By: Habeeb Abdul
As is now often the case with reports from that quarter, the National Bureau of Statistics in February revealed disheartening news—headline inflation had risen again. This time, it was up from 28.92 to 29.90 percent, food inflation 35.41% from 33.93 in the previous month. The data keeps getting stacked and much as there are positives, the deluge of depressing figures bite. For the University of Ibadan faction of the grassroots, students, specifically, the situation is a dynamic one i.e. a large troop of young, mostly dependent adults, forced to expend limited resources provided by financially stressed guardians on a rapidly inaccessible pool of consumables.
This context is important as it helps to define the necessity of welfare policies intended to cushion the effects of the inflationary trend. In other words, where the bulk of inhabitants are people who routinely experience resource constraints, worsened by lower purchasing power, attempts should be made to relieve them. It may be contended in the same breath that tertiary education is in itself a financial adventure, one parents or guardians surely must have expected to be demanding. However, the argument still stands. This liberal perception, which also feeds into the mercantilist view of education, fails against the volatility pervading these climes. A sponsor might in truth be psychologically competent at dealing with the scholastic expenses of a ward, but would inevitably be shaken by the geometric increases in prices that obtain now.
The understanding of this very likely feeds into the history of price control attempts in the university. I recall protests against the increase in the prices of swallow at the Lord Tedder Hall cafeteria years ago. Then, residents had been miffed at what is by today’s standards a patently marginal increase in the cost of a single wrap of swallow: 20 or fifty naira. In the past months, price control has taken wider administrative form with the union attempting to kickstart enforcement taskforces across halls of residence. While these are yet to see the light of day in most cases, the feasibility of their job is worth examining regardless.
Were we to adopt the job description of the Kenneth Mellanby Hall Price and Regulatory Committee, being practically the most visible around so far, the price control team would be responsible for the publication of a commodities price list on a monthly basis. Whether that has been done since the resolution was announced in early January is discourse for another day. Notwithstanding, publication of a periodical of that nature would require familiarity with market prices and the conventions that influence them. A price control team should reasonably not work on hearsay, accepting whatever it is that campus vendors relate to them. We can expect that a premier component of their jobs would therefore be onsite interactions with sources within markets.
Through these, they can make informed decisions on price regulation on campus. This in itself is not unfeasible. It is after all a matter of putting boots on the ground and cultivating the necessary networks. Given that there is a wide range of items purchased by students for different purposes, the true difficulty here might be collating them or prioritizing which ones to document in the first place. It becomes more of an uphill task for any price control team when one realizes that there is hardly any item that has been excluded from inflation. Still, that may be resolvable through requests for feedback from members of the public. We are no strangers to online forms requesting this on other salient issues anyways.
But it gets dicier. Vendors naturally patronize different suppliers or wholesalers based on a variety of reasons. Prices from these sources, also influenced by separate reasons even if the margins are negligible, thus birth the landscape of diverse costs among vendors. It goes without saying that certain retailers willfully inflate prices with neither care nor caution, but even then, free market principles remain a pertinent problem for any such committee. The entire idea behind the presence of multiple stores with the same wares is to foster competition. Where one vendor concedes footfall to the next due to whatever circumstances created the uptick in their prices, a theoretical incentive arises to recover by tamping down prices. Except control teams agree to slight differences on a vendor-by-vendor basis, the creation of a single price list terminates this principle.
It potentially also creates an arrangement where vendors are unable to recover the profits due to them based on the unique, individual contexts surrounding supply. Deeper reflection on this enables us to realize that in certain instances, traders secure loans to restock. Their ability to comfortably repay wholesalers (who are quite likely to be potential sources of commodities provided on credit) depend on estimated profits for that period. In other words, control, except implemented on the case-by-case structure recommended earlier (which really might not amount to control at all if students think that the subsistence of price differences makes little sense) could amount to unfairness. Even an agreement to allow certain vendors to retail at prices different from a popularly agreed benchmark could be unworkable for two reasons—the first being the risk of loss on their side when student-buyers opt for stalls with lower prices, and the second, disaffection amongst other vendors who complied with the generic rates.
It might therefore be simpler for committees with a mandate such as this to simply concentrate their energies on a pool of common consumables; bread, soft drinks, sachet water etcetera. Or, to our collective discomfort as consumers, allow the system to run as is with sole focus on things like ambitious charges for POS transactions. The latter option, while not an immediate favorite, still guarantees fairness. It stands to reason that in a climate of control, vendors on campus could potentially enjoy lesser benefits of trade compared to their counterparts off-campus, depending on the level of hawkishness by any committee in any particular hall.
On POS transactions, the duplicity is well documented. While vendors on campus typically rave about the banking costs, it is occasionally a culture shock to this writer when the same does not obtain with traders off it. Different reasons have been attributed for this, the major one being that patrons of traditional banks are often billed on payments into their accounts. Transfer costs are therefore an attempt to avoid deductions from the original price of the sold item on arrival via transfer. At least when one does not consider the inherent denial that operating costs such as transport fares exist and sellers should ordinarily be prepared to deal with them with means other than exorbitant returns on supposed banking costs. Even if that perspective were to be accepted, the fact remains that vendors often consider these fares while deciding how to price their commodities. Combined, it would seem on the surface that a two-factor channel of profiteering was designed through that method. We have equally noted a scenario where vendors resort to the relatively cheaper option of new generation banks but still persist with billing transfers.
So far, the apparent decline in transfer charges seems to be due to both the efforts at price control and the adoption of alternative banks. Whichever one it is, if such polarity exists at all, we can conclude that consumers and retailers are similarly conscious of the price hikes. For committees, the challenge is in striking a balance, curbing extreme divergences, but holding back enough to allow fairness.
