ELECTRICITY BILLS HIT ROOFTOP AS CONSEQUENCE OF THE TARIFF HIKE
LABOUR LEADERS AND GOVERNMENT AGREEMENT UNDERMINES THE INTEREST OF WORKING MASSES
CARE CALLS FOR REVERSAL OF THE HIKED TARIFF AND AN END TO ELECTRICITY PRIVATISATION
COALITION FOR AFFORDABLE AND REGULAR ELECTRICITY (CARE) Statement November 17, 2020
As a fallout of the over 100% electricity tariff hike that took effect from September 1, 2020, bills afterwards have become so high, some residential consumers got as much monthly bill as N30,000 or more. This is an indication of what is to come as the tariff plan goes from the so-called Service Based Tariff to Cost Reflective Tariff; electricity bills are in many cases higher than the minimum wage invariably many people will be denied the little electricity they previously enjoyed. Coalition for Affordable and Regular Electricity (CARE) sees the new tariff as unaffordable for the vast majority and should be reversed to the pre-2016 tariff, which is about N13 kwh.
Ayuba Wabba led Nigeria Labour Congress (NLC) and Olaleye-led Trade Union Congress (TUC) entered into a negotiation and unfortunately further strengthened the hands of the bourgeois exploiters. The rightwing reactionary labour leaders like Emma Ugboaja, Ayuba Wabba and Musa Lawal Ozigi went to town holding imaginary laurel similar to bourgeois politicians who build a borehole for a population of over 20,000 people with fanfare. We should remind these turncoat labour leaders that NERC’s Multi-Year Tariff Order 2020 (MYTO) reviewed MYTO 2015 and was to be implemented in January 1, but due to agitations of Nigerians, it was postponed to 2020, April 1, 2020, July 1, 2020 before it was implemented on September 1, 2020. Without the threat of a general strike, Nigerians successfully stopped the anti-poor Buhari-led government from hiking electricity tariff for 8 months while the so-called intervention of the labour leaders seemingly suspended the tariff increase for about three weeks and marginal reduction of the outrageously hiked tariff for three months despite the threat of a general strike. The negotiation turned out to be a jamboree as these rightwing labour leaders did not present any document because they had none. Rather it appeared they went for an excursion like little children that have to be taught how electricity tariff must be so high despite the poverty in the land. It is shocking that the October 8, 2020 agreement of FG/Labour Technical Committee stated that it collected and reviewed over 50 documents submitted by Government MDAs, Presidency, NERC, Bureau of Public Enterprises (BPE), Transmission Company of Nigeria (TCN), Nigeria Bulk Electricity Trading Company (NBET), Distribution Companies and there was no mention of any document from NLC, TUC or Nigeria Union of Electricity Employees (NUEE) – what a shame! It shows clearly that there was no intention from these rightwing labour leaders to engage the government with the aim of defending the interest of workers and the poor masses.
It was not just a disservice for Labour leaders to endorse the privatization, deregulation and also agree to further hikes in electricity tariff by way of transiting from the current exorbitant Service Based Tariff (SBF) to Cost Reflective Tariff (CRT) which will be heading from frying pan to fire, it is a betrayal. It was a monumental contradiction for labour to agree to transit to higher tariff and at the same time requesting to be tutored on how the government arrived at the Service Based Tariff Rates- it amounts to struggling to save face. In reality, the Buhari-led government through NERC had explained in their MYTO 2020 document in December 2019 how it arrived at the higher tariff but as usual these rightwing reactionary labour leaders refused to engage the government because they lacked an alternative programme to neo-liberal capitalism. In the MYTO 2020 document, NERC strived to justify the hike on the bases of high gas price, exchange rate, inflation rate in Nigeria (11.3%) and US rate of inflation (1.8%). Nigerian workers and the poor masses were never responsible for these chaotic indices used in justifying the hike in tariff, moreso, when inflation in the United States of America is one of the indices used. The failure of the past and current capitalist government is responsible for the growing cost of living, inflation, lack of jobs, lack of infrastructure, lack of industries, forcing the working masses to pay for the failure of the capitalist with the support of the rightwing, aristocratic labour leaders is criminal. As an oil and gas producing country, our ruling elite wants her citizens to pay international prices while workers do not earn international wage, it explains the reason President Buhari was ‘worried’ why Nigerians should be paying lower price for petrol compared to Saudi Arabia! If the ruling elite and rightwing labour leaders do not know what is known as comparative advantage, they should pick up secondary school economics textbook. In fact, the incessant hike in electricity tariff is a motivation for the power company to fail. The so-called N540 billion government spent in subsidizing electricity in 2019 is a ruse; what NERC is telling Nigerians is that the amount spent on subsidy is three times more than the 2010 budgetary allocation to the power sector in a year electricity supply was better- what a contradiction. This subsidy is nothing but a fraud!
