Governor Godwin Obaseki of Edo State has announced a new minimum wage of N70,000 for civil servants in the state amidst ongoing negotiations between labour unions and the federal government over new minimum wage.
The outcome of the federal government tripartite committee on the new minimum is expected to be announced by President Bola Tinubu on 1 May.
However, Mr Obaseki, while commissioning a new Labour House in Edo State on Monday, announced the new minimum wage of N70, 000, suggesting that the governor made a unilateral decision without waiting for the outcome of the meeting of the National Minimum Wage Committee.
According to Nigeria’s law, the national minimum wage is expected to be reviewed every five years. The current N30,000 was last reviewed in 2019.
Mr Obaseki said the minimum will take effect from 1 May.
Why I increased minimum wage to N70,000
Nigerians workers have suffered severe economic hardship since May last year when President Tinubu declared an end to petrol subsidy, a policy that has tripled the price of petrol, triggered a surge in inflation and forced some workers who could not afford the skyrocketed price of petrol to trek to their workplace.
Mr Obaseki in justifying his state’s new N70, 000 minimum wage said he did so to reflect the current economic realities in the country, Channels TV reported.
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“Let us understand this new minimum wage calculation. In 2011, when the minimum wage was N18,000, the exchange rate was N160/$ and so effectively workers in Edo State were taking home about $120 as minimum wage. When we increased the minimum wage to N40,000 in 2022, the exchange rate at that time was N450/$ so effectively, workers were getting about $96.
“Today, 2024, with the N70,000 minimum wage at the current exchange rate of N1,257/$, what they are taking home is $55 which is less than 50 per cent of what they were earning about a year ago.
“For us in Edo State, we believe that the issue is about productivity; paying people well so that they can produce more and not pretending that you are paying them some salary when you know that that salary cannot motivate them to produce the goods and services that you require,” Mr Obaseki said.
Background
President Tinubu in January inaugurated a 37-man National Wage Committee with a mandate to recommend a new wage for the country.
The committee held public hearings across the six geo-political zones in the country to seek inputs from the public on the new wage structure.
The two main labour unions in the country – the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) had submitted different figures as new minimum wage for the country with the official announcement expected to be made on 1 May by President Tinubu.
But the President of the TUC, Festus Osifo last week said the announcement may not be feasible on 1 May.
Mr Osifo had said that negotiations by the tripartite committee were still ongoing. He said that the TUC and the NLC had harmonised its new minimum wage demand to N615,000.
“So, certainly, May 1, will not work for the pronouncement of the minimum wage. Except if the federal government wants to pay the minimum wage of N500,000 to workers,” Mr Osifo had said.
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