President Bola Tinubu declared yesterday that he would not accept an explanation for failure to the National Economic Council, NEC, which was chaired by Vice President Kashim Shettima.

The council, which oversees the economy, is composed of the vice president, 36 federation governors, the governor of the Central Bank of Nigeria, CBN, and other coopted government officials.

In response to the National Income, Salaries and Wages Commission’s suggestion to pay workers a consequential adjustment of N702.919 billion to lessen the impact of the elimination of fuel subsidies, the council announced that it will take Tinubu’s warning into consideration.

President Tinubu addressed the council before it entered a closed-door meeting and instructed it to develop actions to lessen the effects of the termination of fuel subsidies.

He tasked the group with helping his administration change the nation’s economic fortunes.

The challenge of expanding the country’s economy, according to Tinubu, is immense, and there should be “no excuse for failure.”

He reaffirmed the will of his administration to keep its commitments to Nigerians.

NEC considers payment of N703bn to workers as palliative for subsidy removal

The NEC also said that it would take into consideration the request for a second N25 billion monthly fuel allowance payment to workers to lessen the impact of the suspension of subsidy payments after its first meeting.

Bala Mohammed, the governor of Bauchi State, made this announcement to reporters from the State House after the inaugural NEC meeting, which was presided over by Vice President Kashim Shettima and held in the Council Chamber of the Presidential Villa in Abuja.

He said that the government had taken a comprehensive approach to all the challenges and issues surrounding the elimination of subsidies and had formed a small council committee to assess the situation and develop a mandate that would help to address the concerns of workers and other vulnerable groups.

He claims that the South East geographical zone is represented on the committee, which also includes the governors of Kebbi state and Anambra as chairman. North Central Benue, Northwest Kaduna, Northeast Bauchi, South South Cross River, and Southwest Oyo State.

It is anticipated that a suggestion will be submitted to NEC in two weeks for an early, comprehensive decision to address any issues that the elimination of subsidies may cause.

He said, ““The NEC had received recommendations on the various ways and means that the country can use whatever increases that we have in the revenue to mitigate the impact that this is going to make on the lives of our workers. ⁣
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“And so they recommended that there should be a consequential adjustment, estimated at N702.92bn as part of the allowances that should be given as petroleum allowance to all workers and as well as a N23 or N25bn monthly offer to cushion the effect on workers.” ⁣

Mohammed clarified, “I believe what I said, maybe I didn’t say it very clearly, is that various scenarios were given by the presenter on the subject of national salaries, income, and wages, and that this 702 billion plus was suggested as an allowance for the cost of living adjustment allowance by the organized Labour, and the other one is a petroleum allowance.

“The governor of Ogun has told you that there are other allowances here and there, but with regard to Labour, these are some of the few allowances that they have suggested and that of petroleum, they said will range from 23.5 billion to 45 billion per month, depending on what is in the kitty for distribution or for sharing.

“So the 702 billion is a suggested sum for Labour to cushion the effect on workers on a new allowance that will be tagged cost of living adjustment allowance.

“We will sit within two weeks to come up with a recommendation to NEC for a holistic decision that will be taken immediately to alleviate the problem that is being encountered by the removal of the subsidy,” the Bauchi Governor explained.

He said the input of the committee on palliatives earlier set up and headed by former Vice President Yemi Osinbajo would not be discarded but integrated into the ongoing process.⁣

Also speaking, the Abia State governor, Alex Otti said, “As part of the inaugural national economic council meeting today, major focus was on the removal of petroleum subsidy and implied removal of subsidy on foreign exchange, which has led to some convergence of some sort.

“The impact of these two actions definitely is increased prices. And as a way to solve the problem and reduce the shock, a presentation was made by the National Automotive Design and Development Council on the great things that are happening in the automotive industry.

“It was that about six states in the country, including Lagos, Ogun, Anambra, Enugu, Akwa Ibom, Kaduna and Kano that have benefited from domestic production of vehicles or assembling of vehicles by Nigerian companies operating in Nigeria. And these companies include INNOSON, Maikano, Dangote Peugeot, Peugeot automobile of Nigeria, Stallion Hundai, Honda, Elizade/Toyota, Coscharis and Ford, Kojo Motors, Jet Systems motors.

“At the moment, about 50,000 jobs have been created by this simple action of either assembling vehicles in Nigeria or producing them in Nigeria. A great feat is that some of these companies have gone into the manufacturing or assembly of electric vehicles and vehicles powered by CNG – compressed natural gas.

“The impact of this is that the pressure on the price of petroleum products particularly PMS will be reduced the more we use electric vehicles and CNG powered vehicles.

“Some of the decisions that were taken include that legislative support will be needed to be given to these companies that are doing great things in Nigeria, it is important to underscore the point that former President had made a commitment that by 2060 that Nigeria would join countries that will eliminate fossil fuel powered vehicles and move to electric vehicles in pursuit of the net zero emission that some of the countries in Europe, America and Asia have signed on to.

“So if that must happen, then we need to ramp up the production of electric vehicles and CNG vehicles.

“It is estimated that if we give legislative support to these companies, that about a million jobs from the 50,000 jobs that exist in that industry would be created. It was also suggested that the funding that is required by most of these vehicle manufacturers and assemblers shall be made available to them. So that we begin to reduce the dependence on PMS and other fossil fuel powered vehicles.

“Finally, it was also suggested that electric vehicle development plan, will fast track the development of electric vehicles and should be supported wholeheartedly by the new government. The reality is that we cannot run away from the removal of petroleum subsidy. We should have done it a long time ago.

“But we must salute the courage of the current government to bite the bullet and remove it. Initially, it had reduced the consumption from about 66, 67 million litres a day to just about 40 million. And as time goes on, the consumption will continue to go down.

“We know there are implications particularly for the poorest of the poor. And that is why this government is seriously looking at palliatives to at least deal with the shock that the poor of our society goes through “

The Ogun State governor, Dapo Abiodun, said, “What I’ll be speaking on is the contribution by some of the key oil and gas sector heads. We had inputs from NNPC, NMDPRA – Nigerian midstream downstream Petroleum regulatory authority.

“We had from the marketers and of course, it was a robust dialogue, cross fertilization of ideas by all the executive governors across the length and breadth of Nigeria today.”

On his part, the ⁣Katsina state governor, Dikko Radda said, “we just had our maiden meeting of the NEC Economic Council. And so many issues were discussed and resolutions were made on some issues. Some issues were sent to various committees for more deliberations. Part of the issues that we discussed today is palliative measures to mitigate the effect of the petroleum subsidy through the NG-Cares programme.

“As you are aware, the NG-Cares Programme is a programme that started 2021 running up to 2024. And then is to provide some emergency on palliatives, social needs on so many issues ranging from small farmers holders, MSMEs and other interventions.

“It’s a $750 million from the World Bank. And it has commenced long time ago. And some of the recommendations that were made include the state Cares platforms having strong capacity to handle the implementation of palliative to the new and existing poor and vulnerable individuals, household and farmers, local economy of operators in the country.

“Additional funding can be sourced from the federal government, World Bank, Development partners as well as Nigerian private sector. In specific, the World Bank can be approached for additional financing on NG-Cares programme. Discussion can start as soon as possible.

“So these are the recommendations that were made. And the Economic Council will pursue these recommendations for the benefit of the Nigerian, vulnerable and the poor.”

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