Wednesday, 27th September 2023

Suspense! As Southwest governors tremble over N30,000 minimum wage

By Muyiwa Adeyemi (Head South West Bureau), Charles Coffie Gyamfi, (Abeokuta) Tunji Omofoye, (Osogbo) Oluwaseun Akingboye, (Akure) and Rotimi Agboluaje (Ibadan)
16 June 2019   |   3:46 am
The N30, 000 minimum wage recently signed into law by President Muhammadu Buhari is creating tension and mutual suspicion between labour leaders and Southwest Governors, who now speak from both sides of their mouths. While most of them agreed to pay the new wage, they have continued to tie the payment to increase in the…


The N30, 000 minimum wage recently signed into law by President Muhammadu Buhari is creating tension and mutual suspicion between labour leaders and Southwest Governors, who now speak from both sides of their mouths.

While most of them agreed to pay the new wage, they have continued to tie the payment to increase in the amount that accrues to them from the federation pool and improvement in their states’ Internally Generated Revenue (IGR).

The uncertain situation has not only put workers on suspense, but has also made their leaders to mull over their plan for “mother of all strikes,” to force the governors to think out of the box and respect the law of the land on wages and emoluments.

Investigation has, however, revealed that there is no state in the Southwest that has begun negotiations with labour movement on the issue. Oyo State that had, at the twilight of Senator Abiola Ajimobi’s administration set up a committee to commence the process has discontinued, following change of government.

Some states have blamed the delay on the National Salaries, Income and Wages Commission’s (NSIWC) inability to gazette the new wage and give them a template for its execution. They also said it would be difficult for states to commence negotiations with their workers, when the Federal Government, which signed it into law, is yet to start paying the new wage.

Osun Incapacitated By Backlog Of Salary Arrears
In Osun State, the implementation of the new wage is likely to pose a serious challenge, due to the backlog of unpaid salaries before the new wage became effective. The government is still struggling to ensure its promise of full payment of the old wage is sustained.

Some aides to the state government, who craved anonymity, said the state governor, Gboyega Oyetola, is worker-friendly and would go to any length to ensure workers’ welfare is taken care of. They said the governor’s appreciation of workers’ contribution to the state’s development, informed his administration’s decision to commence payment of full salary.

Until he assumed office, some categories of workers, beginning from grade level 12 and above, were on modulated salary structure. The former administration of Governor Rauf Aregbesola attributed this to paucity of fund, occasioned by drastic decline in revenue accruing to the state from the central government.

Speaking on the new wage, the Supervisor, Ministry of Information and Strategy, Lani Baderinwa, said the state government was planning to put necessary machinery in motion to enhance its implementation.

He said a committee with the State Joint Negotiating Working Committee would soon be constituted to draw a salary table that would reflect take-home pay of different categories of workers in harmonisation with that of the National Joint Negotiating Council (NJNC).


Baderinwa assured workers that the government would not do anything to compromise their welfare, but would always pursue policies that would enhance their wellbeing and state’s interest.

The Osun State chairman of the Nigerian Labour Congress (NLC), Comrade Jacob Adekomi, said labour leaders were anxiously waiting to receive the new salary table from NJNC.

He said: “We appreciate our members’ anxiety on the new minimum wage. I just want to appeal to them to be patient, so that all necessary steps preceding the implementation can be followed.”

Ondo Awaits Increment In Revenue Allocation
THE people of Ondo State have become anxious, as their hope that the N30, 000 minimum wage would soon be implemented seem to have been dashed. The state government has reneged on its earlier promise to pay the new wage.

On different occasions, the state governor, Oluwarotimi Akeredolu, had expressed his willingness to pay the new minimum wage, while sympathising with the workers that “their current take-home could hardly take anybody home.”

However, during a programme tagged: “An evening with Mr. Governor” on Ondo State Radio-vision Corporation (OSRC) last Sunday, Akeredolu expressed uncertainty over payment of the new wage.

According to him, an attempt to implement the new N30, 000 minimum wage may plunge some of the 36 states of the Federation into bankruptcy.

This was in sharp contrast to his stance during Workers’ Day celebration on May 1 and the inauguration ceremony of newly elected officers of the Nigeria Labour Congress (NLC) on April 25, where the governor, represented by the Head of Service, Mr. Toyin Akinkuotu, assured workers of his commitment to pay the new salary.

Akeredolu said: “We are not against the new minimum wage, and if we are not against it, then we are in support. Our prayer is that Federal Government should look into the revenue allocation sharing formula, by giving more money to states and local governments to enable them implement the new minimum wage.”

