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Ending minimum wage impasse



Ending minimum wage impasse

After a long drawn battle, an end to the recurrent minimum wage battle between the Federal Government and workers appears to be in sight. The positive development was recently crystallised with the setting up of a formidable committee to deal with the issue once and for all.

Although this is not the first time the government would constitute a body to look into the lingering crisis that has seen major labour unions almost grounding the economy on several occasions, this is, however, the first time the committee would be all encompassing.

The tripartite committee include representatives of the federal and state governments, as well as the private sector. This composition, without doubt, instils some level of confidence in the group as all the representatives are expected to deliberate issues with facts on the table.

Apart from the current wage of N18,000 not being commensurate with economic realities on ground, one of the arguments labour have had against it is the unilateral arrangement by the Federal Government to set the amount and subsequently implement it.

However, with the current composition, each of the relevant parties has the opportunity to make its input before the final resolution.
To clear all doubts, the committee, which was inaugurated last month is made up of persons from the public sector, Nigeria Employers Consultative Association (NECA), Manufacturers Association of Nigeria (MAN), Nigerian Association of Chambers of Commerce Industry Mines and Agriculture (NACCIMA) and Nigerian Association of Small and Medium Enterprises (NASME).

Apart the commendable step taken to include representatives of the private sector, the inclusion of the state government apparatus is also very important if only to put an end to the governors’ position in the past that the Federal Government was wrong to fix a minimum wage without carrying them along.

The agitation for minimum wage especially with the Nigeria Labour Congress (NLC) at the forefront has often forced the government to take decisions bordering on immediate palliative that usually returned the situation to the status quo.
While the committee has earnestly started its job, the feelers on ground shows that the amount being agitated for by both the NLC (N56,000) and the factional United Labour Congress (ULC), N96,000, are unrealistic.
However, it is expected that members of the committee will arrive at a common ground that will be acceptable to all the parties and by extension to those they are representing.

Besides the extant law, which stipulates that minimum wage should be reviewed every five years, whether or not there is inflation, the sustained spiralling economic atmosphere is enough to compel government and employers in the private sector to raise wages of workers across board.

Although the proposals by the labour groups appear outrageous and unrealistic, recent developments in the polity with regard to flamboyant lifestyle of politicians and their family members put a lie to such perception.
Apart from the fact that wage increase is a constitutional matter, which ought to be observed by government once every five year, it is on record that as at the time N18,000 minimum wage was negotiated with the Federal Government, the exchange rate then was about N145 to a dollar.

Since then, inflation has risen steadily from around 12 per cent to as much as 18.5 per cent within this period. To imagine that the N18,000 minimum wage fixed over five years ago would still be sustainable is, to say the least, impossible.
What N18,000 could buy as at when it was approved has reduced significantly beyond more than half; it would not be fair to say that we must continue to insist that N18,000 should be what is payable.

In a society where education is not totally free, access to medical care, accommodation, transportation and other social services are cumbersome and expensive, there is certainly a limit to what N18,000 can do today. Little wonder official corruption in public offices is growing by the day despite government’s spirited effort at checking the menace.

Whereas the government had pretended in the past that it could not fund a new minimum wage bill, government officials and politicians have legally and otherwise weaved several rapacious nests around themselves to keep attracting free funds into their private coffers.

As at the last count, not less than 20 state governors were reportedly indebted to their workers. The awkward development is occurring even after receiving over N1 trillion as bailout from the Federal Government as well as recent refunds from Paris Club.

In view of the prevailing economic recession, we believe there is need for the committee to urgently review the current minimum wage and begin to pay an amount that has commensurate value with developments around us.
We must also commend the Federal Government for the urgent step it has taken to constitute the new committee as a way of putting an end to the incessant rancour with labour on the vexed issue.
We also believe that the benevolence exhibited by the government should not be taken as an advantage to strangulate it or box it into a corner and make it sign for a minimum wage it cannot sustain.

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