Another area disturbing in the labour/FG agreement is the current tariff that is tied to the level of service consumers receive, which invariably means higher supply attracting higher tariff plan. We do not see the logic in this kind of pricing as it will give the power companies (DISCOS) the opportunity to create an apartheid-style supply and pricing. For instance, DISCOs can simply prioritize the supply of electricity to rich communities and industrial areas in order to make more money leaving out poorer communities in darkness, a policy that has been in place for some time and is being legitimized and sustained. Before the new tariff hike, Ikeja Electric, just like the other DISCOs has a supply package called ‘Premium Power’ wherein about 20 hours of electricity is supplied to rich communities for a higher rate of about N56 Kwh. If the rightwing labour leaders is not querying this policy, it is simply because they are disconnected from the average worker.
According to the agreement, tariff has been categorized according to hours of supply. There are some communities whose supply is categorized into 12 hours or 16 hours and they are on one form of load shedding or the other due to bad state of power infrastructure or lack of it; thereby subjecting the communities to epileptic electricity supply. Practically, there is no way of measuring the hours of supply because the prepaid or postpaid meters only measure the quantum of supply and not hours. Going by this exploitative policy, we are back to estimated billing on a mass and bigger scale, because there is no way the consumers can hold the power companies to account in terms of the targeted monthly supply. Between May 2012 (N7.3) and February 2016 (N21.3), there were four tariff hikes amounting to 300% increment and yet there was no significant improvement in basic power sector infrastructure, rather we witnessed a degeneration.
The General Secretary of the Trade Union Congress (TUC), Mr Musa Lawal Ozigi stated in an interview published by National Record on October 9, 2020 that deregulation will bring down the prices of electricity and petrol just like price of sim card and telecom charges. NERC Commissioner, Dafe Akpeneye made the same point in an interview with Punch Newspaper of November 8, 2020. This position is fraudulent. Just like prepaid meters, sim card is supposed to be given free of charge because it is not the service, it is a means to serve. It is like going to a shop and being charged for stepping into the office shop premises and also charged for buying goods, what the telecommunication companies did and the DISCOs are doing by forcing consumers to pay for meters is stealing; this robbery is taking place because the government supported it. Per-minute tariff of the telecom cartel was broken because the then newcomer was desperate to break into the market and since then, tariff plan has steadily gone up because a new cartel was formed. We should take a look at the concession of terminals in the Maritime sector, the deregulation of Kerosene and Diesel and the general manufacturing sector, where has competition and neo-liberal policies fundamentally brought down prices on a sustained basis? Rather, the cost of living keeps going up. Competition could cannot bring down the price as long as profit is accommodated. It is not competition that fundamentally brings down prices, because pricing cannot go below the cost of production, it is the lowering of the cost of production through the acceleration of exploitation or considerable investment in the means of production. Nigeria has one of the poorest infrastructure in the world, her electricity is near to darkness, roads are deathtrap, schools are in shambles, hospitals are largely a pathway to the mortuary, residential communities are like jungles, the vast majority have been forced to marry poverty like their lives depend on it and Nigeria is the current poverty capital of the world. To sustain profiteering, there will always be a reason to hike electricity tariff, increase fuel prices etc. The capitalist ruling elite is dreaming of resolving the capitalist contradictions by robbing the poor but the principle of robbery only takes humanity backwards in the long run. Just like an average bourgeois politician, Ayuba Wabba and co are too aristocratic and rich to be affected by petrol price of N170 or even N300 per litre or electricity tariff of N60 or N80 Kwh, they are enjoying the crumbs that fall from the master table like bellboys.