In the governor’s view, if the current revenue sharing formula was not reviewed to favour states and local governments, many governors would be handicapped and the new salary scale would suffer a huge setback.

Workers in the state have expressed satisfaction at the present administration’s landmark achievement of not owing workers’ salaries, and paying backlog of salary arrears, since assuming office in 2017.

The state labour unions would begin negotiations for the payment of the new minimum wage, as soon as the National Income Salary and Wages Commission (NISWC) released the template for the new salary.

Akeredolu, who just emerged the Chairman of Southwest Governors’ Forum, said the sharing formula was to the FG’s advantage, while the states that generate the resources are starved financially.

He noted that the increment of minimum wage from N18, 000 to N30, 000 without the review would adversely affect execution of capital projects.

The governor said states had been experiencing dwindling allocations from the Federal Government in the last four months, which, he said, had worsened states’ financial situation.

He, however, disclosed that the Chairman of Nigeria Governors’ Forum (NGF), Dr. Kayode Fayemi, who is also Ekiti State governor, was negotiating with FG on behalf of the governors.

Ekiti Groans Under Yoke Of Inadequate Allocation
AND in Ekiti State, Governor Kayode Fayemi is still battling to clear the backlog of salaries owed workers by the immediate past administration of Mr. Ayodele Fayose.

The state is peculiar, in that it receives one of the least allocations, with a very poor Internally Generated Revenue (IGR). Under the last administration, the monthly wage bill was put at N2.6bn, while the average allocation coming from Abuja hovered around N3bn.

The state had to rely on the bailout fund and budget support provided by the Federal Government, as well as the Paris Club refunds to pay monthly salaries. Fayose said the IGR was between N300m and N350m.

But things are currently looking up in the state, as Fayemi’s government has been prompt in payment of salaries and clearance of the backlog he inherited. This development has been attributed to increase in allocation from Abuja and prudent management of resources by the NGF chairman.

Expectedly, labour unions in Ekiti are eagerly awaiting payment of the N30, 000 minimum wage. Comrades Sola Adigun and Kolapo Olatunde of the Trade Union Congress (TUC) and NLC respectively, said minimum wage was a law and Ekiti State Government must prove that it is law abiding.

Adigun said: “The issue of minimum wage ought to have been dealt with three years ago. We don’t want delay tactics. We want to appeal to the Federal Government to make the guidelines and template ready. This is what states are using as excuse to delay payment of the minimum wage.

“We urge Federal Government to guard sources of revenue jealously. We can refine our crude oil locally. The income from the Port alone can finance the budget, not to talk of money from petrol. If the needful is done, we can pay the minimum wage.”

However, the state government appears to be singing discordant tunes on its readiness to pay the new wage. Recently at an event in Abuja, while officially reacting to the signing of the minimum wage, Governor Fayemi was quoted to have said the state would require additional N2bn to pay the new wage.

But at the opening ceremony of the delegate conferences of the Ekiti Chapter of NLC, on April 25, 2019, Fayemi pledged his administration’s readiness to pay the N30, 000 minimum wage.

The governor, represented at the event by his Chief of Staff, Mr. Biodun Omoleye, said the newly elected leadership of the state trade unions would soon be invited for a meeting on the modalities to ensure the payment.

However, at the monthly television programme tagged “Meet your Governor,” Fayemi, while fielding questions from the panelists, said the N30, 000 minimum wage would only affect workers, whose salaries are below N30, 000. This has been differently interpreted by workers.

Ogun Grapples With Huge Debt Profile
JUST like other governors, Prince Dapo Abiodun of Ogun State promised he would be worker friendly.

Although the state is one of the few in the Southwest many thought should take the lead after Lagos State in executing the new minimum wage, the backlog of deduction owed workers by the Ibikunle Amosun administration and the humongous debt profile have been a source of concern to government and labour leaders.

Two days after his inauguration, Abiodun addressed the workers and assured them that his administration would always pay salaries before the last day of the month. He also pledged never to owe them salaries or allowances.

“I want to assure that you (workers) are central to our vision, because topmost of our vision is good governance and we can’t achieve it without prompt payment of salaries and other benefits,” he said.

His Chief Press Secretary, Mr. Kunle Somorin, who spoke to The Guardian in Abeokuta on the new minimum wage, disclosed that the Governor met with labour leaders “and the issues were raised and
discussed extensively.”

Asked if government was ready to pay the new minimum wage and when it would start, Somorin said: “It is yet to be gazetted by the Salary and Wages Commission. Once that is done, there would be negotiation between the Commission and labour leaders on one hand, and the State governments on the other hand. Whatever the outcome, the government will abide by it.”

