens will be involved in that oil production.

But Chinese investment in various other countries in oil production will include the citizens of these other countries in employment apart from the hyper-technologies. There is more integration. If time goes on it will be like the French method of administration by assimilation.

Chinese employ you in your own place and you are producing. The reason I am saying this is because of the emphasis that we are now going Chinese because America is already trying to withdraw its consumption of oil and then we are running to China.

China is equally getting involved almost on the same level eventhough it has scattered investments in oil. China is in Sudan, Uganda, Mali, Canada and I am sure it is going to India. Whether China as a country will, because of its economic relationship with Nigeria, be importing oil from Nigeria, I do not know. So, we still have a long way to go. Secondly, what are we doing with the oil? All this hues and cry, does it mean that we should drink the oil, put fire on it to burn and we collect the smoke, store the gas? I think what is needed is an alarm. We use this period and what we have to create a sort of recycled development. We use technologies that will include income, revenue-yielding to involve ourselves in diversified economy.

How can we do it? Our workforce is so much because of our comparative lower technological development. We still have a lot of capital flight. If we don’t buy their goods, we do buy their services at a very great cost. That is why we need to emphasise our policy thrust to encourage professional education. Nowadays, you have too many degree holders in political science, in philosophy, in religious studies, sociology and so on and so forth. They are good but they are all time relatively undefined certificates. We need to develop the baserock. Early this year, President of United States of America (USA), Mr Barrack Obama, irrespective of their level of development technologically, still emphasised the need to involve much more investment in the training of more technologists, scientists and mathematicians in USA because empires rise and empires fall. They have present classes of scientists and technologists. Some of them are going out of the service. Age wears down knowledge and there is the need to, according to him, grow in feeder fields. No investment in that. We learnt that Japan learnt from their worst. Their worst idea gave them their best knowledge because with the Hiroshima War that devastated their country, they started studying so much about technology. Just a few years ago, they were second to the United States of America as industrial giants. They learnt a lot.

What have we learnt in our own?

We should use this period of threatened poverty; this period of threatened embargo and this threatened divestment from our oil as far as USA and other countries are concerned, to use what we have to get what we don’t have. Collateral infrastructural economic facilities is the emphasis. We have said so much about power. To what extent has our power stabilised?

And if by the period America divests its interest from our oil and we have not achieved up to 90 per cent in our power requirement the tendency is that it will throw in a very bad spanner in our industrial development.

The roads of course, I know that the present federal government has a record of the largest road development, road network development but there is still more. We need to widen the road network to enter into the rural areas and that is where the states will have to come in. Thank God we have this subsidy fund. The subsidy fund is well utilised by the various states, local governments and federal government. It will help in the development of such collateral economic infrastructural facilities. The emphasis should be on water, road, power and of course, it is when human beings are alive that they would be able to make use or be involved in those developments, which means, health is also important. Then, we should encourage education in the various organs of the government from rural areas too. Let it be qualitative education. We tend to have inferior quantity instead of qualitative minority in terms of education. Let’s train industrialists in terms of our scientists, our technologists and emphasise on that.

Why total removal of subsidy

In terms of the oil subsidy, I am one of those that support that there should be total removal of the subsidy or about 95 per cent removal with condition. In removing it, the government must ensure that it embarks on a commensurate development that will reduce cost on the people in accessing the means of livelihood.

If it is removed where is it going to?

If there is further removal on the subsidy, is the government going to invest so much in power in order to improve power supply to the extent that it will be up to 99 per cent? In that way it will be used in the villages, the rural areas whereby it will encourage cottage industry development, lead to self employment, grow small scale industries into medium scale where one person will be employing two, two or three three persons. But today, there is a collapse. As you heard me say, if Nigeria is going to be developed to the extent that you have 99.9 per cent power supply and there is water and there is good road network with health already on ground I advocate a total removal of oil subsidy. The type of education we are having today, where you have too many degree holders in philosophy, in religious studies and so on and so forth, to what extent will it help in the improvement of the economy except in growing more churches. Of course, that is good. They will be praying for our souls. But where you are not a reverend father or a priest living in the church or cathedral and you stay there to pray overtime, nothing to produce, you may die and go to heaven because you died as a faithful person. But for the one who is not a priest but engages in productive economic activities and goes to worship in the church at the required period, you will discover that he will have more money to build more churches and also support the church, train the souls and the economy is moving. God will like him for his generosity. The church rat doesn’t really mean poverty. The poverty that the Bible talks about is humility and you see also that the one who doesn’t go to church and concentrates on economic activities, may eventually succeed in the world. But if he dies, he will go to hell but there should be a balance. So, what we are saying is this, if all these developments come out, if Nigeria invests so much that it removes from oil subsidy in infrastructural development, what use will it be to the larger population that has not acquired professional education, vocational education? I think you understand. I think a politician is a person who read political science, philosophy and so on and so forth. We have lesser number of institutions that you go to teach all those things. We need to inculcate in the people the need for self reliance on a very serious note and when I talk about professional education, it doesn’t mean you must attend universities. I still learnt that less than 25 per cent of the American population are graduates from universities. They emphasise on what they can produce. We have a case of disguised unemployment in the country. And disguised unemployment is where there are actually areas that are yearning for employment but the people who are looking for the job or who ought to do the job are not qualified for it. Yes, you are a graduate but you are not a graduate of the primary needs of Nigeria. I want you to refer to the case of 1982 and 1983, when we had Ghana Must Go, a lot of work existed in Nigeria, but people were looking elsewhere. Ghanaians came and started from the rudiments. Before you knew it, most of them had become this and that. Most of them were going overseas from here. Most of them were going back and what is happening, look at what Ghana is today? I don’t know whether you can compare it. They learnt from hardship. We learnt they were hewers of wood and carriers of water.

