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Minimum Wage And The Revenue Debate (I1)

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The N18,000.00 minimum wage and revenue debate has assumed many colours and shapes following the delay in implementing the national wage law which has become binding on the public sector and private organisations employing 50 or more workers.

The state governors led by Rt. Hon. Chibuike Rotimi Amaechi of Rivers State have continued to argue that with the present revenue allocation formula in which the federal government takes 52.68 percent of the centrally-collected revenues in the distributable pool account leaving the states and local government councils with only 26.72 per cent and 20.60 per cent respectively, they would not be able to pay the N18,000.00 minimum wage and meet the critical developmental challenges of their states.

Thus they are asking for a review of the revenue allocation formula that would give the federal government, states, and local government councils 35 per cent, 42 per cent, and 23 per cent of the centrally-collected revenues respectively. They are also asking for the removal of fuel subsidy which reportedly consumes over N693 billion annually from the federation account.

On the other hand, the Nigeria Labour Congress argues that the states have enough resources to implement the Minimum Wage Act which was signed by President Goodluck Jonathan in March. To the labour union, if the state governments cut down on their huge and excessive expenses on governance, they would have enough money to pay the wage and fulfil their socio-economic obligations to the people. The union posits that payment of the minimum wage is not debatable considering that it was agreed by the government, the organised labour, and the other stakeholders. In fact the labour union has urged the state governments to pay the minimum wage which implementation date was April 1 without further delay in order not to accumulate too much arrears.

From media reports, some well-meaning Nigerians have also lent their voices to the debate. They include Professor Solomon Akinboye, Head of Department, Political Science, University of Lagos, Prof. Itse Sagay (SAN), and Alhaji Hamman Tukur, a former chairman of the Revenue Mobilisation, Allocation, and Fiscal Commission (RMAFC). According to Prof. Akinboye, the problem with Nigeria is that of inability to manage its resources very well. He feels that the revenue allocated to the states from the federal distributable pool account should be increased to enable them (states) meet their financial needs.

Prof. Sagay, on his part, supports the labour union that the state governors must pay the N18,000 minimum wage. To him: “They (State governors) have no choice in this matter. It is high time Nigerians, particularly the political elite began to distinguish between when they have discretion, and when they are compelled. On this matter, they are compelled to pay. It is a legal issue and they must adhere to it.”

In his own contribution to the debate, Alhaji Tukur argues that in view of the money that comes into the Federation Account, the states can pay the N18,000.00 minimum wage without removing the subsidy on fuel. In his words: “The money they (governors) get from the Federation Account alone is enough to pay workers. It is unfortunate that the burden is being passed on to the ordinary man.

“There is enough resources in the country for all. The problem is that the federal and state laws clash. The federal law cannot impose on the state what to do with the money they get from the federation account.  Also, the state cannot impose on the local government what to do with their money. The laws are there and the fact remains that the governors can pay the new wage”.

In the final analysis, the minimum wage and revenue debate shows the pervasive nature of the social, economic, and political problems of the country. Though compared with such old federations as the United States of America (USA), Australia, and Canada, Nigeria is still a fledgling federal nation, it is old enough to have settled its basic socio-economic and political framework.

Since 1946 when the problem of revenue allocation began in Nigeria following a change in the country’s constitution from unitary to a federal one several ad hoc commissions or committees on revenue allocation have been established. They include the Philipson Commission (1946), Hicks – Philipson Commission (1951), Chick Commission (1953), and Raisman Commission (1958). Others are Binns Commission (1964), Dina Interim Revenue Allocation Review Committee (1968), Aboyade Technical Committee on Revenue Allocation (1977), and the Okigbo Commission that was appointed in 1979 to review the existing system of revenue allocation with respect to such factors as national interest, derivation, population, even development and equitable distribution, and equality of state.

Nigeria has also had a long history of grants by which the national government remitted to the federating units funds outside their statutory allocations to assist them perform their social and economic functions. But because of the uncertainty surrounding these grants, the irregularity in their disbursements, the vagaries of their timing, and the frequency and sometimes the sudden change in the federal government’s priorities, the practice of grants has not been used as an effective system of rescuing the states from the problems of resource constraints in respect of meeting their constitutionally  determined obligations.

