By Chioma Obionna & Tunde Oso
Mr Joe Ajaero, General Secretary of National Union of Electricity Employees (NUEE), says Nigeria cannot afford to fritter away $9.6billion judgement debt. He also speaks on the delay in the implementation of minimum wage
His words: “Yes the delay in the implementation of the minimum wage is all about consequential adjustments and the Federal Government should take the blame. The matter has been lingering for two years. Government, actually ought to have incorporated it into the 2019 Budget. Common ground is needed to be reached quickly even as negotiations continue. I heard one government official say the wage has yet to be implemented as a result of unresolved little details. “This shows the lack of seriousness of government. The consequential adjustments are not little details. What government proposes is N10, 000 adjustment across the board, which are being rejected. This is because the increase in the minimum wage from N18, 000 to N30, 000 was 66 per cent. Hence workers want 66 per cent increment across the board.
“In labour relations, there’s what is called power relations. No minimum wage is achieved without a struggle. We all know why the government is delaying, dilly-dallying. It should, however, realize that it is not gaining any advantage by this delay because it not to would have to pay the backlog in salary arrears. This minimum wage is actually two years behind time and it is unfortunate that we’re wasting more time with this delay.
“The $9.6billion judgment against Nigeria is another evidence of our government‘s usual tardiness in responding to issues of urgent concern. It must, therefore, find its way out of the quandary it has put itself either by diplomacy or legally. This kind of money can transform the lives of close to 200 million Nigerians. The huge figure represents one-fifth of the country’s declared foreign reserves of $45bn.It is very unfortunate because the project would have generated 2,000 MW of power for the national grid.
“States have always given the excuse of insufficient revenue for their inability to pay the minimum wage, hinging it on the fact that the Federal Government received a larger share from the federation account while states were left with insufficient revenue to pay salary if the state is to provide other basic social needs.
“This, however, does not hold water because you discover that states that are earning huge allocation, either because of derivation or for other economic factors are the most notorious defaulters on minimum wage. I don’t want to go into their names, but workers suffer most in supposed rich states in Nigeria today than other states. So, payment of minimum wage depends on the political will of respective state executives”.
We are very vulnerable at the moment – Muda Yusuf
Mr Muda Yusuf, Director-General of the Lagos Chamber of Commerce and Industry (LCCI), speaks on minimum wage and the $9.6billion judgement debt against Nigeria.
Yusuf said: “The issues of consequential adjustments and payment of arrears are thorny issues that the federal and state governments would have to grapple with at this time. The reality is that the financial standing of the federal and state governments is fragile.
“Meanwhile, the minimum wage policy would expectedly impact positively on the welfare of workers [when implemented], especially the low-income ones. The current minimum wage debases the humanity of workers. N18, 000 is just about $50 for a month. This is abysmally low. We are talking of workers who perhaps have families, need to pay house rent, pay school fees, pay for transportation and pay for housing, pay for health services. It is practically impossible to access the basic needs of life at such a wage level.
“There is, therefore, a good reason to applaud the outcome of the wage negotiations. Of course, the N30, 000 minimum wage [which is just about $83 a month] is barely adequate to meet even basic needs of the worker, especially in the light of the collapse of social services.
“However, the trouble with the public service across all levels of government is the unsustainable workforce that they are carrying. They’re also too many political appointees at all levels of government. There are also instances of ghost workers in many of the states and local governments.
“These are the fundamental issues in the capacity of the states and local governments to pay a decent wage. Current workforce in many of these jurisdictions is not sustainable. There are also instances of fiscal leakages, issues of value for money in public expenditure and the quality of expenditure priorities.
“If the right things are done, the capacity to pay should not an issue. A review of the current revenue allocation formula would be necessary to enhance the capacity of the states and local governments to cope with the new minimum wage
“Most private sector institutions are already paying well over the N30, 000 minimum wage. The minimum wage conversation is more of an issue for the public sector than the private sector. Although many micro and small businesses there may be compliance challenges owing to the numerous impediments and burden of the business operating environment. Many of them are in fact struggling to remain afloat. Some employers in this category sometimes even borrow to pay salaries of workers. So, for this class of businesses, capacity may be an issue.
