Spending 72% of revenue on personnel cost, not sustainable – FG

…as Reps, organised labour, OPS support N30,000 minimum wage


Kehinde Akintola, Abuja

Federal Government on Monday observed that the payment of N2.618 trillion spent on personnel cost in 2018 fiscal year which represents 72% of total revenue accrued last year, was unsustainable.

Zainab Ahmed, Minister of Finance and Udoma Udo Udoma, Minister of Budget and Planning stater this during separate presentations at the public hearing held at the instance of the Ad-hoc Committee on National Minimum Wage bill, 2019, chaired by Yussuff Lasun, Deputy Speaker of the House of Representatives.

Ahmed who expressed the resolve of the present administration towards meeting its financial obligations to workers by ensuring prompt payment of salaries, pensions and other emoluments, however observed that the revenue accrued to government on monthly basis is lower than the projected revenue targets.

In his brief presentation, Governor Abdulaziz Yari of Zamfara State, chairman of Nigeria Governors Forum (NGF) who argued that States cannot afford to pay the N30,000 new wage, called for immediate review of revenue sharing allocation between Federal, State and Local Government.

He also expressed the resolve of the State Governors towards implementation of the N27,000 adopted by the Council of State.

According to Yari, previous efforts by the President Olusegun Obasanjo to review the revenue what ng formulae was unsuccessful, adding that there is need for urgent bridge of disparity between revenues accrued to Federal and State Government.

The NGF chairman, who noted that Federal Government has several opportunities to explore in terms of revenue generation, however lamented that no bank is willing to give loans beyond the tenure of a sitting government.

In his presentation, Ayuba Wabba, President Nigeria Labour Congress (NLC) who spoke on behalf of the organised labour, recommended N75,000 fine for erring employers against the N5,000 recommended by Federal Government.

He also advocated for adoption of 4-year cycle for the review of the National Minimum Wage against 5-year recommended; removal of threshold for employers with less than 25/ workers and ensure that all the social partners: Organised Labour, Organised Private Sector and Federal Government are adequately represented in the Committee that will enforce the national minimum wage review as encapsulated in the proposed legislation.

The NLC President argued that 30 state governments have already expressed interests in paying the N30,000 as proposed by the Tripartite Committee as contained in the report submitted to the Ad-hoc Committee.

According to him, minimum of 11 million workers will benefit from the new minimum wage and impact positively on the purchasing power of Nigerian workers and the economy at large.

He argued that N30,000 demanded by organised labour translated to N50 per meal for each member of a Family of 6, just as he dismissed report that the implementation of minimum will lead to increase in inflation rate as alleged by those opposing the adoption of N30,000 adding that inflation rate was reduced to 7.9% when the last minimum wage was enacted.

While declaring the public hearing open, Yakubu Dogara, Speaker of the House of Representatives who associated with Nigerian workers said: “In view of the foregoing, the House is approaching this exercise with a very high sense of duty, responsibility and loyalty to our nation. Let me assure the Nigerian workers, that the National Assembly is aware of and shares in your pains, patience and sacrifices as regards the issue of the National Minimum Wage.

“Majority of our Members are on your side as you can judge from their contributions to the debate on the Bill on the floor of the House last Thursday. Armed with these sentiments and taking into cognizance the decision of the tripartite committee that provided the initial ingredients for this Bill, we should have no difficulty taking a decision that is in the best interest of our workers and the nation.

“While we are not oblivious of the current economic downturn and the dwindling revenue of Government, we cannot also be blind to the fact that all economic indices indicate that even the N30,000 Minimum Wage that Labour is asking for is not enough to sustain a small family unit. The nation may not have enough to satisfy the minimum demands of the Nigerian worker, but as a nation, we need to set our economic priorities right and ensure that we dignify our workers by making allowance for their minimum comfort. I know of no alternative if we hope to up the productivity level of our workforce,” Dogara observed.

While pledging the resolve of the House to give accelerated consideration to the minimum wage bill, the Speaker affirmed that the bill “is long overdue, as the current National Minimum Wage, which was fixed in 2011, has become unrealistic due to supervening developments in the nation.

“As most of us here must be aware, the National Assembly will need to go on a short recess for the purpose of the General Elections, which is less than three weeks from now. We must, therefore, conclude this Public Hearing as quickly as possible today to enable the House proceed with further legislative actions on it at its plenary tomorrow as already resolved in our last sitting.

“More importantly, the consideration and passage of this Bill is equally exigent because our country is at the brink of a national industrial crisis that we can least afford at this time. Passions are extremely high within the entire Organised Labour on this issue. Even before the consideration of the Bill by Parliament, the Labour leaders have rejected the 27,000 Naira recommended to us by the Executive Arm as National Minimum Wage.

“At the slightest opportunity, the entire workforce in the country could be called out by Labour leaders to resume the strike action that was recently put on hold without any further notice.

“The effect that such scenario can have on the ongoing electioneering process is better imagined than experienced. There is no doubt, therefore, that the entire nation is awaiting and looking up to the National Assembly to do the needful with the promptitude it deserves.

“I have said before that poverty is the greatest threat to our democracy. Those who doubted me have seen that threat manifest itself in vote buying and in the use of money to compromise electoral and security officials during elections.

“On account of the sense of despondency and powerlessness that poverty breeds amongst the poor, the poor have and will always remain ever ready tools in the hands of tyrants and demagogues, who in the course of history, have always found it easy to mobilize for the purposes of subverting democratic Institutions. Since underemployment and unemployment are bedmates of poverty, eliminating them must be the focal point of government’s policies.

“The next evil is corruption. It is not in doubt that corruption fundamentally undermines democratic institutions and values. Corruption affects the poor most because they depend more on government for support. How then do we fight corruption from the roots rather than dealing with its symptoms as is currently the case? The answer is for us to begin to pay workers living wage not minimum wage.
When we do not pay living wage, we cannot tame corruption.

“When workers take home is not enough to take them home, the temptation for them to cut corners in order to get home will always be there.

“Workers keep and process our national wealth and the only way to insulate them from the temptation to want to help themselves to it, is to ensure they are well remunerated. It is not in contention that it is a mean job to muzzle an ox when it treads out the grain. Leaving workers to their temptations is dangerous unless we can show that they are greater than Oscar Wilde, who in his vintage wicked wit, proclaimed, “I can resist everything except temptation”.

“That we cannot pay living wage in a nation that represents a major promise for economic prosperity in the world speaks to the bane of our leadership. In order to reverse this tragic narratives, we must invest in proactive and innovative leadership not the reactive leadership model that we practiced all this while,” Dogara noted.

“Therefore, I cannot wait for that Nigeria to emerge wherein workers are paid wages that would not only take them home but have a portion to spare in savings in order to pursue happiness and give their children the training that they could ever dream of. That should be our national goal going forward if we hope to ever make it to the club of elite nations. If we do not ever make it to the point where we can have a conversation about Economic justice, it would not be because it’s impossible to achieve but because we lack the right leadership.

“We have talked about ending so many things in Nigeria, now is the time to talk about creating wealth and ending poverty; and those who bear the burden of the nation must be the first beneficiaries.

In their respective presentations, Nigerian Employers Consultative Association (NECA) and other social partners while noting that the N56,000 initially demanded by Organised Labour represents 211% increase over the subsisting minimum wage of N18,000, adopted the N30,000 as new minimum wage.

On its part, National Association of Small and Medium Enterprises (NASME) which adopted the N30,000 as minimum wage, called for full implementation of the Local Content Act and Trade Policy and ensure market access; as well as enforcement of relevant Executive Orders; Public Procurement Act, patronage of local industries and reduce cost of governance.

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