Another problem associated with the minimum wage and revenue allocation quagmire is the over reliance of the states on the distributable pool. As  B.O. Nwabueze noted in his book Federalism in Nigeria Under the Presidential Constitution, “Federally-collected revenue is the mainstay of the finances of the state governments, accounting for a little over 90 per cent of their total revenue. Upon this revenue, therefore depends the ability of the state governments to maintain their services; to pay their staff, pay for essential supplies and execute their capital projects. Their financial viabilities and credibility as autonomous government units hang upon it. As far as they are concerned, the motivation for its sharing is understandably one of self-survival.

For them, the sharing is almost like a matter of life and death, exciting their deepest concern and their strongest emotions. Hence the intensity of the question concerning it.”

So until Nigeria runs a true federal system in which the national and state governments stand to each other in a relation of meaningful independence and balanced division of powers and resources sufficient to support the structure, issues such as payment of minimum wage and revenue sharing will continue to generate national debate, political pressures and even inter-regional struggles for the national wealth.

As things stand now, the state governments, local government councils and other  public and private organisations with 50 or more workers on their payroll must rise to the challenge of paying the N18,000.00 minimum wage for the law of the land must be respected.

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Opinion

Jumping The Gun

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It is a cheering news, to wit: “Nigeria Set To Begin Export Of Vehicle Parts, Heavy-Duty Metals” – ref. The Tide: Wednesday, Sept. 8, 2021. Zeetin, a Nigerian precision engineering company, whose Managing Director is Azibaola Robert, told Nigerians that his company signed an export Memorandum of Understanding with a Turkish-American Company, JMT Ltd, to export Zeetin’s products to other countries. Robert told us that: “this is the first time a Nigerian engineering and manufacturing company will start exporting heavy-duty metal products, spares to the international market”.
Any patriotic Nigerian would be glad to hear such news, rather than something saddening such as acts of banditry and brigandage. With the export of Zeetin vehicle parts and heavy-duty metals, “overall, Nigeria will be the ultimate beneficiary”. Hopefully, JMT Limited, while taking the responsibility of exporting and marketing Zeetin products, would have satisfied itself that the products are of international standards. It would not be enough for a precision engineering company to manufacture products, but there is also an additional responsibility of quality assurance.
Manufacturers Association of Nigeria (MAN) would obviously have satisfied itself that Zeetin products are of international standards. Therefore, credit must go to an indigenous Zeetin precision engineering company for being the first to export heavy-duty metal products and we hope that it would be a proud beginning; not Ajaokuta Steel!
Common stages involved in every project, including precision engineering works, would cover risk analysis, project design, implementation and then monitoring and evaluation. Purposes of monitoring and evaluation include getting factual and comprehensive feedback with regards to the performance of products sent out into the market. For manufacturing companies, lots of resources are spent on the feedback process, to ensure customer satisfaction and product sustainability. Complaints from customers and users are taken seriously so that corrections and improvements can be made.
At a seminar in the School of Oriental and African Studies, London, a long time ago, some useful facts emerged with regards to the common reactions of developing countries, to criticisms. Monitoring and evaluation process would obviously involve pointing out lapses calling for correction and improved strengthening. The emphasis was that criticism should not be seen as acts of aggression or hostility, but as opportunity for corrections and improvements. It takes maturity and a big heart to learn from scathing criticism.
