ICRC or Competition Commission?

No Comments » December 24th, 2008 posted by // Categories: General Articles



ICRC or Competition Commission?

 

On Wednesday, 03 December 2008 a fellow columnist, Mr. Godwin Erapi wrote a column in Business Day newspaper with the heading: ICRC: yet another bureaucracy? The piece raised a number of pertinent issues, questions and concerns following the formal inauguration by President Umaru Musa Yar’Adua (UMYA) of the Board of the Infrastructure Concession Regulatory Commission (ICRC) on 27th November 2008. The ICRC is the latest addition to the burgeoning public bureaucracies in Nigeria, coming just after the creation of a new Ministry for the Niger Delta and the de-merging of the ministries previously merged by President Obasanjo in the twilight of his administration in 2007.

 

The points raised by Mr. Erapi are cogent and need no repeating here and I fully endorse the analysis he made in that excellent piece. My additional contribution to his analysis is to question the rationality of creating the ICRC by the government at this time in the first place. This question tally’s very well with Mr. Erapi’s concern about what he said is “…the replication of organisations crippled by bureaucracy that are tasked with carrying out similar mandates.”

 

On this very concern, I would like to quickly point out that the mandates assigned to this latest baby bureaucratic body, if they are not substantially similar to the mandates of the Bureau of Public Enterprises (BPE) and its supervising authority, the National Council on Privatization (NCP), they are tasks that could be easily and seamlessly accommodated within these two bureaucracies; with minor adjustment to their legal frameworks without necessarily creating the ICRC. For example, even Mr. President was close to acknowledging the fact that, both BPE and ICRC share some commonalities in their mandates when he stressed that: “It is important to stress that it is the ICRC’s purview to develop the appropriate framework for concessioning and handle all infrastructure projects relating to the grant of concessions, while the Bureau of Public Enterprises (BPE) focuses on privatization of Federal Government assets in line with the Act setting up the Bureau.”

 

This very strong statement is what I consider a near Presidential or Government self-confession to the point I am making with respect to duplication and or replication of organizations as earlier stated by Mr. Erapi in his write up. Presently, I can pin point two typical examples of existing agencies whose functions are duplicates or replicates of each other. These are first, the Department of Petroleum Resources versus the Petroleum Products Pricing and Regulatory Agency (PPPRA) and second, NigComSat Ltd versus GalaxyBB Plc.

 

On the one hand, both DPR and PPPRA are in the business of regulating and deregulating the Nigerian petroleum sector and industry respectively. While on the other hand, both NigComSat Ltd and GalaxyBB Plc are in the business of providing the general public and the three tiers of Nigerian government with ICT and wireless telecoms services. All these four government-owned agencies also profess acting “as the interface with the private sector to promote communication on national PPP policies and programmes” as stressed by Mr. President during the formal inauguration ceremony of the Board of the ICRC.

 

Having made the above observation, I would think what Mr. President needs now is to rectify the existing faulty legal, regulatory and institutional arrangements for implementing the neoliberal economic reform agenda being pushed by the Washington Consensus advocates – i.e. The World Bank and the International Monetary Fund (IMF) and implemented in Nigeria since 1986. For example, there are some missing links which occurred either by commission or omission in the existing neoliberal institutional framework for the implementation of the Washington Consensus reform agenda in Nigeria.

 

One of these missing links is the failure to establish or create Competition Commission and its sister arm, Office of Fair Trade or their variants, as is commonly found in all the advanced capitalist nations we are trying to copy. Interestingly, even a very small underdeveloped nation such as The Gambia has found it necessary to establish a Competition Commission in 2008. Hence, I need not to over emphasize the fact that the existence of these two very important organizations is a necessary condition for any successful operation of a free market, efficiently competitive and reasonably “fair” national spatial neoliberal economy.

 

Again, Mr. President alluded to this fact when in his Speech at the inauguration of the Board of the ICRC, stressed the point that: “In line with our Administration’s commitment to transparency and accountability, the ICRC must ensure that the transfer of responsibility to the private sector is accomplished through strict deregulation and open competition. In other words, the Commission is expected to epitomize best practices in Public Private Partnership (PPP), and be a beacon for sub-national entities to take their bearings from.”

 

I hasten to add that it is the presence of Competition Commission and Fair Trade laws that can guarantee transparency, accountability in a deregulated environment and promote open competition, best practices in PPP and protect the free functioning of those markets that are open to competition.

 

Furthermore, in all nations professing and practicing proper neoliberal economic system, Competition Commissions (or Anti-Trust Commissions as it is known in the Unites States of America), do collaborate with key national regulatory institutions such as Public Utilities Regulatory Commissions like Nigeria’s own BPE, the Nigerian Communication Commission (NCC) and the Nigerian Electricity Regulatory Commission (NERC) amongst others, whose regulatory activities are complementary and mutually reinforcing with those of Competition Commissions.

 

There is no doubt that healthy competition, enables firms to operate effectively, and offers consumers a greater choice of products and services at low prices. Therefore, Competition Commission and Office of Fair Trade are responsible for making markets work well for consumers in neoliberal settings that Nigeria is copying albeit imperfectly.

 

May I therefore suggest that Mr. President should make a rethink and convert the ICRC into the long awaited and desired Competition and Fair Trade Commission (or any suitable name that suits and fits an agency that promotes and protects the free functioning of those markets that are open to competition and fair trade). The present composition of the Board of the ICRC is excellent and can still be retained for that purpose.

 

 

Abubakar Atiku Nuhu-Koko

Wednesday, December 24, 2008

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