After months of negotiations, the federal government and Organised Labour have agreed on a new national minimum wage of N70,000.
The minister of information, Mohammed Idris, disclosed this to State House correspondents after a meeting between President Bola Tinubu and Organised Labour at the presidential villa, Abuja, yesterday.
He described the development as “a happy day for Nigeria.”
The new figure represents an increase from the previously discussed N62,000, but falls far short of Labour’s previous figure of N250,000.
According to Idris, the key feature of the new agreement is a reduction in the review period from five years to three years.
He said, “We’re happy to announce today that the federal government and organised Labour have agreed to an increase in the N62,000 (earlier proposed).
“The new national minimum wage that we expect to present to submit to the National Assembly for legislation is N70,000, but that is not all: there is also a boost, as Mr. President has assured us that massive investment will be made in infrastructure.
“There is also a deepening of the federal government’s investment in renewable energy. More money is going to go into acquiring more buses, the CNG buses. Nigeria is going to be more CNG-compliant, according to the president.
“We’re moving in this transition to renewable energy, and all other things that Mr. President has assured Labour about are the issues of Senior Staff Association of Nigerian Universities (SSANU) and Non-Academic Staff Union of Educational and Associated Institutions (NASU) which will also be looked at.
“And we are happy; we are very thankful for organised labour’s role today; they recognised the federal government’s role in ensuring that we have the local government autonomy and that both the organised Labour and the government are on the same page today.
According to the information minister, Labour has shown “a deep sense of patriotism to ensure that Nigeria remains united, Nigeria becomes more prosperous, and it is in that spirit that they agree with what the federal government has done today.”
Idris further thanked President Tinubu, the federal government, the state governments and the organised private sector for their efforts at resolving the minimum wage issue.
Speaking on the newly approved minimum wage, the minister of state for labour and employment, Nkiruka Onyejeocha, said the meeting was an end in sight for all Nigerians.
She noted that President Tinubu had equally directed that the national minimum wage for Nigerian workers be reviewed in three years.
President of the Nigeria Labour Congress (NLC), Joe Ajaero, expressed caution about the deal.
He highlighted the importance of the shorter review period and the government’s commitment to addressing other labour concerns, including the recent confrontation involving the FCT Commissioner of Police.
He said, “Well, we were here last week, and we’re here now. What we announced in terms of the amount of N70,000 happened to be where we are now. But the cool thing about it is that we will not wait for another five years to come on review.
“Rather than settling on a figure that will wait for five years, it is like we’ll have to now negotiate even two times within five years, to go up. That is one of the reasons you know why we decided to reach where we are today.”
Trade Union Congress (TUC) President Festus Osifo also welcomed the agreement, noting that labour had been pushing for a shorter review period due to rapidly changing economic conditions.
He expressed satisfaction with the president’s willingness to address the SSANU and NASU issues, emphasising the importance of keeping universities open.
“The president made a pronouncement or announcement of N70,000. By next week, they should put the finishing touches to the bill and the transmission to the National Assembly
“But why this became a catch is actually because we, from organised labour, have been pushing than that the issue of five years review is to me so much; that a lot a lot of economic indices may have changed, because we are in an era where things are moving very fast in terms of both macro, and microeconomic policies,” he said.
Tackle Inflation For Meaningful Impact
Co-founder & CFO, Tranzfar Group, Dr Olusiji Sanya, said the minimum wage is usually balanced between wages people to live on and what the states and other employers can pay. He, however, said controlling inflation was crucial to workers’ wages.
He said: “The issue is not the level at which you set the wage. The issue is that we have not been able to tackle inflation, and if we don’t fix inflation, even if the minimum wage is increased to N200,000, it will still not be enough. So, for me, the increase in the minimum wage is like a cosmetic measure because the fundamental problem of inflation has not been fixed. “Despite the Central Bank of Nigeria’s (CBN) monetary policy approach, which has taken us to a 30 per cent interest rate, we have still not solved the issue, showing that the approach is wrong and not working.
“Additionally, for anyone who earns the new minimum wage of N70,000, in another few months, that money will not be enough, which is my concern. Inflation is the real issue: the N70,000 will not mean much for any household because everything has increased in price. The costs of power, fuel, and food have increased. So, for the average household, the core inflation items people spend money on have increased by 100 per cent and beyond. So, how much do you want to continue to give to fight that kind of price increase?”
Ops Seeks FG Support For Sustainable Payment Of N70,000
Meanwhile, the Organised Private Sector (OPS) has called on the federal government to assist them sustain the new national minimum wage of N70,000.
In a chat with LEADERSHIP Friday, the director general of Nigeria Employers’ Consultative Association (NECA), Adewale-Smatt Oyerinde, said: “While we commend the president for putting to rest the immediate issue of the national minimum wage, we also note, most importantly, his commitment to support the sub-nationals and the OPS to pay the new wage.”
The NECA boss noted that during the consultations at the National Minimum Wage Committee, the Organised Private Sector strongly expressed concern about its ability to pay the N62,000 recommended by the Tripartite Committee.
“In fact, the much anticipated N62,000 was based on expectations that the government would reduce the current economic burden on the OPS,” he said.
According to Oyerinde, OPS agreed to N62,000 as minimum wage based expectation that their request for the reversal of the increase in electricity tariffs, including that the Central Bank of Nigeria (CBN) redemptions of all outstanding forwards for companies in the productive sector, would be granted by government.
He added that the OPS also want the government “to freeze all new taxes and levies on businesses for the next five years; duty exemption on imported conversion kits and government subsidy on procurement of same; a fixed rate of N800 for the assessment of import duty on all production inputs; a revisit of the recent Financial Reporting Council regulation to curtail its application to private businesses; enforcement of the Executive Order 003 and 005 on Patronage of Made in Nigeria Product by ministries, departments and agencies (MDAs) of government and the National Assembly, and the discontinuation of the Price Verification Portal, as it is inimical to the smooth operation of businesses and the basis for setting it up no longer exist, among others.”
Ojerinde stated that since government had pushed the minimum wage to N70,000,
it should be noted that the ability to pay remains a fundamental consideration.
“The proposed support by the president to organised businesses should be immediately announced to enable businesses to plan effectively. The private sector will continue to partner with Organised Labour to ensure compliance and inclusive economic development, while we look forward to the support promised by government,” he said.
In the same vein, the president, the National Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Dele Kelvin Oye, called on the government to promptly release the 2024 fiscal policies and for the Central Bank to intensify efforts to stabilise the Naira and stem inflation.
He said that without immediate and effective strategies to control inflation, further agitations may arise before the stipulated three-year review period.
Oye commended both government and Labour for resolving the issue.