With regards to product quality, developing countries, including Nigeria, have been known to have some lingering lapses, despite improved diligence. When there were talks in the recent times about Nigeria going to manufacture cars and aircraft, a former Nigerian diplomat swore that he, nor any of his grand children, would travel by such vehicle. Be it a joke or reality, his remark represents the attitude of many Nigerians towards local products. It is not always a question of ability or absence of it, but something else, quality included.
At the aforementioned seminar in the London school, there was a comment about “jumping the gun”, being a reference to an attitude of setting out long before the dawn. There is usually a difference between having an ability, and having the readiness to apply it, at the most appropriate time. Jumping the gun would mean embarking on a mission before one is ready enough to do so. Such haste may arise from vanity or some other weakness. It may not be wrong to take some risks or announce some breakthrough, but let it not be for “show” purposes.
In the management of development process, what is known as felt-need theory includes the practice of addressing needs and necessities according to the order of priority. Priority rating of a need would include the level of threat posed and the number of people involved. Commonsense understanding and assessment of a priority would mean “doing first thing first”. As First-Aid instructors would say. If threat to life is involved, then life-saving measures would be more appropriate priority than spending time in arguments while situation gets worse. You don’t go after rats while a house is on fire!
There was a time, a few years ago, when products packaged and exported from Nigeria were rejected abroad on the ground of not meeting international standards. Such products were not vehicle parts or heavy-duty metals. A major complaint about Nigerian-made products has always pointed towards “finishing and packaging”, which carry the tag of “poorly done”. There have been complaints that Nigerians rarely take serious pains to give a “good finishing” to what they produce. Products carry signatures of their origins and producers!
The endeavours and exploits of Zeetin have been used in this article as a means to examine what real progress means. That there are differences among individuals, nations, cultures and races, count as blessings and assets, rather than liabilities. Real progress shows in the development and advancement of what is indigenous to a people, rather than in copying and adopting foreign things, including engineering technology. Such progress begins with development of a right sense of beauty, not as a caricature but as an infallible signpost for knowing what exhibits harmony and creates joy. Beauty, Harmony, Joy!
People often strive in vain, and motivated by vanity, to copy and adopt what is not indigenous to their culture. Much time and resources are spent on wanting to follow the train of fashion, while efforts are rarely made to identify and develop indigenous talents. Obviously, every distinct group of people have unique endowments, peculiar to them, serving as their contribution to collective humanity. Harmony arises where differences in kind give their best to build up the whole through complementarily. Wherever one endeavour complements another, harmony arises.
Rather than be rooted in our native soil, culture and peculiar endowments, we copy and reproduce what is alien and borrowed from those we consider better. Such lifestyle of imitation is a major drawback for Nigeria. We progress better by being rooted in what we truly are and then build up from the grassroots; not by borrowing, copying or imitating what others had developed. From engineering works, to governance and health issues, there are indigenous and local content components that can give added values, if we Don’t Jump the Gun.

