Short & Sharp: Oil benchmark madness continues

Will there be no end to the bad news from Abuja? Is this a democracy, where the leaders don’t listen to the cries of the led?

It was just a few weeks ago, at the 53rd independence anniversary, that the Senate chambers were flooded with crocodile tears by members lamenting  “the poor living conditions of many Nigerians and decay in infrastructure.”

Crocodile tears? That’s harsh. But we believe it is an accurate description of those lamentations. Why? Because if their tears were genuine regarding the wretched conditions in which the overwhelming majority of Nigerians live, our elected representatives would not now be preparing another extravagant annual budget which will consume $74-$76.5 of every $106 barrel of crude oil we sell.

The leaders of other oil producing nations, who sell in the same market, and who mean well by their people, peg their annual budgets at $25-$45/barrel. They collect the difference between this benchmark (approx. $61/barrel) and the current market price, totalling many billions of dollars, and use it to improve their people’s living conditions and upgrade their infrastructure.

In the Nigerian case, not only do our leaders organize for $74-$76.5/barrel to be eaten up (leaving approx. $30/barrel, half the revenue of the more prudent oil economies), the budgeted money is wasted in “recurrent expenses” (salaries, allowances, emoluments, easy living for senior public officials), which swallows over 70% of the already over-bloated budget.

How many more years will this madness continue?