Nigeria: Minimum Wage - Our Situation Is Precarious, Governors Tell Buhari

20 November 2018

Abuja — Representatives of Nigeria Governors' Forum (NGF) yesterday met with President Muhammadu Buhari to discuss the lingering issue of national minimum wage, telling the president that states are too financially weak to pay the N30,000 recommended by the National Minimum Wage Committee.

Following the committee's recommendation, which was submitted to the president on November 6, 2018, governors had complained that the figure was unsustainable as most states were still unable to pay the prevailing N18,000.

But organised labour insisted that it was N30,000 or nothing and warned of dire consequences of any move to lower the figure, forcing the governors to set up a committee to put together their case for the attention of the president.

It was the governors' committee, comprising governors of Lagos, Kebbi, Plateau, Bauchi, Akwa Ibom, Ebonyi, Enugu, Kaduna and Zamfara States that met the president behind closed-door yesterday to explain their position to him.

The governors said this was necessary in order to let the president understand their stance, since their input was not contained in the minimum wage committee report.

Although no official statement was made after the meeting, THISDAY gathered that the governors told the president that the finances of the states were so precarious that none of them would on the long run be able to sustain the N30,000 organised labour is insisting on.

The governors, according to impeccable THISDAY sources, presented the books of 12 states; two per geo-political zone, to the president to support their claim of incapacity to pay.

They reportedly argued that even states like Lagos and Rivers that seem able to shoulder the fresh figure could not sustain it as the resultant increase in wage bill would burden them.

They cited Lagos State, which currently has N7billion wage and N2billion pension bills, pointing out that this would shift from N9billion to N15billion per month if the N30,000 is forced on states.

"This would be crippling," the governors reportedly told the president.

They warned that two-thirds of the 36 states would go bankrupt if they are forced to pay the new proposed figure.

Pressing their case further, they gave the president some statistics, "When the minimum wage negotiation started in November 2017, the average total monthly allocation to states was N800 billion. By the end of negotiations in November, 2018 the allocation had shrunk to N600 billion."

Clearly, they told the president that the resources to foot the proposed figure are simply not there.

They, therefore, appealed to the president not accept the figure proposed by the minimum wage committee.

The governors, THISDAY sources said, told the president that there were only two ways the new figure could be afforded: retrenchment or increase in federal allocation to states through the alteration of revenue allocation formula in their favour.

They warned that the retrenchment option would injure the president politically as it would make his pledge of creating three million jobs annually unrealisable.

This, they told the president, is certainly not what he would want in an election season.

In any case, they reportedly argued, the federal government too, is barely able to pay the prevailing N18,000 pay cheque, contending that it had been doing so through loans and bonds.

The president was said to have told the governor that he would study their case and get back to them.

See What Everyone is Watching

More From: This Day

Don't Miss

AllAfrica publishes around 700 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.