Dr Amirize is a retired lecturer from the Rivers State University, Port Harcourt.

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Cursory Look At Nigeria’s Challenges

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Insecurity and bad economy in Nigeria have reached alarming proportions rearing their ugly heads in various facets of our national life. Lives are lost on daily basis, population depleted, businesses in comatose, investment are nose-diving, multinationals closing shop and vacating the country, unemployment soaring and the populace in fear.
On May 29, 2015, General Muhammadu Buhari (rtd) was sworn in as President of Nigeria. The administration promised to urgently tackle several challenges that have hindered economic prosperity, sustainable security and overall national development in Nigeria. In terms of human resources, Nigeria is among the first 20 developed countries of the world. It is Africa’s largest oil-producing country. With a population of over 200 million, it is, no doubt, the largest market in Africa.
But the security and economic fortunes have been dwindling due to vagaries in the global price of crude oil. The country has been caught in-between affluence and affliction. Nigeria’s political leadership is a major factor why she has been reduced to a giant with clay feet. Buhari came to national limelight in 1983 when he became military Head of State after a successful coup d’état that overthrew civilian President Shehu Shagari on December 31, 1983. He ruled Nigeria from January 1984 until August 1985, before his regime was also toppled by another coup. His reign is ever remembered for a vigorous anti-corruption war, but tainted by human rights abuses.
Buhari contested in the presidential elections of 2003, 2007 and 2011, but lost to the Peoples Democratic Party (PDP) candidates. In the 2003, he was the presidential candidate of the All Nigeria Peoples Party (ANPP) and lost to incumbent President Olusegun Obasanjo. In 2007, he contested again on the ticket of the same party, but was beaten by PDP’s Umaru Yar’Adua who scored 26,638,063 against Buhari’s 6,605,299. In March 2010, the retired General left ANPP and formed the Congress for Progressive Change (CPC) contesting as its presidential candidate during the 2011 presidential poll, which he lost to President Goodluck Jonathan of PDP.
In that election, Buhari secured 12,214,853 votes against the President Goodluck Jonathan’s who secured 22,495,187. In 2014, the All Progressives Congress (APC) nominated Buhari to stand as its presidential candidate in the 2015 presidential election. The APC was merger of the All Progressives Grand Alliance (APGA), Action Congress of Nigeria (ACN), ANPP and CPC.
Buhari subsequently emerged victorious in the March 28, 2015 poll, defeating incumbent President Jonathan of PDP. He polled 15,416,221 votes against Jonathan’s 12,853,162 votes in an election that was keenly contested. On May 29, 2015, General Muhammadu Buhari was sworn in as president. Having ascended to the office he once occupied as a military officer, his administration was expected to urgently tackle several challenges that have bedeviled Nigeria over the last three decades. Insecurity, bad economy and corruption were the greatest challenges facing the new administrations since the return to democracy in 1999.
Traditional security threats such as violent conflicts, militancy, armed robbery and kidnapping have assumed worrisome dimensions in Nigeria. Evolving threats such as insurgency and terrorism have further complicated the situation. Outbreak of violent conflicts has become a major characteristic of insecurity in Nigeria. It is estimated that Nigeria has witnessed over 3,000 violent ethno-religious, communal and political conflicts of varying intensity and magnitude. Clashes between farmers and pastoralists have resulted in the death of about 4,732 persons between 1998 and 2014. The spate of violent crimes has become alarming.
In all of this the Presidency appears not to be doing enough, raising suspicions that Buhari is reluctant to take action since the herdsmen are mainly of his Fulani tribe. Even the swiftness with which Aso Rock Villa reacts to any condemnation of destructions caused by herders in the Middle Belt and southern parts of the country helps to fuel this suspicion.
Of course, the President’s insistence to recover gazetted grazing routes in the country lends further credence to the arguments of those who have maintained that he is deliberately keeping quiet and allowing his herder kinsmen to ride roughshod over every other section of the country. At best, all Buhari had ever ventured was that those who had complained about the destructions caused by open grazing should learn to tolerate the migrant herders and their cattle.
And on the economic front, the Buhari administration has a myriad of challenges to tackle which include but not limited to pervasive poverty, rising unemployment, epileptic power supply, fuel crisis and declining economy. Pervasive poverty and massive unemployment are serious economic challenges facing Nigeria. Both have maintained a rising trend over the years. Poverty rates remain high in Nigeria, particularly in rural areas. It is estimated that 101million out of Nigeria’s population of about 200 million live in extreme poverty.
And of the 99 million Nigerians suffering from extreme poverty, most are young people denied employment opportunities. However, as of 2015, the unemployment rate in Nigeria reached an all-time high of 20 percent with a youth unemployment rate as high as 50 per cent. These young Nigerians fell prey to recruitment by such groups as Boko Haram.
The problem of poverty and unemployment in Nigeria results from inconsistent policies, misappropriation of funds meant for empowerment schemes and increasing de-industrialisation and collapse of small businesses due to lack of venture capital and poor power supply.
Foreign industrial firms that once operated in this country have since relocated to other African countries like Ghana and South Africa which can boast of better operating environments. The oil multinationals that not only employed Nigerians and paid them very well have also relocated their key operations to offshore platforms in order to escape the increasingly restive Nigerian youth. This has led to staff downsizing across companies.
Achugo wrote from Eastern Polytechnic, Port Harcourt.

