Nigeria: We′ll Shut Down the Economy, Says NLC

Labour unions yesterday called for mass protests and strikes for as long as it takes to get the government to withdraw what it calls "anti-people policies".

The Nigerian Labour Congress (NLC), warned Nigerians to start stockpiling food and carry out bank transactions before the strikes come into effect on June 18.

They want the government to return Value Added Tax to 5 per cent, reduce the price of fuel, rescind the sale of refineries, stop the sack of civil servants and pay those who have already been sacked their severance pay.

The congress also called on the National Assembly to step in and put pressure on the presidency "on behalf of the people".

NLC President, Abdul-wahed Ibrahim Omar, told an audience yesterday: "Our belief is that if the president is not part of the scheme to punish Nigerians, then they must distance themselves from these policies by reversing them. To do otherwise is to declare war on the Nigerian citizens."

They warned that strikes by their members would be "enforced" but did not say how this would be done.

Petrol tanker drivers, oil workers, commercial busdrivers and other public sector employees are members of unions affiliated to the NLC.

Omar said since the VAT hike came into effect on Monday, they have received messages of support from self-employed people in the "informal" sector like market traders.

Comrade Omar said: "The immediate trigger for our demands was the mindless increase in the prices of petrol, kerosene and diesel in the twilight of the former president's regime."

He said the increase was not done through the Petroleum Products Pricing and Regulatory Agency (PPPRA), and the National Assembly could therefore reject it.

The NLC on Friday urged President Umaru Musa Yar'Adua to reverse increase in VAT and petrol price, sales of refineries by former President Olusegun Obasanjo, and ensure the immediate payment of 15 percent salary increase to workers.

In a latter dated June 1, 2007 and addressed to the president, the NLC also called on the president to reverse the Value Added Tax (VAT) to five percent, and ensure the immediate payment of the 15 percent salary increment to workers.

The letter signed by the president of the NLC, Comrade Abdulwaheed Ibrahim Omar, said if by Monday June 18, 2007, the federal government fail to address the grievances of the congress, Nigerian workers will not hesitate to embark on an indefinite strike to press home their demands.

The NLC four-page letter entitled "Demand for Reversal of a Number of Policies and Actions Effected at the Twilight of President Obasanjo's Administration" reads in part: "The increase in the prices of petroleum products. Congress is convinced that the price increase was uncalled for. To begin with, the manner, in which the increase was effected, violated due process. The Petroleum Products Pricing and Regulatory Agency (PPPRA), which is responsible for regulating prices, did not meet. The argument being touted that there is need to reduce subsidy is long over worn. In the numerous engagements with government on this matter since 1999, we have advanced arguments on why the domestic prices of petroleum products should not be based on import parity prices.

"These engagements with government and other stakeholders resulted in the blueprint of the Petroleum Support Fund (PSF) for stabilizing domestic prices of petroleum products. What is needed is for the PSF to be adequately funded. When the 2007 budget proposals were placed before the National Assembly, we drew attention to the inadequacy of the provisions made for the PSF. What is needed now is for a supplementary appropriation to be made to sustain the PSF, rather than the increase in the pump head price.

"Given the high rate of dependence on private energy generation by manufacturers and other producers, necessitated by unstable and unpredictable power supply, and the near total dependence on road transportation for the movement of goods and persons, the cost of domestic production and prices of goods and services have increased substantially and will continue to increase if this increase is .allowed to stand. This will further lead to a loss of competitiveness of domestic goods and services in the domestic market, resulting in lay-offs, closures of factories, unemployment and increased poverty. A higher kerosene price in particular will result in continuing deforestation and the attendant negative impact on the environment.

"We therefore call on you, sir, to direct an immediate reversal of the price increase. Domestic prices should continue to be stabilized within the framework of the PSF. If appropriated funds for the support are inadequate, supplementary appropriations should be requested of the National Assembly.

