Nigeria: Govt to Review Revenue Sharing Formula Over Minimum Wage

Photo: Vanguard
Minimum wage.
18 January 2019

Abuja — The Federal Government yesterday resolved to engage governors of the 36 states of the federation and the Council of State in a review of the nation's federal allocation sharing formula.The review is part of demands by the Nigeria Governors Forum (NGF) prior to its accepting the implementation of the proposed N30,000 National Minimum Wage for Nigerian workers.

Following the National Economic Council (NEC) meeting chaired by Vice President Yemi Osinbajo, it was gathered that if agreed upon, the proposed wage would be taken care of as prescribed by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC).

The NGF had recently sought a new fiscal restructuring plan on the grounds that economic challenges in the states would make payment of the new wage difficult.Although the Minimum Wage Tripartite Committee led by the former Head of Service of the Federation, Ama Pepple, had recommended N30,000, the Federal Government agreed to pay N24,000, while the state governments insisted on N22,500.

A presidency source privy to the closed-door deliberations at yesterday's NEC meeting said the Federal Government has decided to take the governors' request to the Council of State for a definite resolution on the wage crisis.He said: "We are making progress. We will be meeting with the Council of State on Tuesday, January 22. The governors are asking for a review of the revenue sharing formula, and government is looking at that. The Minimum Wage Technical Advisory Committee that was inaugurated recently is looking into the revenue sharing formula."

Asked to be specific on whether the Federal Government has agreed to allocate more resources to state governments, the source said: "Everything is in progress."

Speaking to State House correspondents after the meeting, Minister of Labour and Employment Chris Ngige said NEC discussed the matter and agreed to meet members of the Council of State for a unified position.

President Buhari recently inaugurated an advisory technical committee for the implementation of the proposed wage. The committee, which was given one month to submit its report, will advise the Federal Government on new sources of funds and ways to implement the initiative in a sustainable manner.

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