By: Godstime Achugo

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Opinion

Avoiding Brain-Drain In Medicare

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The industrial action embarked upon by resident doctors in Nigeria has lasted for several weeks. A few months ago, the Nigerian Medical Association (NMA) was alleged to be demanding certain allowances, including that of COVID-19 inducement allowance.
The Federal Minister of Labour and Productivity, Dr Chris Ngige, the NMA and other stakeholders shifted grounds on the issues and came to a resolution which made them go back to work. This time around, the authorities concerned should also come together, sort out the problems concerning the medical practitioners so that the nation’s healthcare system is taken care of.
There is the fear that if they are not treated well, some of them may travel abroad for greener pastures. A situation where well-trained medical doctors will be leaving for other countries because the Nigerian system does not bother about them, should be avoided.  Not just the doctors, nurses too should be taken care of as more of their services are needed in our public hospitals.
Although other professions are affected but that of medicare is more important as it deals with health. Health, they say, is wealth. A situation where a senior doctor may want to leave the country with his former students who have grown on the job for several years, to other countries because of the system in Nigeria calls for concern.
Those who may be wishing to leave should be patriotic. We are aware that many countries of the world like Canada, Australia, Germany, South Africa, to mention but a few, are seeking the services of Nigerian trained medical personnel. But it should be noted that their services are also needed in their country. As Nigerians, they need to be trusted to make some sacrifices as far as their services are concerned.
Some years back, when resident doctors embarked on strike in some of the states, there were threats of “No work, no pay”, their colleagues in other states voluntarily contributed and made funds available to them. 
They should not be poor, but such calibre of persons should not be as it will be degrading. If they lack money as a result of non-payment of salaries and allowances, as punishment for industrial action, they have families and loved ones to cater for. Those who are leaving Nigeria for other climes may not be unpatriotic but need the kind of wages that are commensurate with the jobs they perform.
Researches have shown that brain-drain in Nigeria started in the early ’90s. One worrisome issue is that there are persons who at one time or the other have belonged to these associations before being at the helm of affairs. You discover that there will still be series of industrial action under their watch. So you begin to wonder whether these anomalies cannot be corrected as they are in charge.
Some persons have argued that Nigeria’s education system is poor. How come the nation’s medical graduates are good to the extent that other countries seek their services? I know that Nigeria has well-trained medical personnel who studied at home and can compete favourably at the international level.
Recently, I had an experience with some of our medical doctors, specifically in a female ward in one of our public hospitals; I was amazed at the way they were analysing health issues about women and prescribing the right drugs for the various ailments.
I began to wonder why anybody will say that we are nowhere. The truth is that we have qualified medical doctors. I think the problem is how to attend to their needs. If medical practitioners are asking for, let’s say, COVID-19 hazard allowance, they should be given so they don’t contract the virus.
The stress of a medical personnel attending to so many patients may not be easy, even at nights. When you visit the hospitals, one will not be in doubt that those groups of people deserve better working condition.
Nigerian medical doctors should be patriotic no matter their grievances, bearing in mind that “home is home”. The understanding between the indigenous medical personnel may not be the same as that of foreign medical team. Although there are some whose expertise are higher and left their countries of origin to render one assistance or the other in Nigeria.
There are also Nigerian trained medical doctors based overseas who, after taking a look at the situation in Nigeria, once in a while come home to render healthcare services. That’s a show of patriotism. 
Education of a medical doctor in Nigeria is very expensive. In fact, securing admission to study medicine in the university does not come easy. So it’s like, “handle with care”.  
While the Federal Government may need to look into the demands of resident doctors, NMA as a way of being patriotic, should shift ground during negotiation.  
Brain-drain may not serve Nigeria well so they should not allow some of the best hands to leave.  More so, you cannot tell whether they will return or not.  All hands must be on deck because this is a period of pandemic.  
Here in Rivers State, hospitals have been equipped with facilities of international standard which our medical personnel are competent to handle. The University of Port Harcourt Teaching Hospital (UPTH) and Rivers State University Teaching Hospital (RSUTH) have been equipped by both the federal and state governments. Spirited individuals and organisations have also donated facilities to those hospitals. The Military Hospital in Port Harcourt has also been equipped for anybody’s comfort.  
In fact, the gigantic Mother and Child Hospital built by the Nyesom Wike administration is a testimony that healthcare system has been boosted. I think it is for the right medical personnel to man those facilities.  
If our medical doctors are adequately taken care of, they will not leave the country for any reason. If you think any country is better than Nigeria, such place was not developed in a day. Whatever infrastructure you have overseas was developed over the years.

By: Eunice Choko-Kayode

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