User:Mcorizu/SURE-P Subsidy Reinvestment and Empowerment Programme

SUBSIDY REINVESTMENT AND EMPOWERMENT PROGRAMME (SURE-P)
The reduction of the fuel subsidy by the Federal Government in January 2012, as a deliberate policy aimed at conserving and maximizing the oil wealth of Nigeria, generated cries of discontent, fear and worry amongst Nigerians which led to a national strike. In response to the cries of Nigerians, the President announced the Subsidy Reinvestment and Empowerment Programme (SURE-P) to reinvest the Federal Government’s share of the savings arising from the reduction of subsidies on petroleum products into programmes and initiatives that would go a long way to ease the pain of subsidy removal and create a better life for Nigerians.

SURE programme therefore ensures that the Federal Government’s part (41%) of the savings from partial removal or reduction of fuel subsidy is applied on critical infrastructure projects and social safety net programmes that will directly ameliorate the sufferings of Nigerians and mitigate the impact of subsidy removal.

Presidential Mandate

President Goodluck Ebele Jonathan inaugurated the SURE-P Committee on the 13th of February 2012 under the leadership of Dr. Christopher Kolade CON. The mandate from the President to the SURE-P Committee is to `deliver service with integrity’ and `restore people’s confidence in the government’. The Committee has therefore expressed its desire to ensure that the use of the fuel subsidy savings to deliver the programme mandate is done with utmost probity, transparency and accountability.

Programme Objectives The objectives of the proposed Subsidy Reinvestment and Empowerment Programme are:


 * To mitigate the immediate impact of the partial petroleum subsidy removal on the population by laying a foundation for the successful development of a national safety net programme that targets the poor and vulnerable on a continuous basis. This applies to both the direct and indirect effects of subsidy withdrawal.
 * To accelerate economic transformation through investments in critical infrastructural projects, so as to drive economic growth and achieve the Vision 20:2020.
 * To promote investment in the petroleum downstream sector.

Programme Structure
Individual projects are managed by Project Implementation Units (PIUs) that are located within Federal Government Ministries, Departments and Agencies (MDAs). Projects and programme oversight is done by the SURE-P Committee working through its steering committee and seven subcommittees. The subcommittees are extensions of the committee to provide direct supervision to the projects. The Committee also has a Secretariat that provides technical and administrative support to both the Committee and its subcommittees, and provides information to stakeholders and the general public.

Sub-Committees of the Main Committee

The Committee established the following subcommittees to carry out the day-to-day monitoring, validation and evaluation of specific projects, and make recommendations to the main Committee: Steering Subcommittee

Social Safety Net Programmes
 * Maternal and Child Health Subcommittee
 * Public Works Subcommittee
 * Vocational Training Subcommittee
 * Community Services, Women and Youth Employment Subcommittee
 * Culture & Tourism Subcommittee

Infrastructure Project
 * Roads and Bridges Subcommittee
 * Niger Delta: East-West Road Subcommittee
 * Railways Subcommittee
 * Mass Transit Subcommittee

SURE-P Secretariat

The Secretariat was created to provide technical, administrative and information support to the Committee. The Secretariat is located on the First Floor Phase 3 of the Federal Secretariat complex and is made up of the following functional units; Administration and Finance, Performance and Results, Communications, and the Committee Support.

HISTORY OF SURE-P
DEREGULATION OF THE PETROLEUM INDUSTRY

One of the pillars of the Transformation Agenda of the Federal Government is the progressive deregulation of the petroleum industry. In January, 2012, the decision to remove the subsidy on Premium Motor Spirit (PMS) was announced by government, with the following as the official explanation for instituting the policy.


 * The subsidy regime in which fixed prices are maintained irrespective of market realities has resulted in a huge unsustainable subsidy burden.
 * Fuel subsidies do not reach the intended beneficiaries. Subsidy level is directly correlated with household income, as richer households consume larger quantities of petroleum products. Consequently, the subsidy benefits mostly the rich.
 * Subsidy administration is beset with inefficiencies, leakages and corruption.
 * Subsidy has resulted in the diversion of scarce public resources away from investment in critical infrastructure, while putting pressure on government resources.
 * Subsidy has discouraged competition and stifled private investment in the downstream sector. Due to lack of deregulation, investors have shied away from investment in the development of refineries, petrochemicals, fertilizer plants, etc. It is important to note that since the year 2000, government has issued 20 licenses for new refineries, none of which has resulted in the construction of new refineries.
 * The deregulation of the downstream sector of the petroleum industry will lead to rapid private sector investment in refineries and petrochemicals, which will generate millions of jobs and lead to increased prosperity for our people.
 * Huge price disparity has encouraged smuggling of petroleum products across the borders to neighboring countries, where prices are much higher. Nigeria therefore ends up subsidizing consumption of petroleum products in neighboring countries

Term of Reference
The terms of reference are as follows:


 * Determine in liaison with the Ministry of Finance and Ministry of Petroleum Resources, the subsidy savings estimates for each preceding month and ensure that such funds are transferred to the Funds' Special Account with the Central Bank of Nigeria.
 * Approve the annual work plans and cash budgets of the various Project Implementation Units (PlUs) within the Ministries, Departments and Agencies (MDAs) and ensure orderly disbursement of funds by the PlUs in order to certify and execute projects;
 * Monitor and evaluate execution of the funded projects, including periodic Poverty and Social lmpact Analysis (PSIA);
 * Update the President regularly on the programme; e. Periodically brief the Federal Executive Council (FEC) on the progress of the programme;
 * Appoint Consulting firms with international reputation to provide technical assistance to the Committee in financial and project management;
 * Appoint external auditors for the fund;
 * Do such other things as are necessary or incidental to the objectives of the Fund or as maybe assigned by the Federal Government;
 * The Committee is supported by a Secretariat that will also be responsible for communication and press briefing.

TENURE/DURATION OF SURE-P

The Subsidy Reinvestment and Empowerment Programme was designed along the line of the transformation agenda of the President, the life span of which is 2012 – 2015.