Federal Government Considering Minimum Wage Hike to N200,000 per Month as State Governors Advise Caution

Federal Government Poised to Raise Minimum Wage to N200,000 per Month as State Governors Urge Caution

There are indications that the Nigerian federal government is seriously considering meeting the demands of organized labor by raising the minimum wage to as high as N200,000 per month. The matter was discussed at the recent National Economic Council (NEC) meeting, during which the Salaries, Incomes & Wages Commission made a presentation on the feasibility of meeting the N200,000 minimum wage demand.

President Bola Ahmed Tinubu has expressed personal conviction that the labor’s demand is not unrealistic, citing his campaign promises as evidence of his readiness to address the issue. During his Workers Day address on May 1, President Tinubu pledged that workers would have more than just a minimum wage and assured them of a living wage to support a decent life for themselves and their families.

At the June NEC meeting, the Salaries & Wages Commission presented a cost analysis of the proposed minimum wage increase and demonstrated how the federal government could afford it. However, state governors, represented by Anambra State governor, Prof Charles Soludo, raised questions about the financial implications and asked for a detailed understanding of where the funds would come from and how they would be distributed among the states.

The new foreign exchange policy and expected savings from fuel subsidy are seen as potential sources of surplus cash for the federal and state governments, which could enable a significant raise of the minimum wage from the current N30,000 to N100,000 per month.

To further investigate the matter, a sub-committee was formed at the NEC meeting, comprising governors and key officials. This sub-committee established a Technical Working Group (TWG) led by Governor Soludo. The TWG has already held several meetings to analyze the issues surrounding the minimum wage raise, recognizing that both the federal and state governments share the responsibility for its implementation.

The TWG has resolved that negotiations with labor should be conducted separately between the federal government and the state governments. The sub-committee’s report and recommendations will be presented to the NEC later this month, and subsequently forwarded to the President for consideration as an advisory.

While federal government workers are likely to receive the substantial minimum wage increase, the fate of state workers will be determined by the recommendations of the Soludo-led TWG.