Last
Monday, November 27, 2017, President Muhammadu Buhari inaugurated a
30-member tripartite National Minimum Wage Committee for the negotiation
of a new National Minimum Wage for Nigerian workers. The inauguration
held inside the Council Chamber of the Presidential Villa, Abuja, had in
attendance governors and senior government officials. Some All
Progressives Congress governors, Rochas Okorocha of Imo, Rauf Aregbesola
of Osun, Atiku Bagudu of Kebbi and Simon Lalong of Plateau as well as
the Peoples Democratic Party’s Nyesom Wike of Rivers and Ibrahim
Dankwambo of Gombe, are members of the committee.
The
President said the inauguration of the committee followed the
recommendation of a technical committee put in place after the increase
in the price of petrol in 2016. He also said the current minimum wage
being used in the country had already expired. (It was supposed to be
reviewed every five years). After the completion of the work of the
committee, an executive bill would be sent to the National Assembly “to
undergo scrutiny before being passed into law”.
By
its tripartite nature, the committee is made up of persons from the
public sector, (federal and state governments) and the private sector
made up of the Nigerian Employers’ Consultative Association,
Manufacturers Association of Nigeria, Nigerian Association of Chambers
of Commerce, Industry, Mines and Agriculture and Nigerian Association of
Small and Medium Enterprises. The committee has a former Head of
Service and Minister of Housing, Ama Pepple, as chairperson, while the
Minister of Labour and Employment, Chris Ngige, will serve as deputy
chairman. The Chairman, National Salaries, Income and Wages Commission,
Richard Egbule, will serve as the secretary of the committee.
Other
members of the committee are Udoma Udo-Udoma, Minister, Budget and
National Planning; Kemi Adeosun, Minister of Finance; Winifred Oyo-Ita,
Head of the Civil Service of the Federation; and Roy Ugo, the Permanent
Secretary, General Services, Office of the Secretary to the Government
of the Federation. The Director-General of Nigerian Governors’ Forum,
Asishana Okauru, will serve as an observer. On the trade union side are
the President, Nigeria Labour Congress, Ayuba Wabba, who leads a team
comprising Peters Adeyemi, Kiri Mohammed, Amaechi Asugwuni and Peter
Ozo-Eson. The Trade Union Congress is led by its President, Bobboi
Kaigama, and other members including Sunday Salako
and Alade Lawal. The President, Nigerian Union of Petroleum and Natural
Gas Workers, Igwe Achese, is also a member. On the employers’ side are
Olusegun Oshinowo, Director General, Nigeria Employers’ Consultative
Association, as well as Timothy Olawale and Chuma Nwankwo. The Director
General, Federation of Construction Industry, Olubunmi Adekoje;
Chairman, Kaduna East Branch, Manufacturers’ Association of Nigeria,
Ahmed Gobir; and Francis Oluwagbenro also from MAN are members.
It
is important to understand how the issue of the national minimum wage
came about. Nigeria joined the league of International Labour
Organisation member countries that set minimum wage for their workers in
1981. The last time a minimum wage was set before the current one being
reviewed was in 2000 with effect from May 1, 2001. Then, the wage was
set at a paltry N5,500. It took 10 years to have this benchmark reviewed
through a collective bargaining mechanism. The NLC said the union made a
demand for wage increase in 2009 after a thorough study of the salaries
of political office holders’ pre-and post-consolidation, as well as a
careful examination of the minimum annual wage levels in African
countries. The study showed that Nigerian workers were among the least
remunerated in the world. In the NLC’s estimated cost of meeting basic
needs for a representative family done in February 2009, a sum total of
N58,500 was arrived at. The NLC however decided to demand a new national
minimum wage of N52,200 which the union considered approximate least
Minimum Annual Wage levels in African countries, the minimum cost of
providing basic needs for the worker and their immediate family and the
cost of living data.
In
order to negotiate this request from the NLC and the TUC, the Federal
Government set up a tripartite committee made up of representatives from
the government, labour and the organised private sector. On the part of
the government were four cabinet ministers, three state governors and a
representative of the National Salaries, Incomes and Wages Commission.
Labour drew its representatives from the NLC and the TUC, while
representatives of the organised private sector include NECA and those
of NACCIMA. The committee was chaired by former Chief Justice of
Nigeria, Hon. Justice Alfa Belgore (retd.).
Information
has it that this committee met for over one year, discussing and
negotiating with different stakeholders. It was reliably gathered that
all the 36 state governors as well as the NGF were formally written to
make input into the negotiation. While some of the governors were said
to have recommended a minimum wage of about N20,000 and above, the
committee decided to propose N18,000 in order to make it easy for all
concerned employers of labour to implement. It was also proposed that
the new wage will apply only to organisations with a minimum of 50
workers in their employment. It was after this consensual agreement that
the proposal was drafted into a bill and presented to the National
Assembly for passage. This bill was passed and signed into law by former
President Goodluck Jonathan on March 23, 2011.
That
was the update from the last exercise. Now, Nigerian workers are
demanding N56, 000 new minimum wage. Is that realisable given the
current comatose economy where the extant N18, 000 minimum wage is not
paid as and when due? The last exercise took about two years to
conclude. How long will the current effort take before a new minimum
wage comes into force? Is there a genuine intention on the part of the
current administration to upwardly review the workers’ minimum wage? If
yes, why did it take the Federal Government almost two years after the
astronomic increment in the pump price of petrol as well at the
expiration of the last minimum wage before the new review committee was
inaugurated? Is wage increase the solution to workers’ plight in
Nigeria?
There
is no gainsaying that with the astronomic rise in the cost of living,
Nigerian workers are right to demand wage increase. However, this may
ultimately be counterproductive. If not carefully handled, it will lead
to spiral inflation and low purchasing power. Even without increase in
workers’ pay, the cost of food, housing, education and other essential
services are increasing. This will worsen with a publicised wage
increase. Furthermore, with about two-thirds of states and most of the
local governments not being able to pay the current N18,000 minimum
wage, what assurances are there that they will honour a new wage
increase agreement? In July 2011, the governors gave two preconditions
for them to pay the new wage increase. These are: Review of the current
revenue allocation formula in favour of the states and the removal of
subsidy on petrol. Only one out of these two conditions was met. Even at
that, since 2015, they have collected bailouts and Paris Club refunds
in excess of N2tn, yet many of them are still unable to pay the N18,000
minimum wage.
Can
the Federal Government initiate moves to review the revenue allocation
formula in favour of states to enable them pay the proposed new minimum
wage? If the government at all levels will fix the infrastructural gap
through the provision of low cost housing, good road network, quality
and affordable education and health services, agrarian revolution that
will bring down the cost of foods, improved and affordable electricity
supply and other essential social amenities, these will help reduce the
cost of living and improve the standard of living of Nigerians generally
and workers in particular. Thus, irrespective of their small wage, the
purchasing power will be high and they will be able to live decent
lives. Will Buhari deliver on the new minimum wage before 2019? That is
doubtful, very unlikely!
Source: Punch news
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