“In all of these, increased quality spending on social services by the government would bring considerable relief to workers and less pressure on their income. There should be quality spending by the government in education, health care, transportation, agriculture to provide food, social housing and many more. The macroeconomic management should also be such that will keep inflation low and preserve the value of the income of workers and the citizens.
“It is doubtful whether the states have the capacity to pay the consequential adjustments being currently proposed by labour. It is important to speed up negotiations to avert another round of workers strike, which normally comes with attendant dislocations in the economy.
“This will depend on the outcome of negotiations between labour and the various tiers of government. While it may be easier for the federal government to contemplate payment of arrears, the same cannot be said of the states. Implementation issues may possibly trigger another form of industrial action.
“The most difficult part will be the consequential adjustment which may have a significant impact on the finances of the government.
Implications of $9.6 Billion Judgement Debt
“From the recent briefing by some of the cabinet ministers, there is optimism that the ultimate ruling at the appeal would be in favour of Nigeria. It is also not clear whether the judgment referenced financial assets or any other asset.
“But in the unlikely event that we did not win the appeal and the settlement has to be in cash; the consequences would be devastating. Currently, the foreign reserve is under pressure and oil price outlook is not quite positive. The macroeconomic fundamentals would be thrown completely out of balance. This is not the time to be exposed to any major shock. We are very vulnerable at the moment”.
With such amount, we can reverse medical tourism -Oseni, Lagos NMA Chairman
Lagos State Chairman of the Nigerian Medical Association, NMA, Dr Saliu Oseni, on his part, said: “N8.92 trillion is the Nigerian budget for 2019. $9.6 billion is just a bit below the Nigerian budget for 2019 and indeed losing such an amount is going to be a disaster to the country’s economy and, by extension, the health sector would suffer from it.
“Of course, investing such an amount on health, if properly managed and monitored, would definitely turn the sector around and, with appropriate infrastructures available, we would compete with the health sector in developed countries. Indeed putting this amount into primary health care would go far and wide.
“However, it is important that we must not lose such a huge amount of money to bad governance, thus it’s important for the government to challenge this judgement appropriately to reverse it.
“All we can say is to pray for our country for a progressively caring government. With such amount, we can actually reverse the medical tourism by developing some quaternary service units where highly specialised medical services could be rendered. This could be made available in the six geographic zones, also cancer centres could be built to create improved and subsided treatment for cancer patients.”
Think of ill-equipped health facilities $9.6b can help – Paul-Ozieh, pharmacist
Also speaking, a former Chairman of the Association of Community Pharmacists of Nigeria, ACPN, Lagos State branch, Abiola Paul-Ozieh, said: “Of course, losing $9.6 billion would be a big blow to Nigeria as a nation. Think of the fact that it is about 20 per cent of our foreign reserves.
“Think of the ill-equipped health facilities that endangered the lives of millions of Nigeria. Think of the huge sums of money deployed in medical tourism because our health facilities are not adequately equipped with manpower and machines.
“Think of the National Health Insurance Scheme, NHIS, that is wobbling and fumbling. Think of the sorry circumstances of our public health institutions that make Nigerian health care professionals leave Nigeria for other countries seeking greener pastures.
“What about the promised 10,000 primary health centres this current government has not been able to deliver? In fact, $9.6 billion would have gone a long way to equip the PHCs which are the first contact of the public with health service delivery.
“Think of our numerous tertiary health care institutions, the teaching hospitals which were once tagged – Centres of Excellence. Now they have become mere consulting centres with a little drive for research and the atmosphere not conducive for training, development and research.
“Imagine what turnaround with $9.6b. What about the various health-related research centres?
Imagine if regulatory bodies like the Pharmaceutical Council of Nigeria, PCN, Medical and Dental Council of Nigeria, MDCN, NC, LMNSC are supported with adequate funding and resources. What mileage these ones will go to order our health care delivery system.
“The news is unpleasant and portends a bleak future as it were for our already shaky financial status. One is just hoping that it is a dream that will not come true”.