The burden of fuel price in Nigeria

With the recent hike in fuel prices in Nigeria from NGN650 to NGN897 by the country’s national petroleum body - NNPCL, cost of transportation and general costs of goods and services in the country will only rise higher. This means that inflation that is already high will inch higher.

The burden is felt by all, be it those in government, or in the private sector, but the most hit is the employee and the small business owner. We cannot forget the retirees and a fixed pension too. Actions must be taken immediately to support this class of people and keep them from sinking further into the economic quicksand. The following are a few suggestions.

-????????? Every organisation will have to look for ways to ameliorate this cost pressure on their employees. Those that have stopped hybrid or remote work should revisit this option to reduce the cost burden on their employees and help the employees focus more on their job. This is time for HR managers to step up and drive productivity in a way that benefits all parties.

-????????? Organisations should look for how to increase the employees’ disposable income to enable them cope with the burden of the fuel price increase. Another example is the introduction of a fuel allowance as part of employee pay. Or make transport arrangements covered by the organisation for the employees. There can simply be a direct increase in the overall renumeration of the employee to meet the projected inflationary gap; like a 45% increase if the organisation can afford it.

-????????? Employees with cars should look closely at other options like carpooling. Taking public transport on some days in the week or discussing hybrid work with their employers. I have already gotten requests from some employees for some organisations, seeking jobs that are closer to their places of abode.

-????????? I expect the government should stop controlling prices (like they claimed to have done) for such sensitive commodity to enable it to find its level instead of continuously increasing the peoples burden every time the people are just breathing a sigh of relief. There are key infrastructures like power, transport, fuel, telecoms, education, healthcare and food that if the government allows to be run by the laws of demand and supply and focus on how to ameliorate the effects, the economy should balance up in no time. For example, instead of controlling the price of transport, provide many alternatives that are all efficient and safe, introduce a scholarship system from primary school to university but tied to a strategy direction like scholarship in various sports skills, scholarships for STEM studies, tax and other incentives including realistic single digit loan sums for businesses in healthcare and healthcare development. Let’s start consuming 100% home produced items starting from government. There is so much to say but I hope this little bit is heard and acted on.

-????????? Organisations need to redraft the way they run their business costs urgently. They will need to do more outsourcing and remote work to reduce their cost burdens. The small business can work with shared offices or use co-workspaces instead. They should look at eliminating cost items like paper, minimize transport (movements), and encourage their staff to re-skill and up-skill so they have multi-talents to multi-task and do more with less.

-????????? Employees need to start looking beyond their 9-5 income and inquiring about solutions that provide additional strings of income beyond 9-5 jobs.

As long as reforms continue, change will continue, and we pray its only for the general good. The only sure way is the way forward, go that way and may God go with you.

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Ayo Emakhiomhe.