By Kadiri Abdulrahman
The Nigerian government recently implemented a new minimum wage of N70,000 per month after prolonged negotiations between the government and labour unions.
The need for an improved minimum wage became crucial in order to address the rising cost of living and improve the standard of living for the workers.
The previous minimum wage of N30,000 had been in effect since 2019, and it was widely considered to be insufficient to meet current basic needs.
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This became more so due to certain fiscal and monetary policies of the President Bola Tinubu-led Federal Government.
While being sworn in on May 29, 2023, Tinubu had announced the removal of fuel subsidy, effectively ending the regime of controlled prices of petroleum products, especially the Premium Motor Spirit (PMS).
Shortly after, in June, Tinubu also floated the country’s legal tender, the Naira, a policy that unified multiple exchange rates in the foreign exchange markets, which resulted to a huge devaluation of the currency.
Both policies created a harsh economic situation, with prices of basic goods and services skyrocketing beyond the means of average Nigerian workers.
Tinubu had, during the campaigns before the 2023 general elections, promised to ensure that Nigerian workers enjoyed a “living wage” if elected.
The new minimum wage of N70,000 was expected to provide some relief to workers, but it remains to be seen whether it will be enough to significantly improve their living standards.
The implementation of the new minimum wage, however, has been met with mixed reactions.
Some stakeholders believe that it is a positive step that will help to reduce poverty and inequality, while others argue that it could lead to job losses and inflation.
Yet, there are other stakeholders who said that the amount was too small given the economic realities in the country.
A lawyer , Olu Omotayo, called for full implementation of the minimum wage to enable workers benefit from it.
Mr Godsown Onuzulike, a businessman, said that the amount could not do anything for workers considering people’s basic needs and the cost of commodities in the market.
According to him, it will not do anything for a civil servant with a family of four.
He said that the only way it could benefit civil servants was if they cut down their expenses.
He advised them to choose affordable schools for their children and affordable accommodation.
“They should shun expensive private schools and accommodation to be able to manage the minimum wage and meet up with daily needs,” he said.
A civil servant, Mr Christian Alumona, said that the amount was too little, considering the hard economic situation in the country.
“How can I cope with N70, 000 minimum wage when a bag of rice is almost N100, 000?
“How can we survive as civil servants. This is a difficult one. I expected minimum wage of N100,000 to N150, 000,” he said.
He said that the amount would not be the same again after consequential adjustment had been affected.
Some federal civil servants are, however, concerned that some state governments are paying a higher minimum wage than the Federal Government.
Lagos state had approved N85,000 as minimum wage, same with Rivers state. That is N15, 000 higher than N70,000 approved by the Federal Government.
Bayelsa, Niger, Enugu, and Akwa Ibom, approved N80,000.
According to Raymond Haruna, a civil servant, it is an aberration in an economy like Nigeria, for the Federal Government to insist on N70,000 when some states are paying between N80,000 and N85,000.
“This is the first time I am witnessing such in Nigeria, and I think it is unfair to the federal workers,” he said.
The minimum wage is the lowest salary or wage permitted by law following negotiations between the labour union and government.
It sets a floor for how much employers can pay their employees, and it covers both private and public sectors.
Experts say a fair and competitive minimum wage is crucial to promoting economic growth, reducing poverty, and improving the overall standard of living.
They added that Nigeria has had a long and difficult journey with minimum wage, with the Nigeria Labour Congress (NLC) playing a crucial role in championing the cause for a fair and living national minimum wage.
The impact of the new minimum wage will vary depending on the sector and region, they said.
Businesses in the formal sector are more likely to be able to absorb the increased costs, while those in the informal sector may struggle.
Overall, the new minimum wage is a significant development that could have a positive impact on the lives of millions of Nigerians.
However, it is important to monitor the situation closely to assess its impact and make any necessary adjustments.
News Agency of Nigeria (NAN)
