Nigerian government and oil subsidy regime: a horn of dilemma

Abstract

Virtually all modern independent States have, as their fundamental goals, the pursuit of the welfare and well-being of their citizens. To achieve these goals, the Nigerian State is required to harness its huge human and material resources for the development of the country. The paper examines the nature and politics of oil subsidy in Nigeria with the aim of identifying the forces behind subsidy removal. To scientifically analyze the issues raised, the study utilized political economy and public choice theories, an eclectic approach. The paper argued that the removal of fuel subsidy by the Federal Government in 2012 violates the fiduciary responsibility of the State as exposed in the preamble to the 1999 constitution. It showcases the insensitivity of the government to the social concerns of the citizenry and attempt by the oil cabal to privatize Nigeria. Given the catalogue of challenges facing fuel subsidy, it recommends among others, that institutions and institutional rules should be strengthened, be accountable and made autonomous of cabals and individuals who might want to manipulate them for group or personal interests. It concludes that unless the government predicates its legitimacy on the peoples‘ support and obedience derived from better socio-economic performance, the country might experience another democratic reversal.

Key Words: Economy, Oil, Politics, Removal, Subsidy, Nigeria