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The Federal Government has commenced discussions with representatives of the organised labour on how to raise the freight rate of the Premium Motor Spirit (PMS), otherwise known as petrol, from N7.51 per litre to N9.11 per litre.
This implies a 21.30 per cent hike in freight rate, which is a component of the total cost of petrol under the template of the Petroleum Products Pricing Regulatory Agency (PPPRA). This increase in freight is expected to affect the total calculation, unless there is an equivalent reduction in other cost elements.
Executive Secretary, Petroleum Equalisation (Management) Board (PEF), Alhaji Ahmed Bobboi , made this known at the 21st Annual General Meeting (AGM) of the National Association of Road Transport Owners (NARTO) held at the Zuma Rock Resort, Niger State.
He said the agency was waiting for the Federal Government approval before it would begin the implementation of the new freight rate of N9.11 per litre.
He added that the Federal Government was expecting the labour unions to revert to it on the agreement it has taken from the joint committee set by the government on the hike in the price of petrol and electricity.
Asked to comment on the implementation of freight increase, Nigerian National Petroleum Corporation (NNPC) Group Managing Director (GMD) Malam Mele Kyari said upon the conclusion of the deliberations labour, the Federal Government will announce the effective date in line with the pricing template.
“The Executive Secretary of PEF made a statement that there is on-going engagement between the Federal Government and the labour, and at the end of that process government will make adequate pronouncement as to the effective date of that figure as contained in the pricing template,” Kyari, who was represented by the corporation’s chief financial officer, Umar Ajiya, said.
In his goodwill message, Kyari praised the association for its operations despite the daunting challenges in the country.
“We are not unaware of the conditions of our roads, the insecurity, the highways, and also a number extortions do take place along these highways,” Kyari said.
He urged the association to ensure that its trucks and drivers comply with safety standards at all time which has been put in place by the regulator towards ensuring hitch-free operation at the depot and on the highway.
He promised the NNPC will continue to cooperate with the association to resolve all the challenges impacting in the distribution of products in the country.
Kyari noted that the NNPC will continue to make payment to PEF for deductions of dues due to NARTO so that PEF will continue to pay members as and when due.
He urged the transport owners to ensure that their tankers and drivers meet the safety standards set by government regulators for the industry to curb accidents involving petrol tankers.
National President, National Association of Road Transport Owners (NARTO) Alhaji Yusuf Othman urged the government to implement the new N9.11 freight rate to enable the transport owners improve their services and increase the wages of their staff including the truck drivers.
Othman assured that NARTO would continue to work to improve the safety of their truck and drivers.
According to him, with the promise of the increase in freight rate there will be more income that will allow more investments in the facilities and at the same time, drivers will be happy because there is clamour from them to increase their package and allowances from now to next month.
“I believe if that freight cost is reviewed, we are going to assent to their clamour and things will be fine by the grace of God,” Othman said.
He said the association has made significant contributions to the national economy noting that apart from accounting for a large percentage of revenue to government through taxes, rate and levies, NARTO is the biggest employer of labour next to the federal government.
He pointed out that for every truck loaded, about 20 people derive their livelihood including their defendants from origin to destination.
He described the association as the mouthpiece for the projection and articulation of transporters’ problems to the extent that it was able to set up machinery for periodic review of freight rate with the Federal Government for the interest of all transport in Nigeria.
According to him, NARTO provides statistics for the Federal Government, its agencies and parastatals on vehicle costs, operation and data numbers of vehicles in circulation in the country from time to time.
The Central Bank of Nigeria (CBN) said it plans to make the association to be the sole transporter of the outputs of all its programmes, including the petroleum products from the Dangote Refinery.
Representative of Development Finance Department of the CBN, Babatunde Zaccheus, said NARTO members will be transporting dry season farming outputs and products from the Dangote Refinery that is coming on stream very soon.
He commended the association for coming to the apex bank’s rescue when it needed to transport the fertilizers for dry season farming during the COVID-19 lockdown.
“NARTO came in at a time when we were having difficulty during the COVID lockdown. We wanted to have vehicles to move a lot of fertilizers and NARTO came on across the country. NARTO came in and delivered. We look forward to a more harmonious working relationship. Dangote Refinery is coming on stream. We are going to be using NARTO for all the programmes that we run.
“For the dry season farming this year, CBN is going to be funding quite a lot of players, we are doing the largest during season and farming programme across the country. And NARTO is going to play a key role both the logistic movement of the inputs and also the outputs that have been cultivated,” Zaccheus said.