Democratic Socialist Movement

For Struggle, Solidarity and Socialism in Nigeria

By - DSM

DSM Press Statement

DSM Press Statement


We call for Nationalization of NITEL under workers’ democratic control and management.

Segun Sango, General Secretary, Democratic Socialist Movement

The revocation of the sale of the Nigeria Telecommunications Limited (NITEL) to the Transnational Corporation of Nigeria (Transcorp) by the Yar’Adua government underscores the failure of neo-liberal policy of privatisation of public utilities. But, for sure the government has not learnt that lesson with its resolve to resell the telecommunication outfit to another set of the so-called private investors.

The Democratic Socialist Movement (DSM) calls for nationalisation of NITEL under the democratic control and management of workers and professionals in order to ensure quality service delivery and make corrupt practices extremely difficult.

It will be recalled that this is not the first time the sale of NITEL has been revoked from private investor. Before its fraudulent acquisition by Transcorp, the company had been sold to a group of wheeler-dealers called Pentascope which left NITEL much worse than it met it.

More than any other instance, the ill fate that has befallen NITEL under different private vampires, has clearly shown that privatisation, as a result of the profit first interest of the so-called private investors, cannot jumpstart the nation’s ailing economy. The fact is even that privatisation often worsens the already bad situation with characteristic loss of jobs, inhuman working conditions, outrageous charges, etc, while it helps transfer the collective wealth of the country to the private fiefdom of the thieving ruling class.

Right from outset, we of the DSM have repeatedly kicked against privatisation as an anti-poor policy which sacrifices the living standard of the mass of working people for the profit interest of a few capitalist money bags. No matter the good intentions of government, the profit-driven motive of capitalist economy means that no meaningful economic development can be expected from private sector investment in such public utilities like NITEL.

Usually, the argument of pro-capitalist elements against public utilities has always been the mismanagement and corruption rampant in the state-owned corporations. We also detest this, in order to make a bold statement that corruption cannot be tolerated, we have always campaigned that all looters be brought to book. But as a strategy to reduce corruption to the barest minimum, we have in addition always canvassed for workers’ democratic control However, the scale of corruption, daylight stealing and asset stripping carried out by Transcorp within 30 months of its ownership of NITEL shows that private sector is not the way out either. The Group Managing Director of Transcorp, Tom Iseghohi and two directors are currently on trial over serious charges of corruption.

It should be recalled that acquisition of NITEL by the Transcorp, which has former president Olusegun Obasanjo as one of the major shareholders, in the first place was fraudulent and driven by sheer cronyism. NITEL and its GSM mobile subsidiary, M-Tel, were sold in 2006 cheaply to Transcorp at a give-away price of $750 million for 75% equity. A group, International London Limited (ILL), which was the preferred bidder, had in 2001 offered $1.3bn for 51% for equity in just NITEL without M-Tel, but the deal was cancelled on the account of delayed payment. But Transcorp did not only fail to make the deadline for its own payment, but also could only pay $500 million when it eventually did. Yet, it was allowed to acquire the corporation in November 2006. Within 100 days of acquisition it was obvious that Transcorp lacked both the technical and financial capacities to turn around the telecommunication company which is the national carrier. Yet, this rotten deal was allowed to last for almost 3 years.

The fate of NITEL workers and the entire company under the inept and corrupt Transcorp management has shown how corrupt and incapable of driving genuine economic development the Nigerian capitalist ruling class are. Justifying the revocation the government said Transcorp had failed to meet its obligations to invest N8.9 billion within 100 days of the takeover and had racked up debts of N17 billion. Not only did TRANSCORP break all the deals reached as necessary conditions for taking ownership of the company, the company has not functioned in any way since its takeover as it has lost all its subscribers. Since 2001, the number of NITEL fixed lines has plunged from more than 500,000 to about 100,000, while the number of M-Tel mobile subscribers has crashed from 1.3m to a few thousand.

Consequently, NITEL which is the largest telecommunication company in Africa has been reduced to rubbles. Its 13,000 workforce has been reduced to scarcely 1,000 due to mass retrenchment, while those still privileged to be employed have not been paid for 11 months now. Despite not adding any value to NITEL since takeover, the Transcorp management did not only sell most of its choice assets but also used NITEL to borrow about $500 million from a consortium of banks.

The above is the disastrous achievement of the privatisation policy of government which its advocates have repeatedly touted as the magical solution to Nigeria’s economic problems. Within 30 months, NITEL which was already made ineffectual by decades of mismanagement and corruption of government and top management officials has been further reduced to rubbles by Transcorp.

Only the nationalization of NITEL and other public utilities under the democratic control and management of the workers linked with public ownership of the commanding heights of the economy can ensure that our public utilities work with by providing quality and affordable services to the people. The open democratic control by workers will ensure that fraud, sharp practices and corruption that are usually rampant in public corporations are made extremely difficult.

The DSM therefore calls on the NLC, TUC and LASCO to resist government renewed attempt to privatize NITEL through protest and strike actions. This demand must be linked with a comprehensive demand of organized labour against any form of privatization of public utilities including planned deregulation of the oil sector and for public ownership of the commanding heights of the economy under workers control.

We however call on the government having taken over the company to pay all the salaries and allowances owed to NITEL workers and recall immediately the labour leaders sacked by Transcorp management for protesting nine-month unpaid salaries.

Most importantly, labour must build a mass working peoples’ party with socialist programmes through which the masses can fight to take over political power from the hands of capitalist looters and put in place a workers and poor people’s government that can nationalize the economy under workers democratic control and management. Only this kind of government can seriously tackle the problems of poverty, inadequate schools and health care facilities, unemployment, worsening living standard, collapsed infrastructures and all other crisis afflicting the working masses due to decades of capitalist exploitation.