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Minimum wage war


The declaration by the Governors’ Forum on why states may not be able to continue with the N18, 000 minimum wage has set them on a collision course with the organised labour. Tony Akowe in this report takes a look at the looming labour crisis

Another labour crisis may be brewing if state governors have their way and get the rest of the country to acquiesce to their plea to scrap the N18, 000 national minimum wage.

Of course, the reason the state governors mooted for their decision to seek a downward review of the minimum wage is due to the dwindling oil receipts.

However, a cross-section of experts and analysts while ventilating their views on the purported plan to end the minimum wage, argued that a downward review at this point in time is calling for prolonged strike action which will no doubt cripple activities across the federation.

“Even though many of the states have had to rely on a bailout fund from the federal government to pay salaries of workers, some of who are still yet to be paid, it is evident that the governors are not ready to improve on their internally generated revenue, but to go cap in hand every month to the federations account for hand outs to administer their states,” one of the analysts stressed.

Mixed feelings over wage review

Chairman of the Nigeria Governors Forum and Zamfara state governor, Abdulaziz Yari announced that due to the current state of the economy and the slide in prices of oil in the international market, they will not be able to continue the payment of the minimum wage.

He said: “We resolved that we must look at ways to enhance revenue generation and at the same time look at ways to cut our overhead costs more especially the political office holders’ salaries and other overhead expenses. The situation is no longer the same when we were asked to pay N18,000 minimum wage, when oil price was $126 (per barrel) and continued paying N18,000 minimum wage when the oil is $41 and the source of government expenditure is from oil, and we have not seen prospects in the oil industry in the near future. We will diversify our economy in the area of agriculture and mining.

“But at the same time, we should understand our situation where some of us (states) today are taking N100million take home  (monthly allocation) and then have salaries in particular of over N2billion to pay. We therefore agreed here to take this suggestion to NEC in our meeting.”

The current national minimum wage which organised labour say is due for an upward review was a product of a long drawn battle between workers and government.

Edo state governor, Comrade Adams Oshiomhole who was part of the negotiation believes that it was out of place for any of the governors to question the wisdom behind the payment of the N18,000 minimum wage to workers.

While some of the governors who claimed that they cannot pay the minimum wage argued that it was imposed on them by the federal government, Oshiomhole said it was not imposed on the government but rather it was a product of agreement between government and labour.

Oshiomhole who is a former President of the NLC, said at a meeting of labour leaders in Abuja that democracy must not be run at the convenience of state governors.

Apparently siding with his old constituency, the diminutive governor said: “I’m a labour man, I have been clear with my colleagues in seeking to find solution to the problem we face. We have to be holistic. We cannot at one hand question the wisdom behind the national minimum wage. I joined the NLC to protest to the National Assembly when they were going to amend the constitution to make the minimum wage a concurrent issue. I said workers have a stake in this democracy. They are the ones who could afford to march the streets and they march the streets for democracy.”

For better emphasis, he said: “Democracy doesn’t have to run at the comfort or convenience of governors, ministers, and presidents. I believe that the issue in the economy hasn’t got to do with minimum wage. I have always also reminded my colleagues that the minimum wage was not imposed, it was negotiated and state governments agreed to it, the president signed it not under duress, there was no strike to compel the then president to sign it, he signed it voluntarily.”

“I believe when you look at the minimum wage, as it is today at N18,000, it is less than 100 dollars. I think it is now about eighty dollars. Now, divide eighty dollars by 31 days, you will be getting about two point something dollars. Now we cannot argue that workers in Nigeria formal sector should not earn more than two dollars a day, I cannot subscribe to that because the heart of governance is the welfare of the people.”

Expectedly, the NLC President, Ayuba Wabba who was furious about the claim by the governors gave an indication that the workers will shut down the states if the governors attempt to reduce workers salaries, arguing that the N18,000 which the governors are claiming they cannot pay, is not enough to take the Nigerian worker home at the end of every month.

He said “we reject in its entirety, Nigerian workers will not take it lightly. We are not the problem, rather we are the solution. The problem is that they have not been able to reduce the cost of governance. They should go and reduce their security votes. Let them also cut down on the number of their entourages. They must also be accountable to the citizens that voted them into power. “We are going to resist any attempt to tamper with the payment under any guise. Let them also note that the N18,000 was not allocated, it was negotiated through a tripartite process and it is a product of law that is even due for review. We are going to champion the review. Let us also put them on notice, if attempt is made to reduce, review or do anything outside the legal minimum of N18,000, which cannot even take us home, we are going to resist it. Nigerian workers will be mobilise to resist.”

His counterpart at the Trade Union Congress of Nigeria, Boboi Kaigama also shared the same sentiments.

