OP-UNEDITED | The Minimum Wage Dilemma – By Andrew Efemini
By Andrew Efemini
The minimum wage is one of Nigeria’s most problematic and controversial issues. The reasons for the view are:
1. Nigeria’s minimum wage has never been enough for workers in terms of purchasing power.
2. In spite of its extreme inadequacy, we have noted that employers have failed to pay the minimum wage with the regularity that wages deserve.
3. The states and Local governments are the most guilty of the crime of having backlog of unpaid salaries.
4. The Nigeria Labor Congress (NLC) and Trade Union Congress (TUC) have managed this issue in a populist way. They have also managed this issue in a way that reinforce and protects Nigeria’s apparent ‘UNITARY’ rather than ‘FEDERAL’ System. In other words, NLC and TUC appear to have accepted the deformed State structure of Nigeria as given and a basis for their circular negotiations.
5. Nigeria’s minimum wage has been a major source of impoverishment and enslavement of the workers, especially public sector workers.
1. Minimum wage in Nigeria is ruined always by government policies. In other words, sooner than these wages are fixed, they are attacked by government policies that render them meaningless.
2. The chief tools of government for destroying the minimum wage are devaluation of naira and manipulation of fuel price.
3. If you take the current N18,000 minimum wage as an example, it was arrived at when fuel was N65 per liter and naira was exchanging at less than N100 to a dollar. Today fuel is officially N86.50 and unofficially God knows what.
4. The exchange rate is now between N190 to N400 to a dollar.
5. The implication of 3 and 4 above is that the minimum wage has been abrogated by government policies.
6. Since minimum wage is backed by law, governments in Nigeria are guilty of committing crime.
7. Has labour treated governments as criminals in Nigeria? Criminals when they adjust exchange rate and fuel prices?
8. Labor is therefore guilty of conniving and conspiring with governments to violate the national minimum wage laws in Nigeria.
9. Sooner than these wages are fixed, they are ruined by inflation.
THE REAL PROBLEMS
I have made distinction between the problems and the real problems for obvious reasons; the real problem is not upwards review of the minimum wage in Nigeria. Since we now know that government can agree to N150,000 minimum wage and destroy the purchasing power of that amount by fixing fuel price at N200 per liter and exchanging a dollar for N600. In other words, more funds are put at workers hands with reduced purchasing power.
I want to make it clear that the very structure of the Nigerian State which I have held responsible for most crises in Nigeria is the chief obstacle against a functional, meaningful, and stable minimum wage. Why?:
1. With huge bureaucracy at the federal, state, and local government levels, it is obvious that reasonable minimum wage will continue to remain a mirage.
2. With duplication of functions at the federal, 36states, and 774LGAs, Nigeria would need 20times her current resources to pay minimum wage comparable to the following selected countries:
a. Argentina-405 dollars to be paid for 13months
b. Gabon- 289 dollars
c. Eygpt-174 dollars
d. Saudi Arabia- 720 dollars
e. Angola- 170 dollars
f. Kuwait- 216 dollars
Nigeria has a minimum wage of 67 dollars at N270 to a dollar. 51 dollars at N350 to a dollar.
If we check the purchasing power parity between Nigeria and these countries, the grave poverty situation in Nigeria will strike us like no other thing.
I am uncomfortable to draw our attention to the fact that the minimum wage in:
– Belgium is 1,718 dollars
– Luxembourg is 2,143 dollars
– Switzerland is 2,463 to 4,511 dollars for unskilled workers. While 3,010 to 5,693 dollars for skilled workers.
Clearly the demand by NLC and TUC FOR roughly 186 dollars now is irrelevant because it is a continuation of the old pattern. At best it is stop gap measure not deserving of serious attention.
As expected, the gateway miners in government have started saying that they cannot pay the new amount being demanded by workers. The fact that they cannot pay the the current slave minimum wage of N18,000 is even being citied as reason for rejecting the new amount.
Of course, if you pressure government they will yield to labor and pull their criminal policies to restore the poor wage order.
Edo State introduced a populist N25,000 to alter the perception of the workers. In an election year in Edo state everything is a campaign weapon. At 300 naira to a dollar Edo state Governor is offering 83 dollars. Hahahaha, meaningless.
THE WAY FORWARD
Wages are instrumentalist in essence. They are as useful as what they can purchase. The political structure which is the major reason for dwindling value of Nigeria’s minimum wage must be restructured to conform to highly reduced state structure. I have discussed this issue in my earlier post.
I suggest a civil society driven national conference be organized on the issue of wage in general and minimum wage in particular. This conference should be able to expose the fraud called minimum wage, the collaborators in the dehumanizing treatment of workers in Nigeria. The conference should be able to also chat the way forward.
I recall my idea of speculative economics! How much should we earn to pay internationally respectable wages in Nigeria. What structure and system makes this feasible, possible, and practical?
I will be more than happy to task my intellect for the proposed conference.
May be after restructuring the Nigerian state, the transfer of funds to workers as wages and the subsequent funding of government through politics of taxation might be a more accountable system. In other words, this system that pays peanuts to workers and leaves billions in the hands of the elite political class to spend in pursuit of their false Project approach to development must give way.
The issue of wages and minimum wage is sensitive and has far reaching implication for standard of living in any society. Students, the old, peasants, the police, military personal, judicial officers, artisans, the unemployed, the sick, business, etc. suffer adversely from poor wages. A revolution may be needed to resolve the wage issue in Nigeria.
Andrew Efemini is Professor of Philosophy of Development at the University of Port Harcourt, now with Kogi State University.
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