The state NLC chairman, Comrade Emmanuel Bankole, said: “As far as we are concerned, there is no going back, everything is settled. We are just waiting for the Salaries and Wages Commission to come up with the table, and then we will commence negotiation. So, for us, it is a done deal and we are not looking back.

“Severally, we have met them (past and present governments), but nothing can happen unless we have that table from Salaries and Wages Commission.”

Oyo Taking Steps To Implement New Wage
THE Oyo State TUC chairman, Comrade Emmanuel Ogundiran, appeared not ready to entertain any excuse from government, as he said the issue had become a national law and all stakeholders were involved in enacting the law before the President assented to it on April 18, 2019.

He said: “Once it is a national law, no state that still wants to remain part of Nigeria will go against it. We don’t want it to be business as usual. The labour is trying to avoid the award of volume of cash, as done in the last dispensation. The National Negotiating Public Service Council is negotiating with the Salary and Wages Commission to fix what will be on top of what workers earn now vis-a-vis the N30, 000 minimum wage.”

The Chief Press Secretary to the Governor, Mr. Taiwo Adisa, said the state was already preparing ground to meet up with the payment by plugging leakages and bringing on board the Oyo State Investments Promotion Commission (OSIPC) to increase the state’s revenue profile to meet up with the financial responsibility.

He said: “When you talk about minimum wage, it is the Federal Government thing. There is also a process to implementation of laws. The Federal Government that got the bill signed into law has not started paying the new wage. Why? Because there will be arrears to be paid by the Federal Government. It is because the Wages and Salaries Commission and the Revenue Mobilisation, Allocation and Fiscal Commission have to give details of the new minimum wage.

“We are waiting for the Federal Government to get details of the implementation, as it will affect the different cadres. Once the details are out, the state will work out implementation and how it will not affect one level or the other.

“Governor Seyi Makinde has said the government will enter into open discussions with workers. The workers are in charge of the revenue. They know the state’s capacity.

“As it is, you can say the IGR is low. There are also leakages to be plugged, which is one of the key issues government is going to address. We will ensure that one of government’s first steps is to bring on board the Oyo State Economic and Financial Crimes Commission. The government will also bring on board the Oyo State Investment Promotion Commission. These are two clear steps in the financial line.”

On how the state will meet its new financial obligation, Ogundiran said the Federal Government that enacted the law will not just watch the state struggle to pay salaries.

“If there are no workers, social life and the economy will not move,” he said. “Polices will not be enacted and implemented and, therefore, nothing may work.

“A lot of things will still take place after the new minimum wage law has been structured. Once this is done, it may end up with Constitution amendment, especially statutory allocation. The system tilts towards the government at the centre. If more weight is shifted to states, they are bound to earn more revenue. Part of it is allocation going directly to local governments, while bailout, Paris Club Refund, loans and grants are given to the state just to ensure salaries are offset…”

AN economist and former consultant to the World Bank, Dr. Samson
Olalere said: “What is required of the governors is to cut down the cost of governance, by blocking leakages and minimising wastes. For instance, why will the vehicles on governors’ convoys be between 15 and 20? Why should they have bloated political appointments? Why should idle hands be kept in government service? You see six to 10 personnel employed to do the job one or two people can efficiently handle.

“All these are areas of wastage that should be blocked. The government must encourage partnership with private sector for development of infrastructures and encourage self-employment through the development of its human capacity.

“Another area is for government to restructure the pension and gratuity system, through introducing the contributory pension scheme, which will relieve it of the huge arrears of retired workers pension and gratuities. Governors need to be business-minded, put on their thinking caps, rather than reveling in the spoils of office and the cosmetic colouration of office, as well as the service of sycophants, who only feed them with falsehood and tell them only what they want to hear, rather than the true situation of things.”

A Business Development expert, Mr. Olusegun Ogundiran said: “At the states’ current capacity, the only way they can meet the demand is by borrowing. But we all know that borrowing to finance a recurrent expenditure is going to bring about debt and increase in poverty in the long run.

“What states can do is to develop a two-year plan that will tap into all possible ways government can improve revenue streams. One of the important revenue channels is the Agric sector. The government can empower farmers and every other player in the value chain to ensure optimisation of resources.

“The goal should not be the primary goods. States should be interested in finished goods that can be used locally, as well as exported. Then, the states will be ready to meet the demand of the minimum wage. And until then, the status quo should be maintained, and government should communicate the plan to the labour unions.”