Minimum Wage: Allow States To Decide

This week, the National Council of State approved N27, 000 as the national minimum wage for Nigerian workers. Coming on the heels of warning strikes that almost crippled the nation, the approval is seen as a prologue to final resolution of the festering issues regarding the welfare of workers. According to the new rate that has attracted the attention of federal lawmakers, states are required to pay the minimum wage, while the federal government has resolved to pay N30, 000 as minimum wage for its workforce. The approval of the new wage has set the workers’ union on edge, with the Nigeria Labour Congress (NLC) meeting yesterday to decide on next line of action. There are already signs that the union may force states to swallow the bitter pills despite reservations by some state governments on implementation of the new rate. For instance, in Zamfara state, the minimum wage is N6, 000 and some of the workers cannot remember when last they were paid. Despite doling out several billions of naira by the federal government to states as bailout funds to settle outstanding arrears, Nigerian public sector workers are still entrapped in uncertainty over the possibility of getting paid at the month end. No matter what happens, most of the states cannot meet the obligation of paying the new wage rate, considering the revenue profile of most of them.

In a situation where governors depend on monthly federation allocation, the problems of non-payment of salaries will take a long while to be resolved. Even if the states are to pay the new rates, such states may resort to retrenching workers in the order to pay the new minimum wage. Truth be told, it is not in line with the principle of federation to foist a single salary structure on all states. Since some of these states do not generate equal revenue to run their affairs, it should be stressed that states be allowed to set up their own minimum rates in line with their capacity to pay. In the United States of America, there are wage differentials, as states are free to determine their minimum wage. Such wage rates are often reviewed to reflect economic realities of the moment. In a country where jobs are scarce amidst a turnout of over three million graduates every year, imposing minimum wage on the country is tantamount to doing things that can never yield positive result. As long as states await the central government to spoon feed them without embarking on positive projects aimed at developing society, so long will industrial action continue to frustrate any move aimed at instilling orderliness and development.

What workers should be concerned about now is not the amount of money to be paid as salaries, but the value of such wages. With inflation down on its knees, culminating in too much money pursuing fewer goods, we do not need any seer to predict harder days ahead as the nation continues to grapple with issues of development. For Nigeria to come out of this Plato’s cave of despair, we need to resuscitate collapsed industries in various states and engage our teeming youths that are turning into frightening fireworks for an uncertain future. Some of these collapsed factories that used to engage millions of Nigerians are now comatose with most of their premises turning into hideouts for reptiles and criminals. The once flourishing textile companies in Kano and Kaduna are now a hoary tale of a glorious era for a nation that has always prided herself as Africa’s giant.

The power sector has grown so unwieldy that no matter the amount of investment, darkness remains the lot of Nigerians. Even when power generation hit 7,000 megawatts, ordinary citizens are still at a loss why we are yet to crawl out of the curse of darkness. In embracing foreign goods and allowing our country to be a dumping ground for all manufactured goods from Europe, Asia and the Americas, among others, we invariably provide a lifeline for their economic development, while putting the lock on our prospects for growth. Our taste is now foreign and not even the poor are willing to patronise locally made goods. Cost of production is so high that doing business is dead on arrival. If we must survive these present hard times, government’s emphasis on industrialisation should go beyond lip service. We have not been able to tackle our impediments because we place much emphasis on crude oil that is gradually becoming obsolete. With electric cars from developed countries set to define the future, we cannot continue to insist on not doing the right thing by refusing to explore alternative sources of income. We may have been blessed with abundant population that serves as a springboard for development, but we must get it right in providing job opportunities for our people who are daily traumatised by hunger. We cannot decree economic development and amelioration of workers’ condition by fiat; adequate efforts aimed at resolving issues that threatened our collective survival as a nation must be pursued vigorously. Anything short of allowing states to agree on minimum wage for their workers is an elongation of a problem that will remain an albatross.

Read More at:

Saturday Column