GOVT, LABOUR AND THE MINIMUM WAGE

The issue of minimum wage is about what is ideal, reasonable, affordable and moral, argues AYODELE OKUNFOLAMI  

Nigerians awaited to hear something on the national minimum wage, whose negotiations have been ongoing from President Bola Tinubu during his nationwide Democracy Day broadcast. Yes, Tinubu did say something but not what Nigerians wanted to hear. Nigerians expected Tinubu to be more specific with the numbers. All the president said was, “We shall soon send an executive bill to the National Assembly to enshrine what has been agreed upon as part of our law for the next five years or less.” Who are the “we”, when in particular will the executive bill be sent and what specific figure was agreed upon?

Minimum wage negotiations between the organized labour unions and the federal government has been ongoing for over a year now. Besides the minimum wage which currently stands at N30,000 being overdue for review, the soaring cost of living, skyrocketing inflation, falling naira and more frustratingly, the opulent lifestyle of the political elite makes the minimum wage talk more urgent.

Labour had initially demanded N615,000 as the minimum wage after calculating what it would take to feed a family of four for one month using the prevailing market prices when federal government proposed N48,000. As labour went down to N497,000, government upped it to N54,000. History tells us that they would agree midway but the way government is moving the knob in units, that is doubtful. The last I heard as the tripartite parties  came out from negotiations is that labour stuck to N250,000 while government says it can’t afford more than N62,000. What is agreed (if there was an agreement) has not been made public. We are watching to see what the “we” will pass to the National Assembly and how labour will respond.

The issue of minimum wage is about what is ideal, reasonable, affordable and moral.

On affordability, the federal government and the 36 state governors are claiming insolvency and inability to pay the minimum wage. In fact, some have not even started paying N30,000 while one of them even said some workers in his state collect N7,000. That is criminal! How can Nigerians believe the nation is broke?

With only 15 ministers serving a population of over 300 million  America is generating a GDP of $28.78 trillion compared to Nigeria whose GDP is a paltry $0.48 trillion having 47 ministers, a lot of whom we don’t know, presiding over a population of over 200 million. The Eurozone that generates a GDP of $16.07 trillion have prime ministers that use public transport while Nigeria that is struggling to meet its OPEC quota is buying SUVs for its parliamentarians and built a N21 billion accommodation for the vice president as if the former VPs lived under a rock. I have not even mentioned sponsoring of religious pilgrimages or building airports where planes never land. It is these offensive and sickening spending by the political class that government cannot have a moral argument that it cannot afford union demands. The optics is that Nigeria is not lean and mean but that her wealth is lopsidedly distributed.

The minimum wage is a legal issue, reason why the President mentioned sending it to the National Assembly. What this implies is that it becomes illegal to pay any Nigerian below the minimum wage when signed into law. It means from youth corps members to pensioners and everyone in between will be placed on the minimum wage. Now, some have argued that in a federal system like Nigeria, individual states should determine what it can pay and respective union chapters negotiate accordingly. I disagree. If governors and legislators earned flat salaries irrespective of the fiscal size of their states and constituencies, why now bring that case when it concerns the Nigerian worker? Secondly, every nation sets standards in education, healthcare, public transportation, marriage, who a child is et cetera, so why not have a legal minimum wage that no Nigerian worker should be paid below? It is called MINIMUM WAGE, it simply means states should exercise their respective fiscal strengths by choosing to pay higher.

Some have described labour’s demands ridiculous because along with capital, entrepreneur and land, it is also a factor of production. So aside making the economy having more money casing fewer goods when salaries are raised, the cost of production increases thereby making inflation inevitable. That’s logical.

However, inflation has been galloping long before labour made demands. Where is the inflation argument when legislators’ salaries top the global league table but when poor workers ask we remember we had credits in economics? Nigerian inflation is more fiscal than monetary. Spending power is grossly reduced, job losses are highest in a generation, multinationals are relocating abroad while smaller enterprises have gone extinct. Henley & Partners reported last Tuesday that 300 millionaires will emigrate out of Nigeria this year alone.

That is N300 million at least out of the Nigerian market. All these simply means there is less money in circulation and so placing the rising inflation on more money in the hands of workers is jaundiced. Consumer prices of goods and services gradually rose to a three-decade high last month, especially that of food stuffs, not because many want to buy them but because of infrastructural constraints, insecurity and local dislocations within our economy.

And those that say union should not be fighting selfishly for better pay because of the inflationary consequences or unemployment it may cause miss the point. The purpose of unions everywhere in the world is workers’ welfare. It is not their responsibility to fight cost of governance or reduction in living costs. There are internationally funded civil organizations and opposition political parties to speak against purchase of presidential plane and all worth not. Unions are meant to fight for themselves. Rivers people are fighting for their state. You fight for yourself.

Moving forward, some empirical analysis have come up with N104,000 or thereabout as the ideal minimum wage based on current market realities so I believe government should take a cue from that and do the needful. NLC/TUC have made enough compromises in my opinion, it is government that understands nothing but industrial actions that should come up with something. It is the tripartite committee not labour that should consider economic realities.

The political elite should return to reality and stop speaking grammar on the difference between salary and wage. It is said that if you pay your workers peanuts, you will end up having monkeys for you. Do they expect to be safe forever when their cooks, guards and drivers, that commute from cholera prone areas daily, are poorly paid? They should not just be sloganizing sacrifice after Eid prayers, they should know that Nigerians have had it up to here, Armageddon is brewing so the leaders should please walk their talk. They should not only resolve it in cash to the workers, they should also act in character by reducing the cost of governance, fix the economy, reduce the cost of living, and establish a just and true society. In addition, implement the Oronsaye report and make the civil service more productive per capita.

You cannot have monkeys working for you and expect the economy to improve. You will only end up having a monkey village. Poverty does more harm to democracies than weak institutions. So if they want to celebrate more Democracy Days, they should take the welfare of workers and citizens serious. You cannot claim to be fighting corruption when poorly paid civil servants are seeing their predecessors dying on pension queues. Already, workers’ withdrawal from their voluntary pension savings increased by 87.6 per cent in the first quarter of 2024. You cannot be wondering how official government gets leaked to the public when confidential files are passed from one poorly paid staff to another. You cannot demand discipline if staff welfare is taken for granted.

Entrepreneurs are living with their capital. They found it the cheaper option than continuously increasing the cost of their products for customers that cannot afford them. Likewise labour will not strike forever negotiating with recalcitrant leaders. They too will japa to where its services are better appreciated. What you will have left to implement your campaign promises (if you ever had plans to do so) will be monkeys.

 Okunfolami writes from