That FG’s Wage Review Initiative

Four years after the introduction of the National Minimum Wage (NMW) of N30,000 a month, the Federal Government has set up a monitoring team to identify states that are not implementing the salary. The Minister of Labour and Employment, Dr Chris Ngige, revealed this at the sensitisation workshop to kick-start the implementation strategy in Abuja.
Ngige also indicated that the government was working to increase workers’ allowances in the New Year without a commensurate increment in salaries in line with the current economic reality. He said a Presidential Committee on Salaries was carrying out a review of the existing salary structures and was expected to come up with salary adjustment early in 2023 to cushion the effects of the high inflation rate in the country.
According to the minister, no establishment can claim ignorance or non-involvement in reaching the collective bargaining agreement (CBA) on the national minimum wage. The minister, who was represented by his Special Assistant, Mrs Chinedu Clara Dike, insisted that ensuring compliance with the NMW Act was a sure way to ensure that workers were not short-changed and that productivity was not endangered.
The Labour Minister stated that a satisfied worker would surely contribute effectively and efficiently to the sustainability and growth of the enterprise. This, he said, would chip in national development and fewer disruptions in productivity due to industrial actions in any of its variations. He believes that the Sustainable Development Goals (SDGs) were a call to action to end poverty.
Also commenting, the Statistician General of the Federation, Prince Semiu Adeyemi Adeniran, who was represented by Adeyeye Elutade, maintained that a new minimum wage was due given that when the N30,000 minimum wage was implemented in 2019, inflation was 11.40 per cent and now inflation is 21.47 per cent (88.3 per cent increase).
For the Statistician General, the government intends to move 100 million Nigerians out of poverty in 10 years, but with the N30,000 minimum wage, it appears impossible to achieve the goal. Likewise, in 2019, the poverty level was 40 per cent as against the 63 per cent poverty level now, Adeniran pointed out.
But the Nigeria Labour Congress (NLC) Deputy President, Joe Ajaero, who reacted to the planned wage review in a chat with journalists, proposed a detailed meeting between all the stakeholders of the government, employers, and labour unions to review the minimum wage. Ajaero said the government must honestly consider the inflationary rates, cost of living and other factors before announcing its decision.
This move to ensure the implementation of the minimum wage across all states of the country is a most welcome development. Undoubtedly, the last wage increase has been enforced in breach in most states. And all efforts by the NLC and the Trade Union Congress (TUC) chapters in some states to secure full implementation have not yielded the required results.
Although the Federal Government’s action is commendable, we are worried that the step is coming almost late, many years after the last wage increase. We are equally concerned that this measure, arriving in the twilight of the President Muhammadu Buhari administration, may not achieve the desired result as electioneering campaigns are gathering steam and may distract the process.
Again, disclosing plans to raise workers’ pay less than six months before the end of the administration may be seen as politically motivated, and not driven by a genuine desire to advance the interest and welfare of workers.  Besides, any salary increase that does not carry along relevant unions in the labour movement will not achieve its aim.
As Ajaero rightly indicated, given the skyrocketing inflation, stagnating wages and near economic meltdown, it is significant that the government does the right thing. And the proper thing is for the authorities to review wages strictly in line with the rising inflationary trend. The truth is the current wage level is far lower than expected, and cannot meet the expectations of workers.
The National Bureau of Statistics in its Consumer Price Index Report last month said inflation in Nigeria had continued to rise, hitting a new high of 21.47 per cent in November 2022. Similarly, the food inflation rate also increased to 24.13 yearly, showing a 6.92 per cent increase compared to 17.21 per cent recorded in November 2021. Most of the factors cited for the increase include importation induced by perennial currency depreciation and an increase in the cost of production and energy cost.
The World Bank recently said Nigeria might have one of the highest inflation rates globally in 2023, with increasing prices diminishing the welfare of Nigerian households. Indeed, some analysts, while projecting into the year, also predicted that the outlook for a stronger Naira against the Dollar in 2023 is bleak. This may indicate that a gloomy fortune awaits Nigerian workers this year.
Furthermore, the World Bank’s Senior Economist for Nigeria, Alex Sienaert, projects that debt service will take up 123.4 per cent of Nigeria’s revenue in 2023, adding that the expanding debt service-to-revenue ratio and the amount of Nigeria’s public debt, which will put more pressure on the local currency by 2023, are both causes for concern.
To mitigate the likely harsh effects, the pundits canvassed salary review and renegotiation of wages across the board to sustain the aggregate demands coming from workers and to strengthen their purchasing power at times like this. Of course, we think that a call for higher wages is appropriate. After all, the introduction of a new minimum wage at this time is not selfish or misplaced, especially considering the five-year lifespan of the current N30,000 coming to an end this year.