Metering and estimated billing is another grey area. Coalition for Affordable and Regular Electricity (CARE) has been clamouring for prepaid meters to be issued to all consumers for a long time and we have maintained that prepaid meters should be issued to all consumers free of charge. All this while, the government has through the Nigeria Electricity Regulatory Commission (NERC) introduced one subterfuge or the order meant to arm-twist electricity consumers into buying prepaid meters at exorbitant prices. It has become clear that like the previous governments the current Buhari-led government is in an unholy alliance with the power companies to extort and exploit consumers. The National Mass Metering programme (NMMP) of the federal government aimed at distributing 6 million meters free of charge looks good on the surface but it is the typical bailout of privileged businesses to the detriment of the Nigerian taxpayers and the working masses. We must not forget that a chunk of the N213 billion that the federal government gave the power companies in 2015 is yet to be paid back. This latest intervention by the federal government will not be different as it will turn out to be another case study of using public funds to bail out irresponsible and failing private companies.
What the power sector needs is massive investment, private sector is incapable of providing such funds considering the fact that cost of fund is high, purchasing power is very low and the banks are on constant bailout from the public sector. Despite spending over $20 billion on the power sector in the last 13 years, the sector has not gone beyond 5,000 Megawatt, corruption and outright looting is responsible for this poor result. Yet according to World Bank, only 56% of Nigeria’s population have access to electricity, a scorecard that indicts the ruling elite, privatization and capitalism.
We have to organize in communities to resist high electricity tariff and exploitative billing, demand metering of every household and workplaces and fight for renationalization of the power sector under democratic control of workers and consumers in order to guarantee judicious use of resources, just billing system and regular power supply.
The gatekeepers (rightwing labour leaders) have not just abandoned the gate, they have connived with self-serving ruling elite to rob the working masses, so unfortunate. When Ayuba Wabba stated in its NLC press statement on October 1, 2020 that government made about N400 billion profit from the privatization exercise, it shows the depth of crises in the trade union movement; whereas government actually privatized for about N500billion and almost the same amount was spent to settle disengagement entitlements of workers leaving it with little or no money, a classical example of a weird privatization wherein private companies bought public assets without any liability. In actual fact, the power sector is worth more than 10 trillion even in its decrepit condition, selling over 50% of its worth (over N10 trillion) at N500 billion cannot be profit, it was giveaway price to enhance the prospect of profiteering, it is a rip-off, it is looting. In other words, Nigerians were not surprised by the outcome of the so-called negotiation. In actual fact, what would have been shocking is if the rightwing labour leaders had prosecuted the strike. The ENDSARS mass protest was an indictment on the Ayuba Wabba-led trade union movement, Nigerians have lost confidence in them.
Privatisation has failed, Buhari’s government just like the previous capitalist government has failed also; the working people need to struggle to defeat privatization, deregulation and other capitalist policies if this country will ever move forward. The bourgeois ruling elite that ruined this country cannot fashion out a solution, it can only be worse under its reign. Workers and the poor masses should build a mass political movement on a socialist programme to defeat this capitalist government and its pro-capitalist rightwing reactionary labour leaders. Resistance to these attacks, particularly the hikes should begin with mass mobilization and resistance against DISCOs and the government and demand reversal to N13 Kwh, renationalization and massive investment in the power sector under democratic control and management of workers and consumers, as well as improvement of the working conditions of electricity workers.
Chinedu Bosah Shoyombo Monsuru
National Coordinator National Secretary
Email: [email protected]