What have we learnt from our hardship?

National protest is not the issue; we should protest within ourselves, ask ourselves questions. It is not the matter of coming to gather in a square and shouting “don’t remove oil subsidy” and government of course, should come up with the will power. They fear that in fact the nation will burn and that is why we don’t want to do this. It cannot help because that is developing unnecessary phobia rather there should be sensitization. There should be commitment. There should be sincerity on the part of the government. The government should ensure that this subsidy is applied for the purpose of the welfare of the whole Nigerians by ensuring that there is investment and I want to cap it up with the proverbial saying in literature that “ you have to be cruel in order to be kind”. When your child insists that all the amount of food should be taken at the same time in the house, of course you know, if you adhere to her or him, she or he will eat and develop constipation and there may not be anyone for tomorrow. Rather, cut it and give her small. He or she will cry out blood but there will still be food tomorrow. That is what Nigeria needs as at now but you don’t blame the people. Enough sensitization has not been carried out. Even the churches should preach it. There is no need to pretend.

Plea bargain

I am against plea bargaining. Crime is crime, and I think we should follow the law of the federation and that is where the National Assembly comes in. Like I said, plea bargaining itself should be discouraged to a great extent. That is where the various state legislatures will come in– the judiciary, the government itself. Plea bargaining for me looks like negotiating a crime. Crime is crime. In the village, if a pick-pocket takes your one naira and is given a beating that he will never forget, somebody who has stolen billions will go on plea bargaining. For what! Government does not have to negotiate with such a person because plea bargaining is a negotiation. If you steal one billion naira and you give 700 million naira, the 300 million naira remaining is it your own? Why should you keep it back? Then somebody who stole a goat should equally be asked to first divide it into three. While he takes the other part the owner takes the other. NO! It shouldn’t be so.

Huge expenditure

If the local government encourages collateral infrastructural development, it will create jobs, it will create cottage industries, it will create satellite industries, it will create industries in the rural areas, in the satellite towns and in the urban areas. You don’t even need to be sacked before you live on their own. If you get involved in productive economic venture, you will discover that you will even be eager because after all, under a productive economy, you discover that whatever it is you are paid where you are working is only but a fraction of the total amount that you produce. Whatever you receive as your income, no company, no government can give you 100 per cent of what you produce in that entity. Your salary is only but a fraction of the total output that you bring about. Many people who are conscious of that, if they have the means and the facility is available, they will go on their own. So it is not the matter of coming in a fell swoop, it is to be programmed.


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1 Comment

  1. I’m sure Mr Timothy Odaah means well but that is not enough in the current Nigerian Project. The ordinary Nigerian would gladly sacrifice if assured of bountiful positive dividends at the end of all the pains incured but you and I know that the common man has been taken for granted for far too long in this country. Let’s make it shot by taking it from Babangida’s SAP through Shagari’s Green Revolution, Obasanjo’s Operation Feed the Nation and the current phoney Transformation regime. In all this time, right from OBJ’s first outing as a military head of state through Abacha, OBJ’s 2nd coming (“civilian” President) to the present Jonathan’s administration, there has been unending removal of oil subsidy. What has the successive governments done with our toil and sacrfices other than increased suffering and pains for the masses and increased superlative joy for themselves in goverment and their cronies outside? With the huge income from crude oil sales over the years, have they been able to build one functional refinery? With the huge allocation to the power sector, works and housing, health, education,etc, year in and out, what developmental climate do we have to show the world? It is corruption all the way. What has become of the various oil subsidy fact finding panels since 2011? Are we still hearing anything of the Faruk Lawan/Otedola gate? Truth is that many experts say there’s truly no subsidy and many of us believe same. I’m sure, Mr odaar, as a lawyer and economist knows that so much savings will be made if proper costing and efficient methods are employed in the production of our crude oil. Many of us including the various governments are aware of the bunkering going on in the Niger Delta. We even pretend not to know the number of barrels produced daily. Shame! Truth is that our country is not short of good policies, its the will to impliment them(policies) that is lacking. Our so called leaders are so enmeshed in corruption that they are blind to good governance. I honestly think Timothy should be thinking of ways to educate his collegues in government and their friends/fronts in the corridors of power to have a new positive orientation and attitude to governance; on how to be selfless rather than selfish. Yeah, that’s the way to go, certainly not more of the so called subsidy removal. Something inside tells me Mr Odaar is fronting for President Jonathan to test the waters again. It is not wise!

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