Nigeria’s free food scheme a poor substitute for cancelled fuel subsidy

Ilorin — As soon as Hajira Abubakar heard there was food coming to the mosque in Ilorin, central Nigeria, in September, she rushed to join the queue but she was not fast enough and missed out on the free grain. This month she got to the distribution point early.

“If I make the same mistake, my children will have nothing to eat,” the mother-of-four told Thomson Reuters Foundation as she queued in the rain in the capital of Kwara state.

Two hours later, she was handed 5kg of rice. She was a little disappointed, having hoped also for beans and garri, a staple food made from cassava shavings.

Millions of Nigerians get free food every month as part of a scheme set up by the federal government to compensate for the loss of a long-standing fuel subsidy that newly elected President Bola Tinubu cut earlier in 2023.

The scrapping of the subsidy was part of a package of bold reforms meant to reinvigorate Africa’s largest economy but there is rising anger now that the government handouts do not go far enough to offset soaring prices that are partly the result of the subsidy cut.

Many people in this major oil-producing country consider cheap petrol a right. The last time a government tried to scrap the fuel subsidy in 2012, it caused nationwide protests.

This time, the biggest labour federations threatened to strike but in early October they suspended the action for 30 days after talks with Tinubu’s government yielded concessions, including a temporary wage increase for government workers and a three-month income subsidy for 15-million households.

Anger often explodes at the monthly food distributions, with scores of desperate people mobbing delivery centres with sporadic fights breaking out, according to Nigerian press reports and videos on social media.

Videos shared with Thomson Reuters Foundation showed elderly residents of Ilorin complaining that they had waited hours in a queue for 10kg helpings of rice but got only six bowls.

Critics say the food handouts simply do not go far enough to address the worsening cost of living crisis.

Bongo Adi, professor of economics at Lagos Business School, said the government should have researched the effects of the subsidy cut more thoroughly instead of simply introducing compensatory policies that did not addressed rising levels of poverty.

“Government should have done the equivalent economics of what to give the poor first ... because Nigeria’s infrastructure, roads and health and electricity systems are near collapse, and the subsidy on fuel was the only appreciable benefit that most Nigerians got,” said Adi.

Running at a loss

Tinubu, who has vowed to expand the economy by at least 6% a year, scrapped the costly petrol subsidy, which had kept energy and transport costs artificially low for decades, on May 29 — the day he took office.

The previous government had spent $10bn subsidising fuel in 2022 — nearly 25% of its budget — and Tinubu said it was no longer affordable.

But the cost of binning the subsidy was also high: by the end of June, petrol pump prices tripled, transportation and energy costs doubled, and the cost of food items such as tomatoes and yam increased more than 200% in the markets, with vendors blaming the rise on higher transportation costs.

Tinubu said the funds saved by scrapping the subsidy would be redirected towards education, infrastructure and healthcare. In July, he said the government had saved up to 1-trillion naira ($1.32bn) already.

But prices are still soaring. Annual inflation rose to 26.72% in September as Tinubu’s reforms, including a currency devaluation that sent the naira crashing against the dollar, kicked in.

Hakeem Hassan, who sells food in the southern city of Lagos, said a tuber of yam that cost 700 naira ($1.03) in May now goes for 1,500 naira ($1.94) because it costs more to hire a truck to bring the vegetables from the north.

“I’m running at a loss because many customers don’t even buy after they hear the new price; they can’t afford it,” he said.

Need breeds distrust

The grain distributions were introduced in August when the federal government released 200,000 tonnes of rice and maize from its reserves to Nigeria’s 36 states to be distributed to the poorest families.

It also said 5-billion naira would be given to each state as partly a grant and a two-year loan to buy 100,000 trucks of rice and 40,000 trucks of maize and fertilisers for farmers.

The need is enormous. More than 71-million of Nigeria’s 220-million people are living in extreme poverty, according to the World’s Data Lab poverty clock.

Nigeria’s National Bureau of Statistics describes more than 133-million Nigerians as “multidimensionally poor”, meaning they cannot access healthcare, education, water and adequate sanitation.

Community leader Yunus Magaji said he’s grateful for the food handouts but added that the majority of the 3,000 residents in Agunbelewo, a remote neighbourhood of artisans and craftsmen, were still struggling to get enough to eat, and only 100 people got food in the September distribution.

“We have a lot of old people who can no longer work, and we have people who have disabilities who can’t walk and depend on us to feed them; this won’t solve the hunger they’re facing since they took out the subsidy,” Magaji said.

The reported shortfalls at the monthly distributions have also inflamed Nigerians’ long-held mistrust of their federal and local rulers, with some citing previous examples of corruption in similar programmes.

Notably, during the Covid-19 pandemic in 2020, people stormed warehouses stocked with food items, known as palliatives, saying that the goods were being hoarded and only given to politicians and party loyalists.

Kolawole Oluwadare, deputy director of the Socio-Economic Rights and Accountability Project, said his organisation had filed a lawsuit against 36 state governors over their failure to account for their spending and to demand details of those who received free food.

“We can’t continue to have this opacity in government. What were the parameters for choosing the beneficiaries? When there is no clarity as to what citizens should expect, it suggests that there will be no accountability,” Oluwadare said.

Rafiu Ajakaye, a spokesperson for the state governor of Kwara, said authorities worked with non-partisan groups and religious bodies to make sure the food reached the most vulnerable. 

“The government is showing empathy because we know that everyone is feeling the pinch,” he said.

As Abubakar headed home from the mosque, she wondered if she might be able to barter some rice with food traders.

“They give me bread or beans because they also don’t have money. That is how we’re coping day,” she said.

Thomson Reuters Foundation