Minister of State for Petroleum Resources Mr. Ibe Kachikwu has allayed fears over the fate of workers of the Department of Petroleum Resources, DPR, and the Petroleum Products Pricing Regulatory, PPPRA, stating that workers of both agencies will be absorbed into the new petroleum industry regulator to be set up by the Petroleum Industry Governance Bill, PIGB. Speaking at a Round table on understanding the PIGB, organised by the Nigeria Natural Resource Charter, NNRC and the Media Initiative on Transparency in the Extractive Industry, MITEI, Kachikwu said that DPR and the PPPRA will be scrapped and merged into the Petroleum Regulatory Commission, PRC, as stipulated by the Bill.
Kachikwu, who was represented by his Senior Technical Adviser on Policy and Regulation, Mr. Adegbite Adeniji, also stated that it would not be business as usual as key performance indicators, KPI, would be set for the Board, management and other employees, adding that any official found wanting in the discharge in his or duties would be sanctioned and shown the exit.
He said that the scrapping of the DPR and the PPPRA, apart from ensuring that no one is sacked, would provide an opportunity for new persons to be employed into the new entity to be set up, especially as new ideas are sought to fill in gaps that might exist in the company.
He said, “Where they are gaps in the manpower in there, it provides an opportunity for people to be appointed from outside, because again, you want to put in new ideas, fresh legs in the whole process. In that process, you preserve the jobs, and you also attract a pathway for the employment of other skills from outside to help energise the new system you are trying to build.”
Kachikwu said the Board and management of the new regulatory entity would be given the power to hire and fire and also given the authority to set benchmarks with which staff would be measured. He said, “At that time, it has not nothing to do with the minister, it is up to the management to retain their staff afterwards. You then have to make sure you actually meet up to task as far your job is concerned. That is how we dealt with the issue of labour.
“After that, with the mandate that each institution would have for efficiency, people there have to work and display their performance in their jobs. But at the inception, the existing jobs would be there, but then people would then have to rise up to the occasion, because those Boards that would be in those entities would be mandated statutorily to ensure efficiency in the public interest. Therefore, from that point on, you do not have a job for life. You now have to be worth that salary, that money you are paid.” Kachikwu explained that powers would now be given to the management of the entity to ensure they operate efficiently and effectively, to enable them correctly make decisions as to who would meet up with the requirements for their position. He said, “Once the ball gets rolling, the question would now be if I am the manager at the helm of the institution, I would want to see who is effective and who is not. That is now the Key Performance Indicators (KPI) for the Board and for the Chief Executive of the institution, to make sure he runs an effective institution.”
Continuing, the Minister said, “What the PIGB has done is to establish a single regulatory authority. What PPPRA does today is to regulate petroleum products pricing, so it is almost like an economic regulator for the downstream. What the PIGB creates is the Petroleum Regulatory Commission, which now undertakes technical and economic regulation of the upstream, midstream and the downstream.
“It regulates oil, gas and products. It assimilates both DPR and PPPRA, such that those two institutions would no longer exist; a new entity is created from that merger. So there would be no more PPPRA, inasmuch as there would be no more DPR. We would have a new regulator that covers the whole fields. The idea is this, if you are a regulator and you do not have access to all information in the industry, you cannot be effective; which is part of the reasons why our current system is not effective, because they are split among two or three agencies. But when you merge them and you create one and all the different regulatory powers now rest on that entity, then you would now start to have a platform on which to further regulate.”
Kachikwu further explained that the new law is trying to build a more muscular regulator, while he warned that it would be dangerous if competent people were not engaged to run the organisation. He said, “We cannot sacrifice the future of the country on the altar of incompetence. This is where we have to be watchful, so that the hiring process into that entity must be done in a manner that it gives clarity to all that things are been done in national interest. “We are taking the entire petroleum industry into an entity that is statutorily independent, from political interference. The way the Minister can interfere is through policy directions. The policy directives must emanate from published policies. That is say this is the policy of the country and it must be a consistent policy.”
