Waste Managers Call for Cost Reflective Tariff for Sustainability

The Association of Waste Managers of Nigeria (AWAMN) has called on the government to implement cost reflective tariff for business sustainability.

Mr Olugbenga Adebola, President, AWAMN, told the News Agency of Nigeria (NAN) in Lagos on Tuesday that  cost recovery is sine qua non to the preservation of any business. 

Adebola said that effective and efficient waste management cannot be achieved without cost reflective tariff, adding that any business that is not charging cost reflective tariff will die a natural death. 

“That is why the telecommunication   companies of this world, DSTV, even the GENCO’s of this world are charging cost reflective tariff. 

“The GENCO’s run a system of regular increment in the service charge based on the exchange rate and  the prevailing rate of inflation in the country

“This is not what is obtainable in the waste management sector. 

“How can we recover the cost with the present system of tariff that is not cost reflective. What role is the government going to play because there will always be subsidy. 

“Infact, there is subsidy all over the world. They say that the rich subsidises the poor. that happens with cost recovery within the waste management industry,” Adebola said.

The AWAMN president noted that the last time an increment was done in the low, low area was in 2022 and the price of diesel then was just N600  per litre.

He added that diesel jumped from that amount to N1700.

“Thank God for the intervention of Dangote refinery, it came down to 1 500  and then N1300 per liter and that is where we are. 

“Yet there has not been any single increment on what is chargeable for waste services. 

“Every activity or every operation within the waste management value chain is dollarised. The truck that is going to be brought in is going to be calculated under the current exchange rate,” Adebola said.

He explained that AWAMN, as an association, already had a Memorandum of Understanding (MoU) to bring in over  50 million euros to fund infrastructure.

 “To support effective and efficient waste management, waste treatment, recycling and all that , including the purchase of trucks for effective and efficient waste collection.

“Transportation and disposal, including segregation and recycling, practicing circular economy. 

“But you  know the problem, it is the same cost recovery issue. 

“If you are not able to recover a reasonable cost , how are you going to pay back such a loan.

“Till now, what is chargeable within the waste management industry is not cost reflective tariff, Adebola said.

He said that the subsidies given to the operators, considering their numbers, does not translate much in terms of naira and kobo.

“Some will get N200, 000, N300, 000,  N400,000 and N500, 000,  depending on the area of operation; and I tell you, this cannot take you home to anywhere. For example, one single tire will go for N400, 000 when you have problems.

“In 2023, we did an analysis of what it costs to run a a single waste truck on the streets of Lagos.

“We took into cognisance the cost of diesel, the cost of labour, the cost of wear and tear, the cost of all other hydraulics and what have you.

“At that time the cost of diesel was N1200. For any single truck you see on the road to do one trip, you need an average of N167, 000, N170, 000 to N180,000.

” Can somebody guarantee that the money collected to load one truck is up to 

N150, 000, it is not. Sometimes it is not up to N70, 000;  but the cost of operations has gone up to N170, 000. 

“These are issues; tenements must pay,” Adebola said.