Come Clean On Fuel Subsidy, Tax Regime, Others, Atiku, PDP Tell Tinubu

Former vice president Atiku Abubakar has reflected on the one year anniversary of President Bola Tinubu in office and declared that Nigeria is not working.

The former vice president reflected on the one year anniversary of President Bola Tinubu in office and declared that Nigeria is not working, adding that it has been a year of a cocktail of trial-and-error economic policies by the Tinubu-led administration.

Similarly, the Peoples Democratic Party (PDP), said  having thoroughly reviewed the state of affairs of the nation in the last one year, Nigeria is experiencing its most challenging period in since the Civil War.

The national publicity secretary of PDP, in a statement, Hon Debo Ologungaba, said

the current rising insecurity, excruciating poverty, economic hardship and general despondency in the country necessitating the fleeing of thousands of Nigerians especially the youths from our nation further confirm that there is no hope in sight with the APC on the saddle.

Atiku, presidential candidate of PDP in the last election, who stated this against the backdrop of May 29 inauguration of Tinubu as president, cautioned that time is running out on the president.

He therefore advised the president to provide clarity on fuel subsidy, tackle insecurity and review the 2024 budget.

He further asked the president to undertake a comprehensive review of the Social Investment Programme (SIP) and stop further pauperising the poor by introducing new taxes or increasing tax rates.

Atiku, in a statement, recalled that  Tinubu raised the hopes of Nigerians on May 29, 2023 with his pledge to “remodel our economy to bring about growth and development through job creation, food security and an end of extreme poverty.”

He also recalled that Tinubu spoke about growing the economy at double-digit rates to US$1 trillion in six years, a statement which, according to Atiku, made “Nigerians breathe a sigh of relief after their experience with ex-President Buhari’s 8 years of economic misadventure.”

He however said Tinubu laid out no plans for the ‘remodeling’ of the economy but soon embarked on a cocktail of policies to achieve it.

Proffering ideas to the president on the state of the country, Atiku asked Tinubu to “first, pause and reflect,” stressing that the government must understand what reforms must be undertaken and in what sequence.

Adding that a framework is needed with clearly stated reform objectives and strategies, Atiku said the president needs to undertake a comprehensive review of the 2024 budget within the new reform framework.

“The 2024 FGN Budget, the exact size of which remains a mystery, is not designed to address the structural defects of the Nigerian economy or the cost-of-living crisis. It will neither create prosperity nor promote opportunities for our young people to lead a productive life.

“The review must prioritise fiscal measures to deal with an unprecedented rise in commodity prices.

Higher commodity prices have created more misery for the poor in our towns and villages and have pushed millions of people below the poverty line. One of such measures for immediate implementation will be to ease the existing restrictions on selected food imports.”

The former vice president added that the president should undertake a comprehensive review of the Social Investment Programme (SIP) to mitigate some of the impact of these policies on the most vulnerable households.

“The SIP must go beyond Conditional Cash Transfers to include programmes that prioritize support to MSEs across all the economic sectors, as they offer the greatest opportunities for achieving inclusive growth. In addition, a holistic programme to support medium and large-scale enterprises to navigate the stormy seas in the aftermath of the withdrawal of subsidy on PMS is also needed.”

He further cautioned Tinubu against any attempt to further pauperize the poor by introducing new taxes or increasing tax rates.

“We are aware of the behind-the-scenes attempts to increase VAT rate from 7.5% to 10%, re-introduce excise on telecommunication, and increase excise rates on a range of goods. It needs to be restated that we cannot tax our way out of this situation. Instead, Tinubu must see the need for expenditure rationalization and restraint – by having the budget more in sync with Nigeria’s fiscal reality, by improving efficiency in revenue utilization, improving procurement processes and trimming the size of government – and therefore reducing the cost of governance.

“Fifth, provide clarity on the fuel subsidy regime, including the fiscal commitments and benefits from the fuel subsidy reform and the impact of this on the Federation Accounts. It is curious that since April 2024, fuel queues had mounted at many filling stations across Nigeria, and the infamous ‘black market’ has sprouted in several states. How much PMS is being imported and distributed, and at what cost? What is the implicit subsidy?

“Sixth, tackle security headlong. President Tinubu, as a matter of priority, needs to rejig the nation’s security architecture as what is currently in place is not serving the needs of the people. The state of pervasive insecurity continues to adversely impact agricultural production and the value it brings to the economy, especially in the Northern parts of the country. Insecurity resulting from terrorism, banditry, kidnapping, and cattle rustling has compelled many crop farmers and pastoralists to abandon their lands and relocate to the neighbouring countries of Niger, Chad, and Cameroun.

“This has drastically caused a reduction in the production of food and skyrocketed prices of foodstuffs. Food scarcity in Nigeria is so dire that a report by Cadre Harmonize warns that between June and August this year, about 31.5 million Nigerians may face severe food shortages and scarcity,” he said.

Atiku, who said he has always been a reform advocate, noted that the Nigerian economy certainly requires a large dose of reform measures to accelerate its transformation after many years of lacklustre growth.

He however said he understands the appropriate reforms to undertake and what steps to take per time to mitigate their negative impact unlike the president.

“In my Policy Document, I had anticipated that the withdrawal of subsidy and unification of exchange rates could, in the absence of fundamental interventions, impact negatively on micro and small enterprises in the informal sector and on the medium to large enterprises in the formal sector.

“I had also anticipated that such policies could elevate the levels of vulnerability and deprivation of poor families, including the youth and adults with no incomes. With this understanding, I had designed robust mitigation interventions that will be implemented alongside our reforms.

“I was prepared for reform fallouts. Tinubu wasn’t. However, it is not too late for him to change course and do what is right for the good of our people and our nation,” he said.