Like Oshiomhole, Kaigama explained that the N18,000 minimum wage was agreed at a tripartite meeting involving government at all levels, employers through Nigeria’s Employers’ Consultative Association (NECA) and the organised labour.

According to the TUC President, “We are not only disappointed but also we fear for our future as responsible citizens of the country because we are daily confronted with policy summersaults as development strategies. To start with, we had thought that the very essence of setting up the Governors’ Forum is for them to meet once in awhile to discuss vital issues on how to move the country forward little did we know that we are absolutely wrong. “For issues like reduction of national minimum wage and sack of workers to be discussed at what is supposed to be a high profile meeting sends a wrong signal. We are disappointed that governors who preached love, peace and progress for all few months ago are now singing in a different tune. They have suddenly realised they can no longer pay $90 a month, which suggests to us that they are asking for a merger. How can they not pay N18, 000 but they can have a 10- car convoy, six for wife, pay themselves ridiculous pension and severance pay, have houses in Abuja, Lagos, Dubai, London, USA; send their children to primary schools in London and stash millions of pounds in their mansions. This is heartless and barbaric! We are disappointed because we had expected the Governors’ Forum to be angling about true fiscal federalism and how to harness the resources nature has bequeathed to every state. We have always made it known that the cost of governance is high, especially as every state depends on federal government’s monthly allocation. Why should the innocent pay for the looting and stealing of our leaders. If they cut down salaries, how do they want business to flourish when the purchasing power is already very low? It appears all the hype on “anti -corruption” is hereby laid to rest, as workers must now steal to survive.”

One would have thought that the governors will think out of the box to explore the possibility of increasing Internally Generated Revenue (IGR) through exploration of resources, albeit abundant ones in their vicinity to improve their state resources.

The governors announced at the end of their meeting under the auspices of the Nigeria Governors’ Forum that due to the state of the economy, they were no longer in a position to pay the minimum wage to their workers.

Reacting to the claims by the governors, a nongovernmental organisation, Coalition Against Corrupt Leaders (CACOL), accuse the governors of trying to increase the unemployment and poverty level in the country.

The group’s Chairman, Debo Adeniran believes that such an action will result in large scale corruption in the public sector and lead to an increase in crime.

He said the state governors should as a matter of priority, declare economic emergency in their states in order to remove unnecessary and irrelevant projects affecting wages in their respective states and not use the state of the nation’s economy as an excuse for reducing the minimum wage or downsizing their workforce.

He said further that “even with the N18, 000 minimum wage, the salary of most average Nigerian workers cannot satisfy their immediate needs and which should not be so.”

The states should also look inwards and find ways to harness the abundant human and natural resources that every state is blessed with. They should also endeavour to cut down on basic running costs and put a check on corruption and other practices that impact of their finance. It has often been said that the dependent on oil revenue is inimical to the economic growth of the country. Non-oil sectors of the economy should be harnessed.”

Ango Abdullahi, a Professor of Agriculture and former Presidential Adviser on food Security believe that governors who cannot pay the minimum wage owe Nigerian workers an apology.

While describing the claims as irresponsible, insensitive, embarrassing and unacceptable to Nigerians given the huge amount they and their retinue of aides pocket monthly, the former Ahmadu Bello University Vice Chancellor was quoted as saying that it was a thing of displeasure that governors, who were taking billions of Naira monthly under the guise of security votes, which they don’t account for, could wickedly refuse to pay their workers a worthless minimum wage of N18,000 monthly.

Findings revealed that during the negotiation for the current minimum wage, some of the state governors had offered to pay far more than the N18,000 while others offered far less.

It was learnt that Abia State under Theodore Orji  for example offered to pay N46,700, Kebbi State under Saidu Dankigari proposed  to pay N30,000, Imo state under Governor Ikedi Ohakim proposed N30,000 and Kwara state under Senator Bukola Saraki now Senate President proposed to pay N30,000.

Also, Bauchi State under Isa Yuguda accepted to pay N16,585.50, the Federal Capital Territory proposed N25,000, Zamfara proposed to pay N15,000, Jigawa proposed to pay N20,800, Plateau proposed to pay N10,000, Anambra  N25,000 while Ebonyi proposed to pay N10,000. Akwa Ibom State proposed to pay N13,333.12 and  Kano State N11,022.17. This, however was before the tripartite committee agreed on N18,000 as the national minimum wage.

Analysts believe that the over dependent on oil revenue and massive corruption in the system is affecting the ability of the states to pay living wages to workers. Investigations revealed that many of the states cannot generate enough revenue to augment what they receive from the federations account.

At the recently concluded 21st Nigeria Economic Summit, participants agreed on the need to look inward and improve on their internal revenue, while blocking leakages in the system.

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