Indecent Proposals for Wage Increase (1)

Anthony Kila advises federal government against arbitrary increase in workers salaries saying what Nigerian workers need now is not the amount they get paid but a wage that can allow them cater for themselves and their loved ones.

Dear Mr President,

Today’s epistle is directed at you to reflect on the issue of minimum wage in the country.

I write directly to you Mr President in your position as the Chief Executive Officer (CEO) of all matters in the country including that of the economy in general and minimum wage in particular. The purpose of today’s epistle is to, in very plain and direct language, invite you and others to consider and indeed take a different view on this very important and now nagging issue of the minimum wage and by so doing on the economy at large.

I write with the hope that these reflections will give you and the country as a whole the courage and insight to go beyond common and accepted positions on how we treat matters related to wages and other incomes in the country.

There is a prevailing narrative that most of us seem to have bought into about wages in this country and beyond. The narrative is that with general increase in cost of production and price of goods and services, it is only logical and fair that wages of workers and even others should go up with the increase in the price of goods and services.

It is a popular view that is based on a romantic sense of fairness and justice, so strong and popular is the automatic increase in wages sentiment that any view contrary to such stance is automatically regarded not only as unpopular but even an indecent position.

Even you, Mr President, appears to be seduced by the allure of this charming popular position of “increase in cost and prices of goods and services must be faced with increase in wages”. I have news for you though: Some of us take the contrary view sir.

I and others take a contrary view knowing very well that our views might be considered indecent, no problem at all. We take such outrage and disparaging comments that might ensue on the chin and with a thick skin. It is legitimate to think anything of another persons view, all views are based on the limit and extent of our education, exposure and experience.

Just as others, many others, might think the contrary views expressed here are not just, not fair and even unrealistic, allow me to respond that their view on wage increase in naïve and shallow. No disrespect intended but it is important to make clear that the idea that we must increase wages to deal with inflation is akin to giving a child junk food (made of salt, sugar and maybe oil) just to make the child happy, show them we love them or even just to keep them quiet.

Any child would love such a solution but does it solve the problem? Addiction, concentration problems, diabetics, learning difficulties and obesity are some of the health and social risks that await a child who got love measured in salt, sugar and oil.

Careful and informed analysis has shown us beyond any reasonable doubt that what a child needs are attention, communication, discipline, education, good example to emulate, healthy food and inspiration. The rest is corruption…

Careful and informed analysis will show us beyond any reasonable doubt that what workers need is a wage that can allow them cater for themselves and their loved ones not the amount they get paid. The reason why workers ask for more money is that the amount they currently get paid cannot pay for accommodation, food, education, health, and maybe a bit of good time, the wise ones will also want a bit more for some investment and plan for their future. The reason why organised labour keeps asking for more money is that they have to show their members that they are doing something to improve their lot. What better and more direct way to show love and commitment than to ask for more money?

What if we gave them more money, say we doubled, tripled or even quadrupled the amount they are currently paid and we realise that such increase is still not enough to do the things they wanted to do before we increased their pay. Do we increase it again?

I do not know how that sounds to you but fact is that we have done so before and it has not solved our problems rather it has made things worse.

I insist on using a plain language in this conversation so that not only accountants like you and your economists will understand these considerations but allow me to ask a question:  Have you noticed that we have not had and we are not having conversations about protecting purchasing power of wages as a people?

Rather than deal with the reasons that make workers want more money we have tend to see how we can promise them more money.

I think is worth mentioning here that, if we are to measure the ability of government to keep their promises to labour, we cannot but conclude that it is so far so bad.

It is also worth mentioning to labour, and for the benefit of all, that beyond misplaced priorities and waste, the reason government at various levels are not keeping their promises is that the money is not there, at least not money enough is available.

A cursory look at the list of the of States of the federation that have been able to pay the agreed minimum wage and those that have not been able to pay such wage will make anyone quickly and better understand what “there is no money” means.

Instead of an automatic increase in wages, my indecent proposal is that we review, redefine and reshape questions around the causes of high cost of living as well as the causes of the weakness of the purchasing power of wages and come away from our observations with solutions that will lead to a new social contract that will focus on the protection of the purchasing power of wages and other incomes.

Deliberations and formulations of such new social contract will be very different from and will involve more stakeholders than the ones listed to be part to the 37-man tripartite committee set up to deal with minimum wage.

Join me if you can on twitter @anthonykila to continue these conversations.

-Kila is Institute Director at CIAPS. www.ciaps.org