The Hike in Electricity Tariff is Another Anti-Poor Policy; For a Total Reversal!

PRESS STATEMENT

16th April, 2024

The Hike in Electricity Tariff is Another Anti-Poor Policy

• We call on NLC and TUC to mobilize workers to struggle against the hike
• Every community deserves equal access to regular, affordable and uninterrupted power supply
• For the renationalization of the power sector now

The Revolutionary Socialist Movement (RSM) condemns the recent hike in electricity tariffs by the Nigerian Electricity Regulatory Commission (NERC). This new tariff was announced on Wednesday, April 3 and took off with immediate effect. The new tariff represented over a 330% increment for consumers under the Band A tariff category from N68/Kwh to N225/Kwh.

According to the NERC, Band A represents the category of consumers that enjoy at least 20 hours of electricity and about 15% of the total users fall into this category. Similarly, NERC claimed that the increment from N68/kWh to N225/kWh was made following consultations with the 11 electricity distribution companies (Discos) as well as the inability of the federal government to pay the over N2.9 trillion subsidy that would maintain current rates up to the end of December 2024.

The Minister of Power, Adebayo Adelabu, noted, during a media briefing at Abuja, that the increase is a first step in phasing out electricity subsidies for all consumers in the country. The implication is that customers on the other bands of electricity tariff will also have to pay more in the coming days when the subsidy is fully removed.

RSM notes that this is not the first time subsidies will be removed under the Tinubu regime. The Tinubu-led Federal Government first removed subsidies on PMS which supervised a huge 350% increment in the price of PMS and automatically a rise in the cost of transportation, goods, and services and general cost of living. As we warned during that period, the removal of subsidies without a clear plan of activities will only add to the already heavy burden of the working people.

Unfortunately, the leadership of the labour movement did not lead the workers to demand a return of the subsidy but instead negotiated for a paltry, temporal wage award of N35,000.

Again, the Tinubu-led Federal Government struck with the floating of Naira. Again, we warned that an economy like that of Nigeria that depends solely on importation cannot completely float its currency to compete in the international market. The singular act saw the Naira value move from around N700 per dollar to N1,900 per dollar, signalling an average of 271% reduction in the value of Naira in the international market. This, again, caused a super-inflation in the cost of staple foods and household items and led to another resistance of the working people tagged the ‘EndHunger’ protest. Although the Naira has started appreciating over the past few days, this has been at the expense of the country’s foreign reserve.

As if all of these are not enough, the irresponsive Tinubu government has again decided to remove the subsidy on electricity! This means that the government is gradually putting an end to all of the benefits that the common and ordinary people enjoy from the government. The same Tinubu government that cannot guarantee the safety of her citizens, or provide grants for academic advancements believes that the only way to a better life is by retracting all the national benefits in terms of subsidies and subjecting the people to more hardship of high cost of living and economic uncertainty.

The truth is that this policy would further impoverish Nigerians who are currently battling the hardship caused by fuel subsidy removal and the devaluation of naira. The government’s decision to increase electricity tariffs is insensitive. In reality, this policy will affect the workers more because the price of goods and services will go up while their wages remain unchanged. Even if the salary is slightly improved in the upcoming salary review program, the private and self-owned businesses, farmers, traders and the toiling people will have little or nothing to benefit from. It will similarly make the operating environment more hostile for manufacturers and small-scale businesses and may lead to closures and loss of jobs.

We at the Revolutionary Socialist Movement strongly believe that this anti-poor policy aims to widen the gap between the rich and the poor. It is aimed at putting more money into the pockets of the DISCOs who have, since taking over the electricity sector, done nothing to improve the overall supply and delivery of power to Nigerians.

Similarly, we of RSM condemn the attempt of the Federal Government, through the NERC, to segregate the citizens into categories (or Bands) using the rate of electric supply as a yardstick. This is evidence of favouritism or partiality as the electric distribution companies tend to favour some parts of the communities than others. It further proves that the government has the power to supply power equally and evenly to every part of the country. If some part of the country can have access to 20 hours of power supply, it means every part of the country can have access to the same quantity.

The power plants and facilities were built and funded using the Nigerian taxpayers’ money. Hence, every Nigerian deserves equal, affordable, and uninterrupted power supply irrespective of social status.

We do not agree with the Federal Government’s usual excuse that removing subsidies is the only way to fund other social amenities like education, healthcare, and electricity. As we have seen in both the education and electricity sectors, citizens are now forced to pay through their noses for these services. For instance, instead of introducing study grants to foster quality studying and more enrolments in education, the Tinubu-led Federal Government instead provided student loans which will undoubtedly increase the cost of education (since loans are now provided) and push many young innocent youths into pits of debt. Our position ever since is that the government should heavily tax the rich and subsidize the poor.

The solution to the unending crisis in the power sector is singular; the re-nationalization of the power sector under the democratic control and management of the working people. Since privatising the power sector, Nigeria has spent trillions of Naira on bailouts and subsidies for private companies with nothing to show for it. Even, the implementation of a pay-as-you-go (prepaid) system has not been effective because of the greed of the DISCOs. Nigerians keep paying for darkness while the rich private holders of the distributions, transmission and generations companies keep allocating millions of naira to themselves as salaries.

The continuous collapse of the national grid is another talking point. Between January 2024 and March 2024, the national grid has collapsed 5 times, throwing the entire county into darkness. In September 2023 alone, 3 power grid collapses were recorded within 5 days. On December 12, 2023, the national grid collapsed from 4,000MW to 43MW. This is a further indication that privatization will not work and that the power sector should be re-nationalised put under public ownership and be subjected to the democratic control and management of the working people. This is when we can start to use the available resources to meet the genuine needs and aspirations of the vast majority of Nigerians. Furthermore, this will drive down the cost of electricity – as the hands of the big men profiteers would have been eliminated – and make it affordable for all Nigerians.

We call on the NLC and TUC as well as the affiliates union to take this struggle forward, beyond mere press statements. The unions need to start organising and mobilizing the workers for a mass protest to challenge the insensitivity of the Tinubu-led regime. This kind of struggle should not be limited to the reversal of electricity tariffs alone but also to the renationalisation of the power sector. When a genuine struggle like this commences, we of the RSM will mobilize our forces and participate actively in it.

Salako Kayode

RSM Publicity Secretary