"The 100% increase in the VAT rate from 5% to 100/0: The fact that this has been done through administrative fiat once again demonstrates the contempt for due process and the rule of law which has characterised governance in the past eight years. We recall that an executive bill seeking to increase the VAT rate from 5% to 10% had been placed before the National Assembly in the past. After due deliberations and public hearing, the National Assembly declined ascent to the aspect of the bill seeking to raise the rate. To fall back on the provision of a military decree to effect the increase through administrative fiat, even where the constitution is clear that no taxes can be levied without the approval of the National Assembly, smacks of political dishonesty.

"The argument that the rate needs to be raised to bring it into compliance with ECOWAS requirements cannot be a justification for the manner in which the increase was introduced. We still have upwards of two years to come into compliance, if we must. In any case, the needs of our national economy and national interest must drive our policy. "By its nature, VAT is a regressive tax which places undue burden on the poor. By raising the level of prices, raising the rate now wi1l further erode the weak demand for goods produced by our industries. This will lead to the collapse of more domestic firms, resulting in lay-offs and rising unemployment.

"Your Excellency, the burden of a doubling of the VAT rate is one burden too many on the workers and citizens of our country. What we need for now is working to grow our economy so as to expand the tax base, rather than suffocating the space for growth by escalating the tax rates. We, therefore call on you to return the VAT rate to 5%, which in our view, is the subsisting legal rate.

"Implementation of the 15% Increase in Salaries: As for the 15% increase in the salaries of public sector employees, an immediate and unconditional implementation of the increase with effect from January 2007 is the only honourable thing to do. Congress had in November 2006 made formal representation to government on the inadequacy of the proposed 15% increase. This was predicated on the history of understandings reached with government over the past eight years. As we indicated in our letter to government then, the 12.5 per cent increase which was implemented in 2004 was a whittled-down increase of the 25 per cent which had been agreed. It had also been agreed that further increases will be implemented as part of a process to gradually approach a living wage in the public sector and bridge the yawning gap between private and public sector pays.

"We are aware that the Chief Shonekan Committee, in which we were represented, recommended an increase of 25 percent as a first step in the process of bridging this gap. Our appeal to you is that an immediate and clear directive on the implemen-tation of the awarded 15% be given. Thereafter, a collective bargaining framework to negotiate the acceptable level of increase should be instituted.

"Payment of Arrears of Monetization Benefits: Also pertinent are arrears owed workers over a period of two years in respect of monetization benefits. The failure to pay the arrears ti1l now is a clear violation of agreement reached with government within the framework of collective bargaining. We demand urgent payment of the arrears outstanding.

"Mass Sack and the Reform of the Public Service: Under the guise of reform, government has embarked on and prosecuted a programme of mass sack in the public service. We call for an immediate halt to this sack. The linkage of the payment of the 15% salary increase to the carrying out of mass sack in public sector establishments is completely unacceptable. We call for a withdrawal of the circulars that have directed this linkage.

"Staff that have already been laid off were promised their severance benefits at the point of severance. This promise has not been kept. Retrenched workers in this category should be paid their severance benefits without further delay.

"The Sale of Port Harcourt and Kaduna Refineries and other national assets: Beyond these issues, Congress is alarmed at the rushed sales of the Port Harcourt and Kaduna refineries, as well as Egbin Power Plant and other national assets in processes that were completely devoid of due process and transparency. Our position continues to remain that these establishments should remain public. Why is it that those that are now awarded these national assets could not take advantage of subsisting licences for setting up new refineries in the past eight years? How much of public funds has been ploughed into the refineries in the past eight years and are these colossal sums recouped? That a government at the twilight of its mandate would rush to hand over these and other national assets in such non-transparent manner raises questions about intent and probity. We call on you to institute high level judicial panels of inquiry to investigate these transactions, as well as other questionable ones such as the sale of NITEL, Ajaokuta Steel, and the National Theatre."

The presidency could not be reached for comments. It was believed that Umar Musa Yar'Adua may have left for Germany last night to attend the G8 summit.

Source: allafrica.com

Publication date: 6/8/2007

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